Abu Dhabi desperately needs new residential units, reports Bayut.com

The rule which required the government employees of Abu Dhabi to live within the emirate is scheduled to come into effect in September and following the execution of the new law, property experts at Bayut.com are of the view that Abu Dhabi is set to see a rise in demand for residential real estate. It is also believed that while the real estate demand is expected to rise in Abu Dhabi, some particular segments of the property market, probably those at the low end may experience no change at all.

The precise law, which was designed for the betterment of the real estate of Abu Dhabi, was announced last year so that people may get the time required for shifting from one emirate to another. According to reliable authorities, the rule shall affect 23,000 government employees who travel from their homes in Dubai to their offices in Abu Dhabi.

In order to effectively execute the rule a dire consequence is set to be faced by the employees who fail to relocate within the required time and that could come in the form of employees losing their government housing allowances. According to the research analysts at Bayut.com, the frequently searched property statistics depict that people are actually looking tor adequate units in Abu Dhabi which could be comparable to their units in Dubai in terms of luxury and quality.

The property listing analysts at Bayut.com are of the view that Abu Dhabi, much like Dubai property market, desperately needs new real estate developments of all types. The luxurious housing preferences are particularly high in demand and many people are pursuing fresher alternatives in residential developments like Al Reef, Al Raha Beach and Reem Island.

It was also observed that, very strikingly, while the housing rule may be improving rental rates for high end properties, the same upshot has not been perceived in the lower end of the market. During the second quarter of the current year, rental prices for prime two bedroom apartments were seen to be stable at a rate of DH 129,989 per year ($35,365), following an 8 per cent growth in the first three months of 2013, while secondary residential rates experienced an unrelenting fall. This shows that while the foreign investors sometimes have to pay perhaps an arm and a leg for the residential requirements of the UAE, the government employees face little difficulty in relishing the luxury provided by the emirates.

Bayut.com dubs this growth as moderate and in part to the new government housing rule, but it is also to be noticed that this may prove to be an offset in the coming months as additional supply continues to come into the market. It is estimated that nearly 2,300 units were added to the residential stock in the second quarter, including at Hydra Village Tala Tower on Al Reem Island, Capital Centre, Al Wifak Tower and Saadiya beach according to the property database of the website.

However, property experts regard the overall trend during the first half of the current year as encouraging for the property market of Abu Dhabi as the official and residential rents are witnessed to have been stabilised and retail and hospitality sectors have also experienced improved performance. A long term recovery is expected if Abu Dhabi is to continue its economic growth. While a stimulating demand for residential, office and retail space is seen in the real estate market, it appears that perhaps the worst of the 2008 slump may be over.