Dubai has an unparalleled real estate market being a host to the world’s most daring engineering marvels and luxurious properties. But, for those looking for an investment property within the city, it can be a challenge. For this, Sharjah has risen to the occasion.
Bumped up against Dubai’s eastern border, Sharjah is the third largest city in the UAE. It contributes about 7.4 per cent of the GDP and covers an area of 255km.
The emirate has become the golden nugget of the UAE’s future real estate development plans and is just waiting to be transformed into the next Dubai.
In the past decade, Sharjah officials and private development firms have worked together to make investing in Sharjah a more inclusive environment, launching groundbreaking legislation in 2014 allowing expatriates to buy property in Sharjah with the rider of a residence Visa.
Since then, the change has provided an investment outlet for those living and working in Dubai, especially those who were facing the threat of being priced out of their homes. It also offered developers a fresh place to begin the process of city planning in this cultural center.
From its inception, the plan to make Sharjah a new city hotspot was meticulously planned by officials and private developers. The initial 2014 plan to allow expat investment also stated they could only purchase property on the edge of the city center, effectively building cluster communities around the hustle and bustle of the city. The plans were designed to reduce traffic and build the city up from the outside in.
A new law in 2018 now allows expats to purchase property without a residence Visa in Sharjah on leaseholds of 100-years. With this announcement, developers now have an avenue to develop on over 25 million square feet of established land in places like Tilal City.
One of Sharjah’s shining development plans is Aljada, a mixed-use mega project by Arada. Sharjah is currently known as the cultural capital of the UAE and offers an inclusive environment for visitors, with an abundance of museums and galleries.
Last year, Sharjah made headlines with their new development plans that included technology parks and airport expansions. It has seen transportation upgrades and in 2019 it will become Unesco’s World Book Capital.
But is the market stable?
Sharjah Market Stability
The answer is yes, Sharjah’s market is stable. And it is largely due to how the plans to expand, real estate wise, in Sharjah were established. In this market, developers do not have to spend up to two years developing the infrastructure of the land they are proposing to build on. Neither are they expected to have to pay for this, which can cost up to 40 per cent of the budget.
Building on Established Land
Tilal City is already a developed location. It is equipped with sewage and utility lines and has the Sharjah International Airport within 10km. This alone serves as a welcome sign for developers looking to save on profitable investments.
This location also has an established population of almost 1 million, with more residents coming to escape the rising prices in Dubai. For now, the prices in Sharjah are an affordable option for them, they are just looking for somewhere to invest their monies. Furthermore, the elimination of Visa restrictions opens the market up to a whole new world of competing developers and investors.
Property Pricing in Sharjah is Lower
The emirate has been continuously strengthening its reputation for affordable housing, and it is reflected in the price decline of its properties. In reports on Bayut.com, the average 1-bedroom apartment dropped in price by 16 per cent, while a two-bedroom dropped by 14 per cent. Apartment sales dropped by up to 10 per cent all around.
Prices are low now and ripe for investment. However, with the recent change in the law, and more buyers flooding the market, prices are expected to rise in the coming years. This means now is the time to buy and develop in Sharjah before the masses flood the market. Right now, Sharjah is experiencing an oversupply of properties, which has, in turn, lowered the cost of living, providing for a new competitive market.
The Cost of Living in Sharjah
The cost of living in Sharjah is lower than neighboring Dubai. The average single person’s expenses are around $745 (2,736 AED) excluding rent. The average trip to the grocery store is roughly $30.10 (110.56 AED). And a one-bedroom apartment outside of the city center is about $583 (2,144 AED).
These figures are affordable and lay a new generation of buyers at the emirate’s doorstep. Overall, Sharjah has a strong footing and is expected to be a profitable market in the future.