UAE | Housing & Property

Government staff resort to trickery to retain housing allowance

As relocation deadline nears, many rent apartments in Abu Dhabi only to sublease them later

  • By Anjana Sankar, Senior Reporter
  • Published: 21:00 August 21, 2013
  • XPRESS

  • Image Credit: Gulf News Archives
  • Circumventing the rule: Real estate agents say many public sector employees living in Dubai and other emirates are taking up studios and one-bedroom apartments in the capital before subleasing them to others with the express aim of getting a tenancy contract

Abu Dhabi: Government employees living in Dubai have resorted to desperate measures to honour a new rule which requires them to furnish a tenancy contract from Abu Dhabi or lose their housing allowance.

As the deadline for the relocation nears, many public sector employees are hoodwinking authorities by renting one-bedroom and studio units to get tenancy contracts but continuing to live in Dubai. And lest it pinches their pocket, some are violating the law by subleasing the apartments.

Subleasing

Abu Baker, an agent with Proper Real Estate in Abu Dhabi said: “I am getting a lot of calls from government employees looking for studios or one-bedroom units. There are not many left as most have already been taken.”

Aslam P.K., another agent said families with three-four children do not want to move to Abu Dhabi. “Sometime back, a Jordanian man approached me for a three-bedroom villa. But when I quoted the price (around Dh200,000), he said he wanted to take a one bedroom for Dh50,000 and asked for help to sublease it,” said Aslam.

According to agents, a one bedroom starts from Dh55,000 in areas like Tourist Club, Airport Road, Khalidiya etc.

The rents for studio apartments are between Dh40,000 and Dh45,000.

Though subleasing is illegal, many families and bachelors continue to live in shared apartments because of high rents.

A Syrian working for the Abu Dhabi National Drilling Company said he did not wish to relocate to Abu Dhabi from Sharjah because he does not want to disrupt the schooling of his children.

“I have three kids aged between five and 13. We live in a spacious three-bedroom apartment in Sharjah for which I pay Dh72,000 per year.

“My kids go to a good school. I do not want to uproot them and start afresh in Abu Dhabi where a similar size apartment would cost a fortune,” said the 44-year-old who did not wish to reveal his identity.

Around 10,000 government employees will be affected by the decision of the Executive Council taken last September which directed government employees to live in Abu Dhabi or forfeit their housing allowance. Those who fail to produce an Abu Dhabi tenancy contract will not be able to renew their residency visas any more.

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Rents decline in second quarter

A spike in relocation of Abu Dhabi government employees to the capital from other emirates has boosted leasing activity across the city but rents overall declined by four per cent in the second quarter as developers released new units. Property consultants CBRE reported that rents in the capital dropped by 10 per cent over the past year. Abu Dhabi’s residential stock grew by nearly four per cent annually. The consultancy said up to 45,000 new units are due for delivery in the next three years.

Comments (3)

Your comments
  1. Added 10:32 August 22, 2013

    It's discouraging residents from other emirates to work in Abu Dhabi. Rentals there are more expensive and people are mostly comfortably setup in other emirates. Why does the government want to make it mandatory for employees working in Abu Dhabi to stay in Abu Dhabi? Not a rational idea absolutely.

    Z, dubai, United Arab Emirates

  2. Added 00:59 August 22, 2013

    Undue pressure on families and society what goes around comes around

    fahim, edmonton, Canada

  3. Added 23:01 August 21, 2013

    Our employer told us to stay anywhere in Abu Dhabi emirate (even western region or Al Ain) which are 2 hours drive from city but not in Dubai Marina which is only 1 hour distance from office. We urge them to listen to residents who love to live in Dubai and who have kids studying or spouse working in Dubai and it is impossible for us to move.

    Dr Leena, Dubai, United Arab Emirates

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