Concerned your rent might be on the rise? With Abu Dhabi’s new Rental Index in play, it just might! This game-changing tool is shaking up the market, and you could see increases of up to 30%—depending on where you live. But why is this happening, and what does it mean for you? Let’s break it down and see what’s really going on.
Landlords Are Using the Rental Index to Adjust Prices—Here’s What You Need to Know
Right now, owners all over Abu Dhabi are taking a second look at their rates, and the new index is their guide. In areas where prices have lagged behind, tenants might be facing increases—especially in prime spots like Al Reem Island and Saadiyat Island. Demand in these areas is high, and landlords are now feeling empowered to match their rates to market trends.
Is this the same as the Dubai Rent Calculator?
In short, no. This doesn’t show how much landlords can raise the rent like the Dubai version. This is for information only, a way for the new Abu Dhabi Real Estate Center (ADREC) to share information with interested parties.
Curious to see the rental index for yourself? Check out the Abu Dhabi Rent Calculator here and explore the data firsthand!
Is This the End of Affordable Rents? Not Exactly…
Before you worry too much, remember that the index isn’t just pushing prices higher. It’s also helping bring more balance to the market. Outdated rates are getting updated, but in some cases, they might actually stabilize or even drop in overvalued areas. It’s all about levelling the playing field—some people will see increases, while others might finally catch a break.
For example, by Q2 2024, prices have been creeping up—apartments saw a modest 1% rise this quarter and a 2% increase annually, while villas jumped by 5% annually. The highest spikes are happening in specific communities where demand is driving rates up by 10% or more. So, it’s safe to say the market is on the rise, fuelled by more people moving to Abu Dhabi and the non-oil sector growing by a record 9.1% last year!
Worried About Rent Hikes? Abu Dhabi’s Rent Cap Law Has Your Back
For existing tenants, there’s some good news! The rent cap law limits how much your landlord can raise your costs each year. Under Law No. 20 of 2006 (Article 16), increases are capped at 5% when you renew your lease. So, if you’re sticking around, you won’t be hit with any sudden, wallet-busting hikes. Your contract will stay predictable, and landlords must follow the rules—unless the Executive Council steps in, of course, but that’s rare.
Whether you’re feeling the pinch of rising prices or looking for a better deal, understanding how this new Rental Index works can help you make smarter decisions. At Crompton Partners, we’re here to guide you every step of the way! Call us at 800-2732 or email enquiries@cromptonpartners.com—we’ll help you navigate this evolving market and find the best options for you.
