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Expats in Oman get bargain rentals due to oversupply and falling demand
| Published: | 17 Apr at 6 PM |
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The rental market in Oman, reeling due to Omanization, the shrinking economy and expat departures, is now the scene of manipulation by wily expats looking to save on rental charges.
The plot is simple and involves swapping their accommodation for a similar but cheaper home in the same enclave or street. According to a major real estate consultancy, expatriate tenants looking for residential or commercial properties now have the upper hand as regards negotiating the terms and costs of leases, and local estate agents are in complete agreement with this evaluation.
In Muscat, rents have already dropped by up to 40 per cent in certain areas, with even sought-after locations such as Qurum seeing falls of around 5 per cent. Leading agencies are saying oversupply is a major reason for the drop in rents, especially when combined with a lack of facilities such as off-street parking and adequate security. Residents, they add, are now seeking better options as regards amenities, with landlords unable to provide these extras finding it hard to get tenants in the present economic climate.
Major victims of the change include owners of rental properties in multi-storey apartment blocks with few facilities, and achievable rents are set to continue their fall for the foreseeable future. One expat who’s made the move told the Times of Oman he’s won twice, once by saving money on his rental charges and secondly, because his new apartment is closer to his childrens’ school, he's s also saving money on transport.
Others are moving because their landlords refuse to reduce their rents in spite of the continuing downward trend. Formerly popular villas on the edge of the city are now struggling to find tenants, with rental revenues falling by 50 per cent and very few takers. Real estate professionals believe rental charges have been underpinned by the high number of expat professionals working in the emirate. As the numbers decline, the supply of vacant homes increases, even in prime locations, leading to falls in achievable rents of between five and 20 to 40 per cent, dependent on the area.
Even brand new villas in secure compounds with communal pools and gyms are seeing realisable rents dropping by around 10 per cent, and shorter rental contracts are becoming the norm. Overall, it’s good news for expat renters and bad news for landlords.
The plot is simple and involves swapping their accommodation for a similar but cheaper home in the same enclave or street. According to a major real estate consultancy, expatriate tenants looking for residential or commercial properties now have the upper hand as regards negotiating the terms and costs of leases, and local estate agents are in complete agreement with this evaluation.
In Muscat, rents have already dropped by up to 40 per cent in certain areas, with even sought-after locations such as Qurum seeing falls of around 5 per cent. Leading agencies are saying oversupply is a major reason for the drop in rents, especially when combined with a lack of facilities such as off-street parking and adequate security. Residents, they add, are now seeking better options as regards amenities, with landlords unable to provide these extras finding it hard to get tenants in the present economic climate.
Major victims of the change include owners of rental properties in multi-storey apartment blocks with few facilities, and achievable rents are set to continue their fall for the foreseeable future. One expat who’s made the move told the Times of Oman he’s won twice, once by saving money on his rental charges and secondly, because his new apartment is closer to his childrens’ school, he's s also saving money on transport.
Others are moving because their landlords refuse to reduce their rents in spite of the continuing downward trend. Formerly popular villas on the edge of the city are now struggling to find tenants, with rental revenues falling by 50 per cent and very few takers. Real estate professionals believe rental charges have been underpinned by the high number of expat professionals working in the emirate. As the numbers decline, the supply of vacant homes increases, even in prime locations, leading to falls in achievable rents of between five and 20 to 40 per cent, dependent on the area.
Even brand new villas in secure compounds with communal pools and gyms are seeing realisable rents dropping by around 10 per cent, and shorter rental contracts are becoming the norm. Overall, it’s good news for expat renters and bad news for landlords.
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