Abu Dhabi is following its glamourous rival, Dubai, as the emirate engineers a recovery that could pave way for a new phase in the performance of its real estate market. Following the ‘live local’ policy and the removal of the rental cap last year, rents have ticked up in the capital, according to propertyfinder.ae, the UAE’s leading property portal.
“Up until the beginning of 2013, rents in Abu Dhabi were traditionally considered to be higher than those in Dubai. However, just as the housing decree was passed late last year, we revealed a decline in Abu Dhabi’s rental prices even as rents in Dubai continued to rise, narrowing the price gap between the two emirates. However, with the removal of the rental cap and the number of new tenants in Abu Dhabi increasing due to the relocation of government workers to the city, rents in the emirate are seeing an upswing,” commented Michael Lahyani, CEO and Founder of propertyfinder.ae.
Reporting an overall hike of over 20 percent in leasing prices in December 2013, propertyfinder.ae has also revealed individual rent rises in Abu Dhabi’s popular neighbourhoods.
“When we ran the numbers on Market Price Live this month, our up-to-the-minute data centre, Hydra Village for instance, already showed an increase of three percent from December 2013 figures. Rents in Mohamed Bin Zayed City, on the other hand, have risen by over two percent,” said Lahyani.
The latest move by the government to regulate rental prices in the capital was announced earlier this month. A rent index, expected to be introduced soon, will use market data to set fair rents for each of Abu Dhabi’s 10-12 residential zones.
“Numerous residents have been forced to downsize due to the surge in rents. So the hope is that the index will protect tenants and landlords by maintaining prices at competitive levels as rents are expected to rise further this year,” added Lahyani.