In the end, what is the effect on the market of Abu Dhabi's requirement for government workers to reside in the emirate? JB, Fujairah
For those employees who wanted to avail themselves of the housing allowance given to them from Abu Dhabi government-based companies, the choice to move locally was, in the end, a no-brainer. Although many left it to the very last moment, thinking that the change of law would not come into effect, the ones that acted quickly were able to get hold of alternative properties in the right locations but more importantly at lower prices. As time moved on, landlords jumped on to the ever- expanding bandwagon by inflating their rental asking prices to take advantage of the rising number of inquiries for residential property to rent. Numbers of people affected were estimated to be close to 20,000. This has helped to contribute to a recovery in prices in Abu Dhabi.
Some call this recovery a one-off that will not last as these employees are now sorted and hopefully happy in their new abodes, but the residential rental market is well on its way to recovery and finally mirroring increases in Dubai.
One of the main reasons for these increases is the apparent shortage of residential property and the present shortage is because of delays in handing over buildings. This will even itself out as these properties eventually find themselves on the open market.
The increasing demand for residential rents appears to be coming from private and public sector employees. Schools have been recruiting heavily to attract teachers. The healthcare sector has also been very active in finding accommodation for workers, while Etihad Airways is moving forward with expansion plans and in doing so is recruiting heavily.
That is only a snapshot of employment activity within the capital. All of the above are contributing to the increase in property related activity. This, coupled with the positive sentiment that the country as a whole is feeling, adds up to a return in confidence for the Abu Dhabi property market.
Mario Volpi is the managing director of Prestige Real Estate in Dubai. He has 29 years’ of property industry experience in the emirate and London. Send any questions to mario@prestigedubai.com
