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Dubai: Escalating property rentals are affecting businesses in Dubai, traders said in a survey conducted by Dubai Chamber of Commerce and Industry (DCCI).
The Outlook Survey of Dubai Traders 2007, conducted during the first two months of the year, showed property rents to be the biggest "limiting factor" that affected traders' operations in 2006, and was expected to remain so this year.
Among the businessmen covered, 87 per cent said they were hit by high rents last year. About 85 per cent of them expected rents to continue affecting their businesses this year.
The responses of a representative sample of 452 traders distributed across all sectors, employment sizes and market type also cited high operating costs, keen competition, bad traffic situation, high transport costs and difficulty in debt collection as major limiting factors.
"Businesses are currently reeling from escalating rentals and transport costs, which cut into their dwindling profits. In addition, housing for their expatriate workers has become a burden, especially for small traders saddled with high turnover and difficulty in hiring skilled workers," the report said.
Tessa Morris, marketing director of DSL Exhibitions, who have been organising the Resale and Rental Property Show in Dubai for several years, said increasing rents could indeed hurt businesses as rental prices were the largest component of the UAE inflation.
Your comments
The present trend of increasing rent will affect businesses in Dubai . The goverment cannot control the rent due the high demand. The only way to control rent is to increase the minimum salary for sponsoring the family. The government has to increase it from Dh4000 to Dh8000 per month, considering the present cost of living in Dubai.
Shaju
Dubai,UAE
Posted: December 10, 2007, 09:40
Yes,everyone is aware of the rising rent, as a result of which many small businesses are either going to close down or have already closed down. This is having a big and bad impact on the UAE. The only solution is that the government should "order" landlords to decrease the rent. As it is, the visa cost, labour card charges, health fees, salaries, housing and various allownaces are seriously hitting the business people. I hope the authorities would help the business people who are still in Dubai.
Satta
Dubai,UAE
Posted: December 10, 2007, 09:01
We have all come to Dubai earn money, but the present situation is such that we have to borrow in order to pay all the expenses.
Rajan
Dubai,UAE
Posted: December 10, 2007, 08:40
The present rate of inflation is too high, especially the rents, as the housing allowance provided is not sufficient, the basics salary is not increasing and the commodity prices have been rising steadily over the past three years. This is making life difficult for expatriates
Louis
Dubai,UAE
Posted: December 10, 2007, 07:38
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