By Soren Billing
UPDATE 1: Landmark Advisory says rental values stabilised in UAE capital in third quarter.
Residential rents in Abu Dhabi declined marginally in Q3 and the first part of Q4, Landmark Advisory said on Sunday.
“Low quality units continue to be the worst performing assets. Declines, however, are largely marginal, which indicates rental stabilization,” said Jesse Downs, director of research.
In the apartment segment, low quality units declined up to 5 percent but good quality units were largely unchanged in the period.
Average rent levels for units on Abu Dhabi Island remained high, with one and two-bedroom apartments fetching AED 130,000 ($35,417) and AED 190,000 per annum, respectively.
“A continued influx of young professionals seeking centrally located apartments keeps this sector buoyant,” said Andrea Menown, leasing manager at LLJ Property.
Demand for villas in the capital has increased as traffic congestion and scarce parking around older, centrally located apartments prompts more people to move to off-island compounds offering community facilities and proximity to newly developed amenities, she added.
Low quality villa units slightly decreased up to 8 percent in the period while good quality units, especially on the main island, held their value.
Office rents stabilised in early to mid-September following declines of up to 20 percent during July and August.
“In terms of commercial property, demand is currently focused on smaller units, as the majority of companies entering Abu Dhabi are readjusting their previous approach, which was bullish during Q1 and Q2 2009,” said Downs.
“Demand for larger spaces is restricted to a small number of pre-existing companies that are still planning to expand or relocate,” she added.
AD is going gang busters despite of the recession, just watch rents turn around in Q1 and start going back up. Boom time!
I dont think so, my landlord Shabeeb Hilal Dhaheri has just sent me a 5% increase notice, al;most 3 months beofre it comes for renewal. Further, even though my area is under Mawaquif, DoT has not bothered to implement it on this stretch of Khalifa street, since our building has Europcar Rent a Car with more than 300 cars parked below.
The arcticle should not give a positive impression about prices. In contrast, it should give red alarm to be paid attention. If you start for searching a flat seriously by visiting the building and contacting the real estate agencies, you will easily obtain the real figures in the market in max 2 days. A reasonable and acceptable 2 bedroom flat (not new one), 5-7 years older one lets say, is not lower than 180.000AED per annum. People are still in trouble and this situation should be changed, prices should be much more lower until they will reach to an affordable level.
As more affordable housing comes into the market next year, rents will slide , as the market does have it's peak and low's and the same will take effect , no matter what the land lords demand , there will have to be a compromise.