Monday, March 07, 2011

New housing supplies in Abu Dhabi unlikely to affect Dubai

According to industry experts, Dubai will only be marginally affected by the new housing units entering Abu Dhabi market. This is because, although about 21,000 new housing units are due for delivery this year in Abu Dhabi, a delay in handover of units are likely, and only half of the said housing units may be delivered eventually.

However, Dubai’s Marina may be impacted, partly due to the new units entering Abu Dhabi, and also as there are about 12000 units yet to be delivered in Marina.

According to Landmarks Properties CEO, Charles Neil, people living there may prefer to move to Abu Dhabi and/or other projects such as JLT where there is less congestion. Therefore, rents are likely to fall in Marina by next year or in 2013.

Even the Residential Leasing Consultant at Barsha Office of Better Homes, mentioned that although the Abu Dhabi realty market may get a breather, it may not bear an impact on Dubai property prices, nor would it prompt people working in Abu Dhabi and living in Dubai to consider re-location. But properties in Marina and Emirates Living Communities may compete for rental rates.

One of the main reasons is the lack of good residential units in Abu Dhabi, coupled with high demand that the city faces. The buildings in Abu Dhabi, particularly on island, is poor with little amenities, and parking being a major problem, points out the expert at Landmark Properties.

Meanwhile, the attractive rents and the good lifestyle that Dubai offers will continue to lure tenants and they may not think about re-location, say experts.

Moreover, experts predict that prices of housing units in the Capital are likely to be higher than those in Dubai for the time being. Although more stock would be available in Abu Dhabi, it cannot compete with prices being offered in Dubai atleast for some time soon. Moreover, the ‘lifestyle’ factor also counts.

However, for the 20percent who chose to move back to the Capital, rental rates will still not be able to compete with those in mature communities of Discovery Gardens and JLT, wherein a single bedroom apartment is available for Dh.35,000 to Dh.50,000 per annum, the Better Homes expert said.

Even when all planned units are finally delivered, a major reversal of people moving to Abu Dhabi is unlikely, as with rapid growth of Abu Dhabi economy, there will not be an oversupply of quality accommodation, and equilibrium is expected only by about 2014. Moreover, there are other factors also to be taken into account such as better quality of schools in Dubai, and families with single-earning members being able to survive better in Dubai, pointed out Neil.

1 comment:

Babymoselle said...

Up to last year, the preference was clear that people did not want to stay in JLT because of the construction and the lack of tiled roads to walk or jog, I mean it was a mess. JLT last year was something and this year is totally something else. We used to live in Marina and have moved last year to JLT and every day we see improvements to the community that it is becoming a joy to live here. The lakes are already filled, the lake-walk all around is beautifully paved and lit, the landscaping around the lake where you can take your walks and socialize with other commnity members is beautful, full of trees and flowers and grass. There are already a few playground areas with swings and slides for kids. While you walk you can stop and sip a cup of coffee on the lake in one of the many cafes that opened or even eat in one of the many restaurants that offer really good food (I tried Peppery Cafe and Itzza Pizza and Sale Sucre, all are superb). If you feel like doing your hair or nails, there is nothing more than coffee shops here except beauty saloon! So just go down and be ready without driving any where! No wonder why many people who work in Abu Dhabi choose to live here in JLT!