Dubai housing costs rise at fastest pace in three years while Abu Dhabi falls again
Dubai housing costs, as measured by the emirate's consumer price basket, accelerated at their fastest pace in more than three years last month.
In contrast, the housing and utility costs component of the Abu Dhabi index dipped by 0.6 per cent last month compared to the same month of last year, showed data released yesterday by the Statistics Centre Abu Dhabi. The same part of the Dubai index rose 0.8 per cent during the same period, the steepest rise since January 2010, data from Dubai Statistics Centre showed.
The data reflect the different stages of recovery within the property markets of both emirates.
"The rise in rents in Dubai is something we see as a trend," said Farouk Soussa, the chief economist in the Middle East for Citigroup. "Going forward we expect further increases in rent in Dubai as we forecast house prices to rise by 35 per cent this year and rents to be not far off it."
The Abu Dhabi housing market was a different picture, he said.
"The rate of population growth in Abu Dhabi is still short of Dubai and the investment interest in Dubai's property market is higher than Abu Dhabi," he said.
Housing and utility costs have the single biggest weighting in the indexes of both emirates.
Overall inflation in Dubai climbed 0.9 per cent last month from the same period of last year, higher than the 0.6 per cent annual rise during the month before. During the month, inflation remained steady, with a 0.1 per cent lift from the previous month.
Overall consumer prices in Abu Dhabi climbed 0.6 per cent last month from the same period of last year. Prices of alcoholic beverages and tobacco increased by the highest amount, climbing 9.7 per cent over the same period.
On a monthly basis, overall inflation in Abu Dhabi dipped 0.2 per cent from the previous month.
Published: May 16, 2013 04:00 AM