Abu Dhabi maintains stable residential prices in Q2

Abu Dhabi Property MarketImage Credit: Supplied

A slowdown in transaction volume and more sustainable levels of rental and capital appreciation defined the performance of Abu Dhabi's residential sector during the second quarter, according to Asteco's Abu Dhabi Report Q2 2014.

On average apartment sales prices increased 4 per cent quarter-on-quarter, and 29 per cent since the second quarter last year. Villa sales prices remained relatively stable, showing an average increase of just 2 per cent.

Average apartment rental rates ran in parallel with villas, recording modest growth rates of up to 8 per cent.

"Ongoing tenant preference for newer, master-planned communities drove demand for apartments in prime developments within investment areas, while affordable villa locations continue to be popular," said Jerry Oates, General Manager of Asteco Abu Dhabi. "Market sustainability will be further buoyed by Abu Dhabi's plans to launch its own rental index this year."

Growth for low- and midrange apartment developments such as Reef Downtown dropped to 2 per cent in the second quarter, implying that prices reached a peak in the previous quarter. Prices, however, ranged from Dh900 to Dh1,150 showing an impressive 55 per cent year-on-year figure.

The stabilisation in villa sales prices nevertheless saw sales prices for a three-bedroom home in Hydra Village grow by 4 per cent to Dh1.3 million, while the standard Saadiyat Beach Villas rose by 2 per cent to hit Dh5.8 million for a three-bedroom unit.

Rental rates for prime two-bedroom apartments on Abu Dhabi island rose by 5 per cent to reach up to Dh200,000 per annum, while similarly sized properties in the investment areas of AI Raha Beach and Saadiyat Island also hit the same levels, up just 1 per cent quarter-on-quarter.

Abu Dhabi's office leasing figures recorded moderate quarter-on-quarter rental growth of 3 per cent for Grade A fitted commercial space, whereas Grade B commercial rates remained stable for both fitted and shell and core.

Source: Property Weekly


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