Good news for flathunters in Abu Dhabi as new figures show rents have continued to fall, by as much as 10 per cent in some parts of the city
Rents in Abu Dhabi continue to drop after sliding as much as 50% last year
Rents continue to fall in Abu Dhabi as a growing supply of residential property widens options in the market, new data show.
In neighbourhoods such as Mohammed Bin Zayed City and Khalifa City, rents have fallen 10 per cent since the start of the year, after sliding as much as 50 per cent last year, according to a report by the property consultancy Cluttons.
In older neighbourhoods, one-bedroom flats that once rented for about Dh120,000 (US$32,671) a year can now be had for Dh45,000, said William Dewsnap, Cluttons's director of valuations in Abu Dhabi.
Along the Corniche and in other costlier areas, the decline was closer to 5 per cent in this year's first quarter, Cluttons reported.
But even at the top end of the market, rents should continue to fall as more projects are completed over the next few months, Cluttons predicts.
More than 3,000 units are close to handover on Al Reem Island, while an additional 3,000 are in the final stages of construction on Raha Beach.
"It is inevitable that average rental rates will continue to drop as we move into the summer, aided by the new stock coming to the market," Cluttons said in its report.
The new stock coming on to the market is likely to create a period of increased activity as people shop for deals, Cluttons predicted. Lower rents in Abu Dhabi will attract many people who are currently living in Dubai and commuting to work in the capital, Mr Dewsnap said.
"When rents drop, we will see people moving down the road" to Abu Dhabi, he said.
The new housing stock would also prompt increased sales, he added. Buyers had been reluctant to commit to projects that were under construction, he said.
The completed projects would give buyers confidence, and "we will start to see units trade at higher levels than currently", Mr Dewsnap said.
Values for villas are holding up better than apartments, falling on average only 2 to 5 per cent in the quarter, according to Cluttons data.
Beyond the smaller supply of villas, "it is also indicative of the type of people who are coming to Abu Dhabi - more families than individuals or couples," Mr Dewsnap said.