The residential property market in Abu Dhabi rebounded strongly in 2013 following a slump and ‘government intervention, according to a Jones Lang LaSalle (JLL) report.
According to JLL that prime residential sales prices soared 25 percent in 2013, posting a six percent increase in Q4 alone.
Prime residential rents jumped 17 percent, partly due to the removal of a five percent cap on rent increases as well as the creation of new jobs.
JLL said Abu Dhabi’s property market slumped by around 50 percent from its 2008 peak after the global financial crisis triggered a crash. The report suggests that Abu Dhabi’s recovery may now be as fast as that of Dubai’s.
Over the last couple of years, Abu Dhabi has been trying to boost its residential market with the introduction of new rules.
To address oversupply, it urged public sector employees residing outside the emirate to relocate within its borders in 2012. Notably, many employees travel daily from Dubai.
Abu Dhabi also removed a five percent cap on annual rent increases last November. The cap was introduced in January 2008 after surging demand pushed inflation and rents higher.
David Dudley, regional director and head of the Abu Dhabi office of Jones Lang LaSalle, said: “a sustainable recovery is dependent on the government continuing to implement further supply controls to ensure a balanced real estate market going forward.”
In the medium term, the Abu Dhabi market looks positive, “but there will be selective strong performers specific to sectors, locations, user requirements, property management and overall infrastructure.”
Nikki De Guzman, Junior Journalist at PropertyGuru, edited this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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