Tale of two cities: Residents from other emirates working in Abu Dhabi say they are circumventing the law to beat steep rents in the capital Image Credit: GULF NEWS ARCHIVES

Abu Dhabi: Living in Dubai and claiming house rent allowances from your workplace in Abu Dhabi may not be in line with the capital’s laws, but many are doing just that, XPRESS has found.

According to Abu Dhabi’s new regulations, announced in September 2012, all Abu Dhabi government employees are required to live in the capital and show relevant tenancy contracts plus utility bills in order to continue enjoying housing benefits.

However, several expats say they are left with no choice but to find ways in order to remain in their current locations. “Not only is it a matter of saving, but also about convenience. My wife teaches at a school in Dubai while my kids go to another school nearby. They have their friends in this community they won’t want to part with,” said a British expat on why he has not been able to make the move since the new law came into effect in September 2013.

“I had to take up an apartment in the capital to show I have an address there, but in reality, I have sub-leased it to a few singles,” said the professional who didn’t want to be named.

Following the decree, many employees relocated to the capital and its surrounding areas to avoid having to forego HRA.

However, the lure of their existing lifestyle and cheaper rents outside the capital have forced several to devise new strategies to beat the rule.

Indian Sathish Gopal (name changed), a quality control analyst in an oil company in Abu Dhabi, pays two rents every month – one for his two-bedroom apartment in Sharjah where his family lives and another for his two bedroom apartment in the capital where he stays through the week with his colleagues.

“It works for me. The company requires an Abu Dhabi tenancy contract and utility bill as proof that I reside in the emirate for my house rent allowance. I use that to pay the rent for my actual home in Sharjah, while we split the rent in Abu Dhabi,” he said.

Rents also seem to play a major factor in people wanting to stay in Dubai.

According to commercial property and real estate services adviser CBRE, rents in Abu Dhabi’s prime locations shot up by 10 per cent in only the first quarter, while rentals for off-island homes hiked by 14 per cent,

On a year-on-year basis, rents in Abu Dhabi are almost 20 per cent more expensive since there is no longer a five per cent rental cap.

“I initially took up an apartment in Abu Dhabi while I was still renting a place in Dubai only for the sake of trying it out. Sadly, neither my wife nor I could adjust to the new environment. In other Abu Dhabi locations where we thought we could stay, the rents are sky-high. So we got back to Dubai, ending up sub-leasing the [Abu Dhabi] apartment to bachelors, at least for this year,” said a South African consultant at an Abu Dhabi engineering firm.

Property analysts believe part of this upturn stems from regulations relating to Abu Dhabi Government employees.

“Many have made the switch but several have stayed on for lifestyle choices even though in reality there isn’t much difference at all between what the two emirates have to offer today. Even the bridge in the rental divide is slowly closing. More and more schools and hospitals are coming as well,” says a real estate expert based in the capital.

According to him, locations like Reem and Yas island offering quality apartments are fast filling up even though he admits many may actually still be living in Dubai.

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