Rent prices in prime Abu Dhabi areas up 17% in 2013
Rents in Abu Dhabi’s prime residential areas increased by nearly 17 per cent during 2013 and there are projections for further hikes this year, industry analysts have said.
This puts the rent for a prime two-bedroom apartment at an average of Dh140,000 in areas such as the Corniche, Al Bateen, Reem Island, Yas Island, and Al Raha Beach, according to Jones Lang Laselle, a global real estate services firm.
Meanwhile, a two-bedroom apartment in central Abu Dhabi now costs an average of Dh70,000 per annum, according to the latest report by Asteco, a real estate services company.
The report, which analyses the fourth quarter (Q4) of 2013, noted that the figure marks a seven per cent increase compared to Q3 2013.
The increases were due to the recent removal of the federal rent cap, which gave landlords the opportunity to raise rates, leaving many tenants looking for cheaper apartments elsewhere.
“The average rent increase is around 10 per cent, but some landlords have raised prices by 30 per cent straight away. In Al Reem [Island] rent prices are out of control but people are still renting because it’s the best place in Abu Dhabi,” Mo’en Hamdani, branch manager at Elysian Real Estate, told Gulf News.
He added that there is also great demand for accommodation in Saadiyat Island, which has led to an increase in prices.
In fact, prices continue to increase even in areas outside Abu Dhabi city. According to Asteco’s report, areas such as Al Reef, Hydra Village, and Khalifa City are experiencing some of the fastest rental growth as tenants are priced out of other developments.
Drica Rodrigues, head of residential leasing and sales at Cluttons LLC, a property consultant firm, said Al Reef has seen the biggest price hike especially with the opening of new facilities in the area.
“In areas like Mussafah and Mohammad Bin Zayed, previously, you could get a one-bedroom apartment for 40,000-45,000 but now, it has increased at least by 10 per cent. There is a lot of demand for [accomodation] in those areas,” Rodrigues said.
As for the outlook for 2014, analysts expect prices to increase.
Craig Plumb, director of research at Jones Lang Laselle, said he predicted rents to increase by over 10 per cent during 2014.
Meanwhile, Abdul Bari, sales representatives at Al Bab Property Management, said that Dubai’s Expo 2020 will lead to an increase in the demand for residence in Abu Dhabi. This may result in an increase in rent prices by 20 to 25 per cent.
- Al Bustan Centre & Residence wraps up a successful participation in ATM 2015
- The reality of realty: inbound property investments in GCC 'far less' than outbound
- Dubai's hospitality sector is a sound investment
- Quiet and wise: How Oman is transforming itself into a major logistics hub
- Revealed: the top real estate tycoons in the ME