Friday, April 17, 2009

Rents in Abu Dhabi higher than in Dubai

Rental in Abu Dhabi continues to remain strong are likely to remain so, despite the decline in rents in the other GCC nations owing to the global financial crisis.

The leading property management company, Asteco, has reported that residential and commercial rents have dropped very little during the first quarter of this year, inline with capital values. The scarcity in supply of residential and commercial units has led to high demand for quality office and apartments.

Companies are also reducing the accommodation allowance of staff, which has made its impact felt on the ability of tenants to rent at current levels.

Residential apartments in the Corniche and Khalidiya are the most popular, and rentals are high in these areas. The average annual rent for a single bedroom apartment in these areas are Dh.252,500 and Dh.170,000 respectively.

Just as in Dubai, even here, the local investors do not agree to lower their prices on vacant units. However, expatriate owners have reduced their apartment rents by almost 20 percent.

Villas in Bateen and Khalidiya are expensive with Dh.365,000 being charged per year for a three bedroom apartment, while Dh.410,000 and Dh.475,000 are being charged for four bedroom and five bedrooms.

On the whole, the rents in Abu Dhabi seem to be more expensive than in Dubai, in contrast to the usual norm.

The Managing Director of Asteco, Andrew Chambers, has warned that due to shortage of supply, Abu Dhabi is just being perceived differently. About 5000 to 6000 new apartments would come on the market during early 2010.

This extra stock would give tenants a better range of properties to choose from, and offer better flexibility in negotiating with landlords. There is an increase in residential apartments in the Passport Road, Hamdan Street, Corniche and Muroor areas. More villas would enter the market this year, particularly in the Golf Gardens, Al Reef and Khalifa City A and Al Raha Gardens.

As for the commercial rents, there is still strong demand noticed for Grade A office units, while substandard properties have seen a decrease in rents. Office spaces have dropped 27 percent on Defence Street and Muroor, and by 25 percent on Passport Road.

1 comment:

denver real estate said...

Thanks for the blog. It says that rents in Abu Dhabi is higher than Dubai. The comparision is based on price.