Despite signs that the worst of the global economic crisis has now passed, and with property in the Gulf region having recovered considerably over the last year, the most recent findings show that there has been a decline in both sales and rental values in most sectors of the property market. This has been attributed to an upsurge in new supply entering the local market for the UAE.
Dubai apartments and houses for sale and rent have declined in value more than any other area of the UAE, and as a consequence, there has been an increased demand from residents living in Sharjah to take advantage of falling values in Dubai properties.
However, commercial property in Dubai, particularly office space usage, has witnessed increased interest over the last six months, with tenants taking advantage of the lower rents as well as reflecting a renewed confidence in the overall economic situation in the region.
In Abu Dhabi, there has been a similar decline in value, but at a much lower rate than the fall in Dubai. Abu Dhabi remains one of the more inflexible property sub-markets, with fewer properties available for occupancy in the short term. The low supply has resulted in higher rents for residential and commercial property, though rents are still lower than they were a year ago, partially due to decreased demand because of the financial crisis.
Nevertheless, a series of new developments in Abu Dhabi are expected to re-start in 2010, having been put off in 2008 and 2009 because of the crisis of confidence in the property market. Once property developer and investor confidence is restored, the signs in the overall UAE property market indicate a return to business as usual.
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