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Sun 9 Feb 2014 11:39 AM

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Abu Dhabi to launch property rent index: report

Rental guides will be released for residential property according to 10-12 zones

Abu Dhabi to launch property rent index: report

Abu Dhabi will launch a property rent index recommending prices next month, according to Arabic daily Al Ittihad.

The capital would be divided into 10-12 zones, with a guide for rents in each zone according to market data, the newspaper said. It is not clear whether the zones will cover the entire city or only the main island.

The rental guide could be used to settle disputes between tenants and landlords, particularly after the government removed a 5 percent cap on rent increases in November.

According to Jones Lang LaSalle, property prices in Abu Dhabi rose by up to 25 percent last year.

Its Abu Dhabi Market Overview Q4 2013 report said prices rose six percent in the final quarter of 2013 but the significant gains were limited to prime projects.

Prime residential rents increased on average by 17 percent during the past year and by eight percent in the last quarter, the report said, adding that it was driven in part by new job growth, reduced commuting from Dubai and the removal of the 5 percent annual rent cap.

There are now about 218,000 properties in the capital, JLL said.

A source told Al Ittihad 10 percent of residential apartments were unoccupied, helping to keep down rents.

The index is being compiled by the Department of Municipal Affairs, the Department of Economic Development, the Urban Planning Council and the Abu Dhabi Council for Economic Development.

Dubai already has a similar rent index and is revamping it to include additional information when calculating allowable rental increases.

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