Abu Dhabi property market: From Al Reef to Saadiyat Islands – 5 areas to track

The UAE’s real estate market has had a superb year in 2023. From Dubai cementing its place as one of the top property destinations in the world, to Abu Dhabi being preferred by High Net Worth Individuals (HNWI), the emirates have performed well across the board.

In its recent report tracking the real estate sector across 2023, property portal Bayut released trends based on the search and transaction patterns observed on the platform.

The report highlights the performance of Abu Dhabi as a residential and investment destination with property prices in the capital on an upward trajectory. It notes that investing in the emirate could be advantageous for those looking to sell or rent out their properties in the capital. As per DARI, Abu Dhabi’s digital real estate ecosystem, there were over 14,000 residential property (ready and off-plan) sales transactions valued at over Dhs52bn in 2023.

While there was an increase in sales prices in several areas driven by high demand, this trend was particularly noticeable in upscale neighbourhoods offering high-end amenities and facilities.

Commenting on the findings, Haider Ali Khan, CEO of Bayut and head of Dubizzle MENA said, “What we witnessed in 2023 was a record-breaking year for the overall UAE real estate market and Abu Dhabi has also been a major contributor to that success. Local and international HNWIs continue their interest in UAE real estate as a prime market for investment, especially with landmark projects like Jubail Islands and Rahman Islands taking shape.”

“While the factors for the growth in the property sales market in Abu Dhabi certainly include investors taking advantage of favourable market conditions, the steady increase across the capital’s rental sector have also inspired more property-seekers to become homeowners, as opposed to paying large sums in rent.”

Trends for property ownership in Abu Dhabi:

1. Al Reef: For affordable apartments, Al Reef and Al Ghadeer were the most searched areas, reported Bayut. In terms of projected ROI for apartments, Al Reef stood out with an impressive 8.04 per cent rental yield in the affordable housing category.

2. Al Samha: When it comes to affordable villas, there has been a minor increase of up to 3.95 per cent recorded in price-per-square-foot. Most notable appreciations were seen for Al Samha, followed by Khalifa City and Al Ghadeer.

3. Hydra Village: Additionally, in the affordable category, Hydra Village offered a 6.78 per cent ROI for houses, whereas Al Raha Gardens offered the highest ROI of 6.04 per cent for buy-to-let villas in the luxury villas segment.

4. Saadiyat Island: Data from Bayut showed that sales prices for luxury apartments and villas in Abu Dhabi’s sought-after neighbourhoods have risen by up to 13 per cent in 2023. Saadiyat Island was a particular highlight, revealing price increases of 8.73 per cent for luxury apartments and a massive 12.9 per cent hike for premium villas.

5. Al Reem Island: Luxury apartment seekers have also generated high search volumes for units in Al Reem Island, Yas Island and Saadiyat Island in 2023. Al Reem Island continued to offer a healthy 6.65 per cent ROI for investors interested in luxury flats for sale in Abu Dhabi.

Trends for renting properties in Abu Dhabi

As reported by Bayut, advertised rental prices for apartments in the most searched-for luxury areas experienced moderate to major increases by up to 14 per cent, mainly in island communities. The report noted that affordable apartment rentals have continued to stay competitive, with a price drop of almost 3 per cent in some areas.

 

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Rental prices for affordable villas have experienced minor to moderate upticks of up to 4.91 per cent. Those looking for spacious villas on a budget have mainly picked Mohammed Bin Zayed City and Khalifa City. Additionally, affordable accommodation seekers also focused their efforts in finding apartments in Khalifa City and Al Khalidiya areas.

High-end villas, on the other hand, witnessed major appreciations in rental costs. As per Bayut’s report, Yas Island and Saadiyat Island have revealed 12.7 per cent and 22.2 per cent hikes in rental prices for luxury houses, potentially driven by a solid demand.

In the luxury segment, tenants in Abu Dhabi preferred Al Reem Island and Al Raha Beach for apartments, while Al Raha Gardens and Yas Island were favourites for premium villas.

Khan added, “It’s quite clear that demand is high for properties in the capital. Over the course of 2023 we received over 14 million visits to Bayut for properties advertised in Abu Dhabi. This number continues to grow year-on-year and we expect that trend to stay steady, especially taking into account the growing international interest in the Abu Dhabi market.’’

The report notes that the capital’s increasingly robust market is potentially driven by factors such as increased demand, attractive investment opportunities, and a conducive economic environment.

Also read: Dubai real estate powers through January 2024 with Dhs35bn in sales