House prices and rents in Middle Eastern countries are dropping as Abu Dhabi properties are now much more affordable than they used to be.
Apartments and villas in most districts are witnessing declines from a drop in the demand from property buyers.
A shortening in demand has seen residential sale prices plummet in Abu Dhabi and rents have also gone down in the majority of places across the country.
The UAE-based real estate portal – United Arab Emirates portal – has commented n a recent report that the decline in demand has enabled people to buy Abu Dhabi properties and rent a lot cheaper in comparison to before. The properties have become more affordable following prolonged government austerity measures.
A UAE Real Estate Trends report from this year highlighted that sales prices for Abu Dhabi villas went down in six of eight places in the six months to March 31st. The district that saw the highest drop was in Al Raha Gardens where it plummeted by 11.8% and Saadiyat Island stayed the most expensive place despite a 5.2% decline.
The cost of rent in villas across Abu Dhabi also saw a similar course where the prices went down in six of seven districts. In Al Reef’s for example, the place witnessed a 10.9% weakening to Al Salam Street’s 3% plunge.
Rents may continue to decline across Abu Dhabi but this is only good news for tourists who are looking to short-term rent or long-term rent in the country. Perhaps it may attract more visitors to the country and even citizens of the country can enjoy lower prices and more of an affordable cost of living.
There has been a reduction in government spending in direct correlation to a fall in oil prices and this evidently affected employment opportunities and the demand for housing in the capital. But again, those who are looking to rent in the country are not complaining, whereas investors in properties who have been contemplating selling their properties or optimising rents may feel the real estate struggle in this Middle Eastern country.
Abu Dhabi is home to the federal government and to the country’s oil industry, which has complete control and domination across the entire emirate’s economy, which has had an effect on Abu Dhabi properties.
In relation to apartments, Saadiyat Islands saw a 6.1% drop in sales prices. All districts, however, witnessed price falls apart from Al Ghadeer, which actually saw an increase of 1% and Yas Island saw an increase of 0.6%.
The leisure and tourism industry in Abu Dhabi remains highly popular and sought after by people from all over the world. It is a very attractive country that has plenty to offer, so many things to see and do, and the rental market remains a significant part of this attraction – rental values have increased by 3.9%.
The poignant real estate market showed that the residential property sector in the Northern Emirates of Sharjah, Ajman and Ras Al Khaimah, has proven to be more robust and vigorous.
In relation to sales, apartment prices went up on average by 1.2% while villa sales prices went down by approximately 1.3%.
Abu Dhabi properties are seeing fluctuations in many areas but in all, their housing market remains relatively affordable for the majority. This is having positive influences on buyers in the housing market and for those looking to reap the benefits of the rental market. With this optimum forecast set to continue for the rest of the year, visitors to the country and citizens can continue to enjoy this current advantage.
Written by Gemma Smith