Sunday 12 July 2020

Abu Dhabi’s freehold market steady prior to Covid, says report

ABU DHABI, May 3, 2020

The property prices in Abu Dhabi's freehold investment zones such as Al Reem Island and Al Reef remained steady during the first three months compared to Q4 2019 and continued to attract the attention of prospective buyers and investors in the capital. 
But the ongoing Covid-19 restrictions are creating unprecedented challenges for the brokerage community, said a report by UAE portal Bayut. 
Though a bit challenging, the current situation has not been able to create much imapct on the consumer interest as far as the capital’s property market is concerned, owing to the timely measures and economic stimulus packages introduced by the government.
Similar to government entities and industry leaders across the world, stakeholders in the Abu Dhabi real estate market have also come together to mitigate the impact of the pandemic on the industry, it stated.
Among the emirate's freehold properties, Al Reem Island recorded the highest value of real estate transactions last year registering deals worth Dh6.52 billion, as per a report by Abu Dhabi’s Department of Municipalities and Transport (DMT).
Similar to the 2019 trends, Al Reem Island remains the most popular choice with buyers and investors interested in apartments for sale in Abu Dhabi in the first quarter of 2020. 
The average price per sq ft in Al Reem Island has seen a minor decrease of 2%, going from Dh1,011 in Q4 2019 to Dh911 in Q1 2020. 
Other waterfront communities such as Al Raha Beach, Saadiyat Island and Yas Island have continued to garner interest from buyers for ready apartments as per Bayut’s Q1 report for Abu Dhabi. 
The price per sq ft for Al Raha Beach has also declined on average by 3.6% from Dh1,271 to Dh1,225 in Q1 2020. On the other hand, Saadiyat Island and Yas Island have seen prices remain stable at Dh1,465 and Dh1,336 respectively. 
Affordable suburbs such as Al Reef and Al Ghadeer have also drawn interest from buyers and investors keen on affordable apartments in Abu Dhabi. 
When it comes to villas for sale in Abu Dhabi, Al Reef has remained the most popular choice with the average price per square foot staying consistent at Dh614. 
Other notable areas for villa sales in Abu Dhabi include Saadiyat Island, another neighbourhood where the price per square foot has stayed stable at Dh1,430. Yas Island and Al Raha Gardens have experienced a slight increase in price per square in the first quarter of 2020, averaging at Dh846 and Dh773 respectively. 
For investors looking to purchase apartments with high return-on-investment in Abu Dhabi, Al Ghadeer has remained the firm favourite with average rental returns up to 8.6%. For villas in Abu Dhabi, Al Reef has remained the best option, with an average ROI of 7%.
When it comes to the off-plan market in Abu Dhabi, freehold island communities such as Yas Island, Al Reem Island and Saadiyat Island have remained the favoured options. 
Yas Acres in Yas Island has been the most popular choice among prospective buyers interested in off-plan villas in Abu Dhabi while Shams Abu Dhabi in Al Reem Island has been most sought after for off-plan apartments in Q1 2020. 
Al Reem Island has also retained the top spot with potential tenants interested in Abu Dhabi’s apartments, according to Bayut’s Q1 report. 
The rental costs in Al Reem Island have remained stable in Q1 2020, averaging at Dh48,000 for studio apartments, Dh64,000 for one-bedroom flats and Dh91,000 for 2-bedroom units. 
Mohammed Bin Zayed City (MBZ City) has remained the most popular location for rental villas in Abu Dubai in Q1 2020, with average rents holding steady at Dh88k for 3-bedroom villas, Dh123k for 4-bedroom houses and Dh143k for 5-bed units.  
Relatively stable suburban areas such as Khalifa City A, Al Reef and Shakhbout City (Khalifa City B) have been the other firm favourites with renters interested in villas in Abu Dhabi. 
CEO Haider Ali Khan said: "In the first three months, before our community was impacted by the unfortunate global incident, the Abu Dhabi real estate market was showing healthy signs of stability which is clearly visible from our Q1 report."
"The effects of the current situation on consumer interest in the capital’s property market have not been too drastic thanks to the timely measures and economic stimulus packages introduced by the government, and now that the restrictions are easing up further, we’re hopeful things will start going back to normal fairly soon," he added.-TradeArabia News Service 


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