When asked if he'd like to leave his position as the head of Knight Frank's office in the Birmingham suburb of Sutton Coldfield to take the helm as head of the firm's operations in the Middle East, Christian Swaab jumped at the opportunity to "investigate one of the most exciting and impressive parts of the residential world".

Having made the move in August 2011, Christian has had time to settle in and assess his markets and the challenges he faces - not least the absence of a residential postal system. 

Here he discusses prime property trends in Abu Dhabi and Dubai, where the emerging hotspots are, and how he thinks activity will fare in the coming months. 

How has the luxury housing market been affected by the recent political turmoil seen in the Middle East?    

Both Dubai and Abu Dhabi are seen as areas of relative calm from the Arab Spring uprisings for those looking to invest their money in property. Businesses have also seen these two Emirates as geographical vantage points for global operations, as key markets including the Far East are within relatively short flying times. Prime residential prices did however fall in Dubai by around 3% in the year to December. The highest recorded price paid for residential property is £14,000/sqm in Dubai and £5,750/sqm in Abu Dhabi. 

What impact has the credit crunch had on new developments? 

Abu Dhabi has proceeded with caution, vastly slowing down the large area-wide developments seen in its ambitious 2030 plan. There is a need for rental properties that match the quality of those in Dubai, where tenants have a wider choice of prime as well as cheaper alternatives. Dubai is littered with both half-finished and barely started schemes that were ambitious, overblown and frankly mystifying, all conceived during the heady days of 2007 and 2008. This has created the negative press seen in Europe. 

Which prime areas are most in demand?  

In Dubai, the established areas of The Palm Jumeirah and Emirates Hills remain sought after due to their convenient location and the local environment. A number of well-designed buildings near Dubai Marina are also in strong demand. These areas are within an hours' drive of Abu Dhabi. In Abu Dhabi, the Saadiyat Beach Villas scheme on Saadiyat Island has attracted strong initial off-plan sales activity, driven by members of the ruling families.  Al Bandar in the Al Raha Beach area of Abu Dhabi offers well-designed and well-serviced waterside living and is just a 45-minute drive from Dubai, making it popular with the ex-pat market. 

Are there any emerging hotspots?   

The Al Reem and Sowwah Island developments in Abu Dhabi are providing attractive alternatives to the congested main Abu Dhabi island. Although the schemes are approximately four years behind counterpart areas in Dubai, this will be a strong area for investment as schemes start to complete. In Dubai, areas around Downtown Dubai are proving increasingly popular due to their proximity to the Burj Khalifa, Dubai Mall, and the Dubai Internal Financial Centre, which is an offshore business environment. Golf-orientated schemes such as Jumeriah Golf Estates are looking to gain momentum as the master planner has now committed to finishing off the necessary infrastructure. This infrastructure should be complete by early summer 2012.

Which nationalities are prevalent in the market?

In Abu Dhabi the availability of freehold purchase areas is limited, but the exclusive Nurai Private Island located off the Saadiyat Island attracts Indian, Russian and some European buyers. Dubai has the same mixture of buyers as well as strong interest from other Gulf Cooperation Council (GCC) countries such as Saudi Arabia, Bahrain, Kuwait, Oman and Qatar. Asian buyers are also starting to show interest.

How important are expats to the prime property market? 

They are not particularly important for freehold purchasing in Abu Dhabi due to the limited availability. They are however important to the rental market due to the sheer numbers living in the Emirates. Competition for rental costs is increasing due to the larger number of properties now available. Expats are an important ingredient in Dubai.

What are the typical property styles in the prime markets?

In Abu Dhabi they tend to be expansive two-storey centrally located villas ranging in size from 10,000 sq ft up to 30,000 sq ft. Gardens are generally small as they are not considered important.  Heavy mirrored glazing is common and external architecture tends to be either cubic or heavily Arabesque. Modern properties such as the Saadiyat Beach Villas have a more Mediterranean look and feel, with relatively small plots. These are located closer to, and in some cases on, the beachfront and golf course. In Dubai, traditional prime market villas are located in grid patterns, echoing those in Abu Dhabi. Areas such as the Palm Jumeirah offer a variety of villa styles on the fronds, or stems, of the palm, with direct waterfront access. Emirates Hills offers gated living centred on a golf course. Large apartments in the Dubai Marina area offer high-rise living overlooking the marina.

What properties do investors tend to target?

Investors are interested in both ends of the spectrum - distressed stock left over from the 2009 turmoil as well as the more high-end properties. The best schemes are luring the ex-pat market away from the original selection of poorly designed and questionably located stock. Many tenants, especially ex-pats, are interested in villa living. But the return for investors is not as strong as apartment yields on a comparable basis per square metrer.    

How do you think the market will fare in the coming year? 

A large number of new properties will be released across the board and this will drive rental prices down. Villa prices will remain steady, with prime areas in Dubai seeing a slight upturn due to short supply. Both Emirates will remain popular due to the stability of this part of the Middle East, together with the offer of the tax-free alternative to disillusioned Europeans.  Both Abu Dhabi and Dubai have a lot to offer geographically for commercial and residential purposes, and the fact that the number of flights to both is increasing supports this proposition.

What are the most significant challenges you face?

Dubai is one of the world's most volatile residential property markets and desperately craves credibility. The fact that neither Abu Dhabi nor Dubai has a residential postal system is a further stumbling block.

For more details on the market in the Middle East you can contact Christian by email at christian.swaab@knightfrank.com