7 Days

Abu Dhbai, Mar 5: The price of homes in Abu Dhabi could rise by at least 20 per cent this year as demand outweighs supply and negative real interest rates fuel investment, Sorouh Real Estate claims.

Europeans are investing in the UAE looking to use their stronger euro as the dollar declines, taking the UAE dirham with it, Gurjit Singh, Sorouh’s chief property development officer told an investment conference. A surge in oil prices has boosted Abu Dhabi’s economy and low interest rates have spurred real estate investment.

“We should easily see a growth of 20 per cent this year,” Singh said. “What we are seeing now is a growth phase. We are still very early on the clock.”  Average residential real estate prices range between dhs1,300 and dhs1,700 per square foot, he said.

Europeans buying residential property in Abu Dhabi account for between eight and twelve per cent of the emirate’s real estate market.

“It is rising because of the strength of the euro and the pound,” Singh said.

Meanwhile, commercial sector prices are set to head the same way, according to property group Goodman, which yesterday launched a joint venture with Sorouh for the development and management of business and logistics parks. “Goodman Sorouh is very positive about the pricing outlook for commercial propert,” Goodman’s Middle East managing director Richard Draycott told 7DAYS.

He believes “domestic and international companies wish to have a strong and expanding presence in Abu Dhabi” and that this will affect office and industrial sector prices.