Rents for apartments in several communities in Abu Dhabi have gone up, defying the trend observed in the neighbouring city of Dubai, according to a new report.
Property analysts said on Thursday that almost half of the apartment communities they tracked in the UAE capital experienced increases in asking rents over the past several months, particularly during the second quarter and third quarter of 2017. Several other areas also registered “larger” upticks.
Rents for flats in Mohammed Bin Zayed City (MBZ) went up by 13.8 per cent, while those in Al Mushrif and Electra Street jumped by 12.8 per cent and 8 per cent, respectively.
MBZ is considered one of Abu Dhabi’s most affordable communities, with rents averaging just Dh55 per square foot. The area, as well as Al Mushrif, is home to a number of large villas, some of which have already been converted into studios and one-bedroom apartments.
The increases, however, should not be taken as a sign that the property market in Abu Dhabi has rebounded, according to Propertyfinder Group, which compiled the data.
“All [communities that posted increases] are non-freehold and relatively affordable communities with limited stock, so these rises in the median price shouldn’t be read as a market recovery,” said Lukman Hajje, chief commercial officer of Propertyfinder Group.
Other areas like Corniche, Al Ghadeer, Al Raha Beach, Al Reem Island and Al Bateen, registered rental declines of between 5 per cent and 7.8 per cent, which are more in line with the rest of the country.
Rents across Dubai have been going down, and last year alone, all the locations registered an average rental decrease of 13 per cent compared to a year earlier, according to a report by Asteco. Last year’s decline is the highest since 2014.
In Abu Dhabi, the slowdown in the rental market is more evident within the villa communities, with properties in Al Salam Street, Al Reef and Al Raha Gardens seeing the biggest falls, from -5.9 per cent to -12 per cent, over the reported period.
Looking to invest in ready or off-plan property in Sports City?
Get in touch with a Dubai Sports City expert.