(MENAFN - Khaleej Times) With the removal of annual rent cap of five per cent in abu dhabi residential rentals have surged ten per cent on average in the first three months of the year
“housing units in off-island locations experienced higher rent growth at 14 per cent during the period” according to the latest abu dhabi marketview by cbre the leading international real estate consultancy.
However in some individual cases the residents in the capital told khaleej times that the increases are even higher than what property companies are reporting in their reports.
One resident who asked not be identified said that the landlords of old buildings which had reasonable rental levels earlier comparing with the new ones are renewing lease agreements according to the prevalent market rates.
An expat who resides on abu dhabi’s airport road told this correspondent that he has just renewed his annual lease for a two-bed apartment for dh65000 against dh49500 he paid last year the dh15000 increase is 30 per cent which is quite high and beyond his paying capacity.
He said that when he approached abu dhabi properties company which manages the apartment building on behalf of a private landlord he was told that the airport road has even a higher ‘’street value’’ of dh70000-75000 for a similar category apartment.
Mat green head of research & consultancy uae cbre said “with affordability fast becoming a concern for many residents there has been a steady rise in demand for more affordable housing options with off-island locations such as khalifa city a and mohammed bin zayed city becoming popular choices for the more budget focused tenants.”
He said residential units within master-planned developments in mainland locations including al reef downtown al ghadeer and hydra village are now commanding rentals that are significantly higher than similar non-community based properties.
According to the cbre report two bedroom apartments within the al reef downtown development currently range between dh80000 –105000 whilst similar property types within the aforementioned mainland locations have rentals from dh65000-85000.
Annual rents for a typical two bedroom city centre apartment are now observed between dh95000–130000 whilst similar residential units within prime developments have rentals between dh150000 –210000 according to cbre report.
With most of abu dhabi’s prime residences having been completed within the past three years rentals have actually remained relatively stable even after the removal of the rent cap green said.
Residential sales rates have seen little movement during the quarter typically ranging between dh10225–15070 for areas such as al raha beach and reem island.