Abu Dhabi rents rocket upwards
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News on Middle East
15 May 2008
Abu Dhabi has witnessed what is quite possibly the largest average annual rental growth ever recorded in the UAE in the year up to the end of March, with rents rising by 24%, according to a fresh survey compiled by Asteco.
The largest rent incresaes were for villas, with average annual rents appreciating by 57%, due to extremely strong demand, with occupancy levels reaching close to 100%.
Unlike neighbouring Dubai, where it is feared that there will soon be a total oversupply of properties, in Abu Dhabi, there is currently a reported housing shortfall of around 20,000 units. The supply of housing stock remains scant, partly because Abu Dhabi is not part of a community master-plan like those pioneered by Emaar and Nakheel in Dubai.
Supply constraint in relation to demand, combined with soaring building material and labour costs, effectively forced average property prices in Abu Dhabi upwards by around 30 per cent last year, according to HSBC.