Renters in Abu Dhabi are continuing to downsize to more affordable apartments as lower oil prices cast a shadow over the emirate’s economy, according to the property consultancy Asteco.
Julia Knibbs, the company’s UAE associate director of research and consultancy, said that renters are not only seeking moves to more affordable areas, but also to more affordable units within existing communities.
“If you take some of the prime developments on the Corniche, the units that have the highest vacancies would be the special units like the big, three-bedroom, four-bedroom and the extra large two bedrooms,” she said. “These are seeing less demand. It’s not that people are leaving the country, but they are a bit more budget-conscious.”
Asteco’s new first-quarter property report for Abu Dhabi shows that apartment rents across the city fell by 2 per cent quarter-on-quarter, with the most pronounced declines occurring on Reem Island as more new stock came on to the market.
Apartment rents in Shams Abu Dhabi dropped by 6 per cent quarter-on-quarter, ranging from Dh95,000 to Dh120,000 for a one-bed unit, or Dh130,000 to Dh170,000 per year for a two-bed. Rents also fell by 5 per cent in the Khalidiya/Al Bateen area and 3 per cent on the Corniche. There was virtually no decline in rents at the lower end of the market. Villa rents remained stable, with units at the higher end of the market increasing slightly owing to a lack of quality stock.
Ms Knibbs said that the market for selling homes remained subdued. “Very few transactions are happening at the moment,” she said. “People are still waiting to see what will happen. People don’t want to take the step of buying right now, but there are also not many sellers.”
The most marked decline in asking prices during the quarter was again at Reem. Prices fell by 6 per cent at The Gate and Marina Square, and by 5 per cent at Sun & Sky Towers.
Ms Knibbs said she did not expect further deterioration in prices because supply remains limited. Just 1,500 new units were launched during the first three months of the year, and these are not likely to be delivered for another three years.
“The UPC [Urban Planning Council] has a plan for the city and there’s only so much that gets approved. It’s not as deregulated as Dubai, where new projects are launched all of the time without any proper agreement about whether it makes sense or not. There’s more faith, because supply is controlled.”
She also pointed to the recent statement from ratings agency Moody’s, which stated that it expects Abu Dhabi’s government to slow the pace of spending cuts in its 2016 budget to sustain growth.
“If that happens, it’s a very positive thing for Abu Dhabi because there is so much related to market sentiment. If there are no further cuts, maybe that is going to improve confidence, lead to more spending and maybe people being a bit less cautious about buying property.”
Last week, Mathias Angonin, a sovereign analyst at Moody’s said it expected that “in 2016 there will be a lower decrease in spending that the 20 per cent achieved in 2015”. “We expect Abu Dhabi government’s fiscal consolidation effort to slow because of the need to balance the two objectives of supporting growth and curbing the budget deficit,” he said.
mfahy@thenational.ae
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Killing of Qassem Suleimani
A timeline of the Historical Dictionary of the Arabic Language
- 2018: Formal work begins
- November 2021: First 17 volumes launched
- November 2022: Additional 19 volumes released
- October 2023: Another 31 volumes released
- November 2024: All 127 volumes completed
UAE currency: the story behind the money in your pockets
UAE v Ireland
1st ODI, UAE win by 6 wickets
2nd ODI, January 12
3rd ODI, January 14
4th ODI, January 16
Abaya trends
The utilitarian robe held dear by Arab women is undergoing a change that reveals it as an elegant and graceful garment available in a range of colours and fabrics, while retaining its traditional appeal.
Company%20Profile
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The Sand Castle
Director: Matty Brown
Stars: Nadine Labaki, Ziad Bakri, Zain Al Rafeea, Riman Al Rafeea
Rating: 2.5/5
Start-up hopes to end Japan's love affair with cash
Across most of Asia, people pay for taxi rides, restaurant meals and merchandise with smartphone-readable barcodes — except in Japan, where cash still rules. Now, as the country’s biggest web companies race to dominate the payments market, one Tokyo-based startup says it has a fighting chance to win with its QR app.
Origami had a head start when it introduced a QR-code payment service in late 2015 and has since signed up fast-food chain KFC, Tokyo’s largest cab company Nihon Kotsu and convenience store operator Lawson. The company raised $66 million in September to expand nationwide and plans to more than double its staff of about 100 employees, says founder Yoshiki Yasui.
Origami is betting that stores, which until now relied on direct mail and email newsletters, will pay for the ability to reach customers on their smartphones. For example, a hair salon using Origami’s payment app would be able to send a message to past customers with a coupon for their next haircut.
Quick Response codes, the dotted squares that can be read by smartphone cameras, were invented in the 1990s by a unit of Toyota Motor to track automotive parts. But when the Japanese pioneered digital payments almost two decades ago with contactless cards for train fares, they chose the so-called near-field communications technology. The high cost of rolling out NFC payments, convenient ATMs and a culture where lost wallets are often returned have all been cited as reasons why cash remains king in the archipelago. In China, however, QR codes dominate.
Cashless payments, which includes credit cards, accounted for just 20 per cent of total consumer spending in Japan during 2016, compared with 60 per cent in China and 89 per cent in South Korea, according to a report by the Bank of Japan.
It's up to you to go green
Nils El Accad, chief executive and owner of Organic Foods and Café, says going green is about “lifestyle and attitude” rather than a “money change”; people need to plan ahead to fill water bottles in advance and take their own bags to the supermarket, he says.
“People always want someone else to do the work; it doesn’t work like that,” he adds. “The first step: you have to consciously make that decision and change.”
When he gets a takeaway, says Mr El Accad, he takes his own glass jars instead of accepting disposable aluminium containers, paper napkins and plastic tubs, cutlery and bags from restaurants.
He also plants his own crops and herbs at home and at the Sheikh Zayed store, from basil and rosemary to beans, squashes and papayas. “If you’re going to water anything, better it be tomatoes and cucumbers, something edible, than grass,” he says.
“All this throwaway plastic - cups, bottles, forks - has to go first,” says Mr El Accad, who has banned all disposable straws, whether plastic or even paper, from the café chain.
One of the latest changes he has implemented at his stores is to offer refills of liquid laundry detergent, to save plastic. The two brands Organic Foods stocks, Organic Larder and Sonnett, are both “triple-certified - you could eat the product”.
The Organic Larder detergent will soon be delivered in 200-litre metal oil drums before being decanted into 20-litre containers in-store.
Customers can refill their bottles at least 30 times before they start to degrade, he says. Organic Larder costs Dh35.75 for one litre and Dh62 for 2.75 litres and refills will cost 15 to 20 per cent less, Mr El Accad says.
But while there are savings to be had, going green tends to come with upfront costs and extra work and planning. Are we ready to refill bottles rather than throw them away? “You have to change,” says Mr El Accad. “I can only make it available.”
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
On sale: Now
Company%20Profile
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FIGHT%20CARD
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Kill%20Bill%20Volume%201
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UAE currency: the story behind the money in your pockets
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
BULKWHIZ PROFILE
Date started: February 2017
Founders: Amira Rashad (CEO), Yusuf Saber (CTO), Mahmoud Sayedahmed (adviser), Reda Bouraoui (adviser)
Based: Dubai, UAE
Sector: E-commerce
Size: 50 employees
Funding: approximately $6m
Investors: Beco Capital, Enabling Future and Wain in the UAE; China's MSA Capital; 500 Startups; Faith Capital and Savour Ventures in Kuwait
Fixtures and results:
Wed, Aug 29:
- Malaysia bt Hong Kong by 3 wickets
- Oman bt Nepal by 7 wickets
- UAE bt Singapore by 215 runs
Thu, Aug 30:
- UAE bt Nepal by 78 runs
- Hong Kong bt Singapore by 5 wickets
- Oman bt Malaysia by 2 wickets
Sat, Sep 1: UAE v Hong Kong; Oman v Singapore; Malaysia v Nepal
Sun, Sep 2: Hong Kong v Oman; Malaysia v UAE; Nepal v Singapore
Tue, Sep 4: Malaysia v Singapore; UAE v Oman; Nepal v Hong Kong
Thu, Sep 6: Final
Wicked
Director: Jon M Chu
Stars: Cynthia Erivo, Ariana Grande, Jonathan Bailey
UAE currency: the story behind the money in your pockets
