(MENAFN- Khaleej Times) One of the UAE's largest property portals - propertyfinder.ae - said the rental gap between Abu Dhabi and Dubai had narrowed, signalling a positive development for the capital city's property market.
"With rents in Dubai on the rise and those in Abu Dhabi showing a slight decline since the start of the year, living in Abu Dhabi is becoming just as affordable as that in its neighbouring emirate," the portal said.
"This industry dynamic, alongside the recent relocation decree and quality housing units entering the market, is making it possible for Abu Dhabi residents to enjoy similar standards of living to those they enjoyed in Dubai," It said.
Market Price Live, propertyfinder.ae's up-to-the-minute data centre, integrates real-time pricing information and user behaviour to provide average advertised property prices for sale and rent. Using this tool, users can discover the typical price for properties in each emirate with just a few clicks.
"The average price for renting an apartment in Abu Dhabi today is Dh143,000 while the same in Dubai is around Dh142,500. A villa, on the other hand, will cost you on average Dh246,600 to rent in Abu Dhabi and Dh256,000 in Dubai - negligible differences - and evidence of the change in rental pricing in the two cities," said Renan Bourdeau, managing director of propertyfinder.ae.
However, realty sale prices across the two emirates continue to show a disparity. On Market Price Live, the average price of an apartment and villa in Dubai stands at Dh2.6 million and Dh6.5 million respectively, while in Abu Dhabi the standard price for an apartment is Dh1.8 million and Dh3.1 million for a villa.
"While the closing rental gap may be a positive sign for Abu Dhabi's property market, it remains to be seen what the effects of the increasing stock yet to hit the capital will be. It will be interesting to observe if the current growth in housing demand in Abu Dhabi driven by government spending and the relocation ruling will persist despite continued additions to supply over the next few years," said Bourdeau.
According to a CBRE Marketview report, Abu Dhabi residential rental rates had dropped four per cent in the second quarter of this year despite a rise in tenant activity.
The government's decision stipulating Abu Dhabi employees to relocate back to the emirate has not helped hike rents, the report said.
Residential rents in the capital are now down by 10 per cent in the last 12 months despite increased leasing activity and record sales transactions in the first half of this year.
In Dubai, average housing rents increased by more than 30 per cent over the past year and nearly 14 per cent over the first six months of the year.
The increase last quarter was driven by a rapid increase in rents in secondary locations like Dubai Sports City and Jumeirah Village as tenants priced out of Dubai's most expensive locations look to relocate in more affordable accommodation, CBRE said.
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