Rent and sale rates are still facing declining pressures in Q3 of 2018...
24 October 2018| Last updated on 24 October 2018
As a result of the economic conditions, Abu Dhabi is still feeling continued pressure
For those who are looking to rent or buy in the UAE’s capital, the real estate in Abu Dhabi has never looked better - Abu Dhabi’s rental and sale prices continue to decrease as the year comes to an end.
Abu Dhabi’s real estate market is still undergoing this pressure because of the country’s macroeconomic conditions and abundance in supply of housing estates in the market.
That’s not all, new developments in the market aren’t the only reason:
- 1. Ongoing redundancies
- 2. Companies offering lower rental allowances
- 3. Hampering rental rates around the capital
And as a result of this, the average rental rates in Abu Dhabi are down by 3% for apartments and 2% for villas in comparison to Q2 this year.
Areas such as Saadiyat, Al Reem Island and Al Raba Beach are all returning lower percentages than the previous quarter – even though they are classified as more “resilient apartment locations.”
However, this is not all bad news….with rental and buying prices decreasing, tenants are taking advantages of this by upgrading to larger apartments, better-quality specifications or better locations around the capital.
Compared to last year
In comparison to the same time last year, areas such as Al Raha Beach, which saw the highest price point in 2017 are now seeing a 30% decrease in rental asking price for studios.
As well as a decrease is seen for villas on Al Reem Island – which is undergoing a 6% decrease.
Four-bedroom villas in Al Reem Island are now renting for AED235,000 per year, which is a recorded decline from Q3 last year.
The Al Ghadeer area also saw a 5-6% decline, Khalifa City a 2% decline and Al Saadiyat Island a 1% decline in the villa sales market.
A response to this
The government of Abu Dhabi is attempting to provide some aid to the real estate market by announcing 50 new initiatives, which are a part of its AED50 billion stimulus package for housing in the city.
And real estate companies are expecting the Abu Dhabi market to continue facing price adjustments will into 2019.