Property Prices in Prominent Communities in the Capital Show Marked Improvement

Press release
Published April 26th, 2021 - 07:32 GMT
Property Prices in Prominent Communities in the Capital Show Marked Improvement
Abu Dhabi Q1 2021 Rental Market Report.
Highlights
According to Bayut & dubizzle’s Abu Dhabi property market reports for Q1 2021, sales and rental prices in the capital city have shown promising gains in many key communities. 

According to Bayut & dubizzle’s Abu Dhabi property market reports for Q1 2021, sales and rental prices in the capital city have shown promising gains in many key communities. 

Based on Bayut & dubizzle’s Q1 2021 property market reports, sales prices for residential property in Abu Dhabi has experienced increases of up to 5% in popular neighbourhoods.

  • Potential investors and buyers in search of affordable apartments have favoured freehold suburban areas like Masdar City and Al Reef, while those interested in luxury apartments have shown a preference towards Al Reem Island. 
  • Al Reef has continued to remain the top choice for affordable villa sales, while waterfront communities such as Yas Island and Saadiyat Island have held strong with those interested in purchasing upscale villas. 
  • Prospective tenants with a smaller budget have preferred apartments in suburban communities or centrally-located neighbourhoods such as Khalifa City A and Al Khalidiyah. On the other hand, waterfront areas like Al Reem Island and Al Raha Beach have remained popular for luxury apartment rentals. 
  • Mohammed Bin Zayed City has remained the top choice for renters in search of budget-friendly villas and Al Bateen has emerged as the most popular area for luxury villas for rent in Abu Dhabi. 

Abu Dhabi’s reputation as one of the safest cities in the world has also strengthened its appeal among investors, residents and expats. Moreover, the emirate’s organised response to the ongoing pandemic and widespread vaccine rollout has played an important role in the recovery of the real estate sector and the wider economy. 

Commenting on the trends, Haider Ali Khan the CEO of Bayut & dubizzle and the Head of EMPG MENA, said: “Abu Dhabi’s real estate market has really gone from strength to strength in the last few years, especially since freehold ownership was opened up in 2019. There is an excellent inventory of waterfront, fully-integrated communities with malls, parks, schools and other amenities in the vicinity, making the capital a good choice for those who want to purchase a family-friendly home that they can either live in or gain returns from. The appeal of Abu Dhabi as a safe destination has only grown in the last year, thanks to the emirate’s proactive measures to contain the pandemic and safeguard residents.”

Properties For Sale In Abu Dhabi

Villas:  

Yas Island has continued to hold the top spot with buyers keen on luxury villas.

  • The average price-per-square-foot for villas in Yas Island has increased by 4.2%, from AED 1,015 in Q4 2020 to AED 1,058 in Q1 2021. This could be attributed to recent handovers in the area and the increasing demand for waterfront villa properties. 
  • On the other hand, villas in Saadiyat Island have experienced a minor decline in average sales price-per-square-foot, decreasing from AED 1,368 to AED 1,359. 
  • Al Raha Gardens has also seen its price-per-square-foot for villas decrease slightly, averaging at AED 833 in Q1 2021.

According to the combined data released by Bayut & dubizzle, the reasonably-priced suburban district of Al Reef has garnered the most interest from buyers looking for affordable villas in the first quarter of 2021.

  • The average sales price-per-square-foot for villas for sale in Al Reef has witnessed an increase of 2.3% during Q1 2021, increasing from AED 640 to AED 661, pointing to the growing demand for affordable, family-friendly villa communities. 
  • Other suburban areas like Shakhbout City (Khalifa City B), Mohammed Bin Zayed City and Khalifa City A have also maintained their appeal with prospective buyers in search of competitively-priced villas in the capital city. 

Apartments:

When it comes to luxury apartment sales, prospective investors and buyers have shown a strong inclination towards waterfront and island communities, as per consumer preferences observed on Bayut & dubizzle.

  • Al Reem Island has remained the firm favourite to buy upscale apartments in Abu Dhabi. The apartments in Al Reem Island have experienced a moderate price decline of 5.3% with price-per-square-foot averaging at AED 995.
  • Saadiyat Island, Al Raha Beach and Yas Island have also continued to appeal to high-net-worth buyers and investors, experiencing an uptick in sales price-per-square-foot of up to 2%. 

Prospective investors and buyers have focussed their interests on suburban neighbourhoods for affordable apartments for sale in Abu Dhabi.

  • The price-per-square-foot for flats in Masdar City has decreased by 4.8%, from AED 1,221 in Q4 2020 to AED 1,162 in Q1 2021.
  • Al Reef has also maintained its popularity with prospective buyers in Q1 2021. The average price-per-square-foot for flats in Al Reef saw an uptick of 2.7%, averaging at AED 666 in Q1 2021.
  • Apartments in Al Ghadeer have also seen an uptick in sales price-per-square-foot, standing at AED 709 in the first quarter of 2021.

Rental Yields in Abu Dhabi

  • Al Reef has reported an average ROI of 8.2%, offering the highest projected rental yield for affordable apartments. When it comes to luxury apartments, Yas Island offers a strong return-on-investment of 6.8%.  
  • Shakhbout City (Khalifa City B) has offered an average ROI of 9.4% to investors keen on purchasing affordable ready villas, while Al Raha Gardens has also been yielding a healthy ROI of 5.76% for luxury homes in Abu Dhabi.

Off Plan Projects in Abu Dhabi

  • The combined data released by Bayut & dubizzle reveals that Diva in Yas Island has been the most sought-after project for competitively-priced off-plan apartments in Q1 2021, while Saadiyat Cultural District has been the preferred choice in the luxury segment. 
  • Investors keen on affordable off-plan villas in Abu Dhabi have shown the most interest in Noya in Yas Island, while Yas Acres has remained a firm favourite for luxury off-plan villas.

Properties For Rent

Villas:

Based on the collective price trends observed on Bayut & dubizzle, Mohammed Bin Zayed City (MBZ) has remained the most attractive option for affordable villa rentals in Abu Dhabi.

  • The asking rents in MBZ City have increased by up to 2% across the board for all units. Prospective tenants can expect to pay average annual rents of AED 95k for 3-bed, AED 130k for 4-bed and AED 146k for 5-bedroom villas in MBZ City in Q1 2021. 
  • Khalifa City A, Al Reef, Shakhbout City (Khalifa City B) and Al Muroor have also emerged as popular choices for potential tenants. These areas have experienced modest increases up to 7% in average annual rents in the first quarter.

For luxury villa rentals in Abu Dhabi, Al Bateen has garnered the most interest, experiencing moderate declines in rental costs of up to 9% overall.

  • The asking rents for 5-bed villas in Al Bateen have also become more affordable in Q1 2021, averaging at AED 178k. Meanwhile, the 6-bedroom houses in Al Bateen have remained relatively steady at AED 243k.
  • Other integrated communities like Yas Island, Al Raha Gardens and Saadiyat Island have also experienced steady demand for luxury villa properties in Q1 2021.

Apartments:

In Q1 2021, Khalifa City A has remained the top choice for tenants seeking affordable flats in Abu Dhabi.

  • The asking rents in Khalifa City A have seen marginal fluctuations across the board, averaging at AED 28k for studios, AED 42k for 1-bed apartments and AED 62k for 2-bedroom flats.
  • Tenants searching for affordable accommodation have turned to older, well-connected districts and affordable suburbs such as Al Khalidiya, Hamdan Street, Al Muroor and Mussafah. 
  • These neighbourhoods have largely observed minor fluctuations of up to 5% in rental costs in Q1. However, Al Khalidiya has experienced increases up to 7% in asking rents for studios and 2-bedroom apartments.

Al Reem Island has remained a favourite for upscale apartment rentals in Q1 2021, experiencing minor declines of up to 3% in asking rents.

  • The average rents for flats in Al Reem Island have decreased slightly throughout the first quarter, with 1-bed units averaging at AED 59k, 2-bed flats at AED 84k and 3-bed apartments for AED 124k.
  • Al Raha Beach, Corniche Area, Corniche Road and Al Bateen have also seen a steady interest from consumers for luxury apartment rentals. These luxury apartments have become more affordable for tenants in Q1, experiencing declines between 2% to 11% in rental costs.

Background Information

Bayut.com

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