Tuesday, June 17, 2008

Abu Dhabi realty prices to appreciate more than in Dubai

A strong growth, backed by huge demand, a growing population and liberalization of the real estate sector, is likely to keep prices strong in the Abu Dhabi real estate sector for the next seven years, reports EFG-Hermes, a regional investment bank.

The report states that the longevity and strength of the real estate phase in Abu Dhabi, is supported by shortages of all types of real estate, controlled by delivery of supply to avoid a surplus, coupled with greater economic liberalization, and creation of a unique identity.

According to the Author of the report, Sana Kapadia, "A strong government presence supports and caps on the amount of real estate that can be built on any given year to mitigate the risk of an oversupply of property."

No major additions of residential units are likely in Abu Dhabi until late 2009, and with the ever-growing demand, the residential market will remain under-supplied until the end of 2009.
It has been estimated that the average price of residential properties will increase by 20 to 25 percent, during the rest of this year, and by 15 to 20 percent in 2009.

Demand for office space, too, will remain strong, with current vacancy rates at 1 percent, and with newer businesses seeking to make their presence in Middle East, it has been predicted.
However, considerable supplies that are likely to come in during 2009, will help cool the rising rents and prices, it is said.

Meanwhile, in a survey conducted by DSL Exhibitions, an international firm, specializing in organizing conferences and exhibitions, real estate investors expect that prices of properties in Abu Dhabi are likely to appreciate more than that in Dubai and other northern emirates.
The survey was done to find out if there exist any differences in the perceptions and attitudes of real estate buyers, between choosing Dubai, Abu Dhabi or one of the Northern Emirates and to underline any apparent trends.

The survey has revealed considerable differences in the attitudes and perception of investors, who choose between the three regions - Abu Dhabi, Dubai and Northern Emirates.

1 comment:

sunil said...

this is no secret. dubai has already gone through its rapid spurt of increase. now abu dhabi is catching up with development and a growing job market. this will naturally call for more demand and more appreciation in properties. it is nowhere near dubai's level right now and it will take some large chunks of annual hikes to get it there. we all saw this coming, expect it to be this way for 24-36 months until things eventually levelize between the two.