By Will Rasmussen
Prices to jump as demand outweighs supply and low interest rates fuel investment, says Sorouh exec.
The price of homes in the UAE capital, Abu Dhabi, could rise by at least 20% this year as demand outweighs supply, and negative real interest rates fuel investment, Sorouh Real Estate said.
Europeans are investing in the UAE looking to use their stronger euro as the dollar declines, taking the UAE dirham with it, Gurjit Singh, Sorouh's chief property development officer, said on Monday at an investment conference in Abu Dhabi.
A five-fold rise in oil prices in the past six years has boosted Abu Dhabi's economy and low interest rates have fuelled investment in real estate.
"We should easily see a growth of 20% this year," Singh said on the sidelines of the conference. "What we are seeing now is a growth phase. We are still very early on the clock."
Average residential real estate prices range between 1,300 dirhams ($354) and 1,700 dirhams per square foot, he said.
Europeans buying residential property in Abu Dhabi account for between 8% and 12% on the emirate's real estate market.
"It is rising because of the strength of the euro and the pound," Singh said.
Sorouh is developing real estate projects in Abu Dhabi worth 40 billion dirhams, Singh said. (Reuters)