Abu Dhabi real estate market is on the up, introducing new opportunities for the investors. New homes, communities and entire islands being developed for residential purpose are emerging on an ongoing basis as yet. Adding to that, now foreigners are allowed to own units and land plots in the Emirates capital. In April, 2019 Department of Urban Planning and Municipalities announced 17 freehold areas, where an individual or a legal entity of any nationality acquires ownership when buying properties. Previously, that has referred to a long-time leasehold only.
Abu Dhabi Real Estate Market
Hotel apartments in skyscrapers, marketable studios in the center, luxury seaside villas and family townhouses in secluded communities – Abu Dhabi offers a wealth of homes for those who are seeking for one either for living or investing. Looking through hundreds of listings on internet real estate portals a foreigner, unfamiliar with the city, may be enchanted by the property itself and neglect its neighborhoods. But the proper district, that perfectly meets the property purpose and demands of the owner wins half a battle. We offer brief outlines of TOP investment areas to guide you through Abu Dhabi and identify an economic potential of these localities.
Best Areas For Foreign Investments
Al Reem Island – a unanimous winner in all the statistics, picked by different real estate portals. It is the most searched area for buy and rent in 2019 and Q1 2020. Adding to that, it leads in number of consummated apartments sales in 2019 (as of Bayut's Annual Market Report 2019).
A fast-developing district, located close to Abu Dhabi mainland, to Al Maryah Island and Saadiyat Island. It's the district of high-rise towers with notable Gate Towers, inspired by Stonehenge, and most of its residences: villas, apartments and penthouses view Arabian Gulf. Schools, offices, supermarkets, Reem central park and Reem mall + convenient connectivity make up very comfortable environment for family living.
The prices for studios start at USD 102.000 (AED 375.000, RUB 7.317.257), in the outskirts it is possible to buy affordable homes.
ROI coefficient in Al Reem Island taken as an average for apartments amounts to 7%, ROI for studios reaches 8,7%.
Al Raha Beach – the second most popular area chosen by singles and families, as well as investors, lies along the seashore between Abu Dhabi and Dubai. Being managed by Aldar a self-contained development includes several communities, the most remarkable of them: Al Muneera, Al Zeina and Al Bandar. An array of homes ranging from small studio-apartments to huge penthouses, townhouses and exclusive podium villas caters to middle budget as well.
Here you may rent waterfront apartments on attractive terms: USD 15.791; AED 58.000; RUB 1.131.904 annum – this is a medium amount relating premium properties across Abu Dhabi. Minimal price for 1-bedroom apartment estimates to USD 217.809; AED 800.000; RUB 15.612.474. Apartments generate ROI 7% on average.
Al Reef is set on the capital mainland, aside from city center and consists of 2 parts: Al Reef Downtown, which is the heart of the development and more than 2000 villas set around – Al Reef Villas. This residential project of Manazel Real Estate was purposefully oriented on middle-income buyers, that has made it very popular among expats and insured a positive investors' feedback.
Mansions in AL Reef Downtown feature studios, 1-2-bedroom apartments and a limited number of units with 3 and 4 bedrooms. They are normally occupied by singles and small families. Al Reef villas are firm favorite for rent among families with children, or those who fancy space and privacy. Rental prices for 2-bedroom villas start at USD 19.058; AED 70.000; RUB 1.366.091. Annual rent for a studio will cost USD 10.074; AED 37.000; RUB 722.077 minimum. One-bedroom apartment is sold on average at USD 173.430; AED 637.000; RUB 12.431.432. Affordable properties generate sizable return on investment: villas the highest ROI 7,1%, one-bedroom apartments produce 9,3 %.
Saadiyat Island – a cultural city hotspot, which innovative public centers: Manarat, Louvre Abu Dhabi and museums are dedicated to education, history and art. A very promising area, because some flagship social projects, like The Guggenheim Abu Dhabi, are still under development and once completed will bring more tourists. So far, it is a favorite locality for investing in off-plan homes, specifically waterfront villas.
Prestigious surroundings like a number of 5-star hotels offering upscale amenities and fine dining, Saadiyat Island Golf Club, an excellent beach turn the island into a coveted place to enjoy holidays and a reasonable placement of funds. For now, studios under construction may go for moderate USD AED 670.000; RUB 13.075.447, but who knows the price tomorrow? Minimal prices registered for villas begin with USD 1.358.555; AED 4.990.000; RUB 97.382.807. Studio rental yield approaches 8,7%, apartments gain 7,8% ROI, villas about 5%.
Yas Island – already strong luxury brand, the main recreational hub of the city. Its mega entertainment parks, Yas Marina Circuit, hosting Formula 1 Grand Prix, Yas Links Golf Club, open-air theatre Du Arena make up a stream of events, attracting crowds of visitors. 5-star hotels, gorges restaurants, glitzing surroundings of the island are perfect for those, who love luxury lifestyle in the heart of the events. The most popular communities to invest in off-plan properties West Yas and Yas Acres. As for ready homes, especially for rent, Ansam community arouses major interest.
Economic potential of Yas Island allows to earn yet today. An average ROI in 2019 reached 9,2%, now the highest return is about 8,1% for a studio. Rental yearly payment for a 1-bedroom apartment comes out at USD 21.780; AED 80.000; RUB 1.561.015. Asking price for an apartment starts at USD 140.214; AED 515.000; RUB 10.050.530.
Masdar City – one of the most sustainable residential communities in the world, a low-carbon development, where the newest energy and water efficiency solutions are successfully applied. The eco project was initiated by the Government of Abu Dhabi in 2006, as yet buyers' interest to Masdar apartment has brought it the fifth place in the chart of most searched areas, according to the Bayut'r report 2019. Solid proportion of the properties is taken by commercial premises. International Renewable Energy Agency is headquartered in Masdar. Investors, side with advanced technologies, eco-friendly and cost-effective lifestyle might highly rate Masdar City homes. Now they may select from studios, 1-, 2-bedroom apartments and villas containing up to 5 bedrooms. A studio is sold for USD 135.856; AED 499.000; RUB 9.726.845. An average return on investments gained by apartments varies about 8,7% - the highest level for freehold zones, registered by Bayut.
Al Ghadeer – a rapidly growing development in Abu Dhabi outskirts, that offers apartments in low-rise buildings, townhouses and villas. Remarkably, that an average ROI in Al Ghadeer estimates to 8%. It is the third largest value, after Masdar City and Al Reef, referring to top in demand areas. Still under active construction, its 2 clusters: Al Waha and Al Khaleej Village are already completed. Al Ghadeer includes a peculiar for the desert, equal as for the city, a farming project. Mini plots are supposed to be given to renters for growing plants and there will be Markets, where organic fresh vegetables, greenery and locally produced food may be bought. Residential units are reasonably priced and affordable to many. A studio is offered for sale for USD 103.730; AED 381.000; RUB 7.426.709. Rent for 1-bedroom apartment averaged at USD 11.707; AED 43.000; RUB 838.022. Rental return reaches 8,6%, for 2-bed villa – 6,7%.
When planning to acquire real estate property in Abu Dhabi a smart investor should clearly identify the purpose, what he would like to get after all and choose an appropriate location. Note, that the price hinges on the area, where the property stands. Take the trouble to pick all available information up and consult your real estate agent before making a final decision. It is strongly recommended to check your financials considering future expenditures, especially in terms of taking a mortgage loan or buying off-plan properties.
- Abu Dhabi real estate market offers great opportunities to passive earning for foreigners.
- Onwards of 2019 non-UAE and -GCC nationals are granted the right for freehold ownership in the capital.
- Al Reem Island is the most popular freehold area for buy and rent apartments in Abu Dhabi City.
- Al Reef villas generate excellent ROI 7,1%.
- Yas Island and Saadiyat Island – touristic areas with strong investments potential.
- Buying real estate at innovative and eco-friendly Masdar City you invest in an environmental improvement.