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29 March 2024

Abu Dhabi prices, rents remain stable in Q3

Published
By Staff

The Abu Dhabi real estate market was left relatively unchanged, with little or no movement on average in residential sales or leasing prices, according to Asteco.

Modest price increases and decreases were recorded in localised communities, however growing confidence and improved investor sentiment is likely to support sustainable growth in the short to medium term, the consultancy said in its Q3 2014 real estate report.

Although average apartment sales prices changed little quarter-on-quarter, a 28 per cent increase was witnessed annually to end of third quarter 2014. This trend was mirrored by villa sales prices, which were flat during the third quarter, despite the limited availability of stock, but still achieved an average annual increase of 14 per cent across the market.

“The popularity of developments within investment areas is a trend that continues to be simulated quarter on quarter as sales prices firm up. The sales volumes achieved by Aldar on the Ansam and Al Hadeel projects at Al Raha Beach and Yas Island have highlighted the robust demand for the right type of product within Investment Zones,” said Jerry Oates, General Manager, Asteco Abu Dhabi.

“Market sustainability will be enhanced still further by a range of new to market developments in 2015, this, combined with a more transparent market for UAE national investors through Abu Dhabi’s rental index, which benchmarks and regulates maximum rental increases will encourage future growth in the UAE capital,” he added.

Growth for low to mid-end apartment unit developments, such as Reef Downtown, dropped a further two per cent in the third quarter, implying that the first quarter 2014 prices highlighted a peak for the area. Prices, however, ranged from Dh900 to Dh1,100 revealing an impressive 52 per cent year-on-year increase. Raha Beach/Al Muneera were static, asking prices were nudging Dj1,500 per square foot, bringing year-on-year growth to a healthy 24 per cent.

A three-bedroom home in Hydra Village remained at Dh 1.3 million recording year-on year growth of 21 per cent,  while standard Saadiyat Beach Villas topped out at Dh5.5 million for three bedrooms, highlighting an 11 per cent increase annually.

Rental rates for prime residential apartments in Abu Dhabi remained relatively stable with certain developments such as Sun & Sky Towers achieving close to full occupancy. Rates in Marina Square witnessed a decrease of 3 per cent, as Reem Island became more competitive due to a number of new units coming on line, including The Gate Towers.

For low end properties on Abu Dhabi Island, including Central Abu Dhabi, the Corniche and Khalidiya/Bateen, a quarter-on-quarter decrease of five per cent, two per cent and four per cent, respectively with prices for a two-bed apartment topping out at Dh90,000, Dh80,000 and Dh100,000 for each location. Investment areas such as Reef Downtown saw no growth quarter-on-quarter however witnessed an annual increase of 26 per cent.

The rental market for villas echoed that of apartments as high-end villa rental rates remained stable despite limited new supply. A three-bed property on Abu Dhabi Island in Bloom Gardens saw a quarter-on-quarter increase of five per cent averaging between Dh190,000 and Dh240,000.

Affordable locations, including Hydra Village and Al Reef, leased for Dh95,000 and Dh140,000 per annum respectively, representing annual growth of two per cent and 11 per cent, respectively.