Taylor Scott International News
Property prices in Abu Dhabi are expected to see a gradual increase in 2015 but not on the scale that was seen in 2104, it is claimed. Leading property firm Cluttons believes there is still some great investor appetite in Abu Dhabi and predicts that new residential schemes will still be popular. It also expects that there will be more off-plan housing launches this year, from the leading firms such as Aldar and TDIC as well as some private developers. But William Neil, head of Cluttons in Abu Dhabi warned that there is a danger that residential rents could continue to go up. ‘With no rental cap in place in Abu Dhabi, if there is a lack of supply then the market could face some of the same issues it faced back in 2007 when rents were so expensive that many people were forced to commute here each day from Dubai,’ he explained. He added that the commercial market is waiting with anticipation to find out what the new rules will be regarding the proposed financial free zone on Al Maryah Island. ‘With Yas Mall now open, we are predicting growth for retail rents in the city. However, with more shopping centres being built on Al Maryah Island and Saadiyat Island, there is a danger over the next three years for oversupply,’ he said. Meanwhile, in neighbouring Dubai the New Year is expected to see a mixed outlook with some sectors of residential property selling well but prices and sales varying depending on location. According to Matthew Green, the head of research and consultancy for the United Arab Emirates at CBRE Middle East the residential market has shown signs of stabilisation over the past six months across both sales and leasing markets. ‘We expect this to be a similar outlook for this year, with the scheduled pipeline of 20,000 new units during the year likely to help constrain rental inflation and add more balance to the sector,’ he said. ‘As has been the trend, a fragmented market will continue, with certain products and locations performing somewhat independently from the wider market. For example, the villa market, which has been relatively stable in recent quarters, could be set for rental deflation in certain areas as a substantial supply of new units starts to emerge from locations such as Jumeirah Park, Arabian Ranches, Dubailand and Jumeirah Golf Estates,’ he explained. ‘The demand for mid to low end residential offerings is expected to remain strong in the short term because of limited supply and high demand. Much of this demand is being generated by solid growth in the services sector, particularly from the retail and hospitality industries,’ he added. Dubai’s commercial office sector saw improvement in 2015 and this is expected to continue into 2015 and Dubai’s position as the headquarter city of choice for global corporates in the Middle East looks set to continue. ‘However, with limited good quality and efficient office properties available in the… Taylor Scott International
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