By Andy Sambidge
New rules also see contract extended from 4 to 5 years in bid to stabilise market.
Officials have ruled that the maximum annual rent increase on properties in Abu Dhabi will remain at five percent.
The rent rise limit was announced as part of a new law issued by Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and reported by news agency WAM.
The regulations also state that tenancy contracts can now be issued for a maximum of five years instead of the previous four.
Officials said the move was an attempt to "stabilise the property market" as many new residential and commercial units were expected to open in the emirate during 2010.
The Executive Office also said a panel would be set up to study the "economic and social dimensions of the legal regulation of the tenancy contracts".
It will analyse the economic impact of any amendments on tenancy contracts and the property market in the UAE capital, WAM added.
Rents in Abu Dhabi have remained stable or have even increased slightly because of a lack of supply, while prices in Dubai have plummeted.
In both Dubai and Abu Dhabi, landlords cannot increase prices by more than five per cent a year for the period of the tenant’s agreement. In Dubai, they are barred from increasing rents at all for the first two years, reported UAE daily The National.
Abu Dhabi rent prices should come to a level like in Dubai which isnow more affordable. Neither this 5% rise, nor contract period will be 5 years, these are not enough to help to the majority of the Residents. We need to have new legislative program from government for fixing the prices of the new residental areas and the prices will be normal level. Accordingly, prices will be decreased in old and existing residential areas.
All the residents in Abu-Dhabi are suffering because of the brokers which are renting double from the original price. If the law is saying 5% increase, they will do 10%. At the moment people are struggling to have a room in Abu-Dhabi which is increase in one year by 37%. The prices for a studio in Abu-Dhabi are starting from AED 55,000 plus you have to pay a commission for AED 5000 or more. They should have a look for the market and check the ways are renting the real estate companies in Abu-Dhabi. On this way they will help all the residents and will have better numbers and profit on the renting side.