Abu Dhabi’s real estate landscape is undergoing swift changes after the launch of the Emirates’s first official rental index by the Abu Dhabi Real Estate Centre (ADREC).
This index aims to enhance market transparency and provide both landlords and tenants with reliable data on the rental process across the regions of Abu Dhabi. In addition to determining the fair rental values, the index serves to improve the competitiveness of the Abu Dhabi real estate sector with a view of attracting more international investors.
Impact on rental prices
According to the reports, new tenants may face rental increases of up to 30 per cent in some areas where current rates are below the market average. This surge is attributed to a combination of high demand from new residents and a limited supply of available properties.
It is pertinent to mention that the rental index, a statistical tool that tracks changes in rent over time is designed to help tenants understand market conditions better and poetically negotiate more favourable terms in areas where rents exceed the index figures.
As per the reports, in the second quarter of the year 2024, apartment rents in Abu Dhabi increased by around 2 per cent yearly, and the rents of villas, increased by 5 per cent yearly.
The two averages of annual rent for apartments are AED 66,375 and AED 166,261 for villas. The overall rental market is stated to be ‘on the recovery’ due to population increase and non-oil sector diversification which has grown by a record 9%. 1% year-on-year in 2023.
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