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  • May 06, 2020

Abu Dhabi’s Freehold Property Market Grows Steadily, Q1 Report


As per analysis conducted by real estate experts, Abu Dhabi’s freehold property market has shown a steady trend in the 1st quarter of 2020. These analyses also show that prominent freehold investment zones such as Al Reef and Al Reem Island have remained the top preferences for investors and property buyers in the first three months of this year. As compared to the last quarter of the previous year, the prices of these freehold zones have also remained on the stable side.

Prominent Freehold Zones

Shedding light on the most prominent freehold zones in the capital city, Al Reem Island easily ranks among the most preferred ones in Q1, 2020. It was also a top choice for investors and prospective buyers in the year 2019. As per the Department of Municipalities and Transport’s report, the highest transaction value in the real estate sector in 2019 was recorded in Al Reem Island. It amounted to Dhs 6.52B. However, it has witnessed a slight decrease in the average price per square foot. From Dhs1,011 in Q4 2019, it has slipped to Dhs 911 in the first quarter of 2020. Having said this, the minor decrease of 2 percent signifies steadiness keeping into consideration the current conditions.

Other than Al-Reem Island, Al Raha Beach, Yas Island, and Saadiyat Island are some of the popular waterfront communities among investors and property buyers. However, these communities have also witnessed minor fluctuations in the first quarter with Al Raha Beach’s average per square foot price dropping to Dhs 1,225 from Dhs 1,271 after having a 3.6% decline in Q1 2020.

Apartments and Villas Analysis

Other communities that remained unaffected in this quarter are Al Ghadeer and Al Reef. Their steady demand is credited to their affordable rates. Those who are looking for a property in Abu Dhabi at economical rates, their first preference is to check listing in these two communities. Al Ghadeer has been a top runner community for people who want to buy apartment for investment purposes. An increase of up to 8.6% in the average rental returns clearly back this statement. Similarly, Al Reef has remained a firm favorite community for luxury villas. Investors get a 7% ROI on an average on villas in this suburb. The price per square foot also stays steady at Dhs614.

Apart from Al-Reef, Saadiyat Island, Yas Island, and Raha Gardens are prominent areas for villas sales. Their average price per square foot is Dhs1,430, Dhs846, and Dhs773 respectively. While the price of Saadiyat Island remained consistent, the other two areas witnessed a minor surge in the average price in comparison to the last quarter of the previous year.

Insights on Off Plan Market in Abu Dhabi

People looking to invest money in the off-plan market favored Al Reem Island, Saadiyat Island, and Yas Island over others. Speaking of the latter, Yas Acres emerged out as a favorite pick of the investors. In Al Reem Island, Shams Abu Dhabi was noted as their preferred choice.

Rental Market Details

Al Reem Island, Al Khalidiya, Khalifa City A, Al Hamdan, and Mussafah – these are some of the popular communities for rental apartments with Al Reem Island retaining the top position. This particular community’s rental costs remained stable in the first quarter. The average rental rates for studio apartments were Dhs48l while 1-bedroom and 2-bedroom flats were available at Dhs64k and Dhs91k respectively. The other areas mentioned above also witness a slight surge in the rental costs for apartments.

Certain communities such as Al Nahyan, Al Muroor, and Tourist Club Area experienced an insignificant decrease in the rental costs. The decrease noted remained below 5.5%.

For rental villas in Abu Dhabi, Mohammed Bin Zayed City enjoyed the top spot in Q1, 2020. The average rental cost here for 3-bedroom villas was noted to be Dhs88k. On the other hand, 4-bedroom and 5-bedroom villas’ average rental cost was Dhs123k and Dhs143k respectively. Khalifa City A, Shakhbout City, and Al Reef are other communities that remained favorite in terms of renting villas in this quarter.

These stats clearly show the real estate sector showed a healthy performance in the first quarter. While the Q2 of 2020 has been hit by the global pandemic, experts believe that the stats won’t be poor due to the timely measures taken by the government and economic stimulus packages they have introduced. With the lockdown now being lifted gradually, it is speculated that the real estate industry will be back to its full swing in the time to come.

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