Luxury apartment and villa prices in Abu Dhabi have risen this year, driven by a noticeable increase in demand, particularly for new projects in areas such as Saadiyat, Reem, Yas, and Al Raha.
Real estate officials and experts told Al Ittihad that Abu Dhabi has become an attractive destination for luxury real estate investment, drawing a significant number of international investors. The emirate offers a high standard of living, appealing tax incentives, as well as political and economic stability, in addition to a secure environment.
Knight Frank recently confirmed that Abu Dhabi is among the most popular real estate investment destinations for global high-net-worth individuals. The emirate has transformed into a global tourist and investment hub. According to a recent survey by the company, Abu Dhabi emerged as the second most popular real estate investment destination for the world’s wealthy, following Dubai, with 21% of respondents indicating that they prefer the UAE capital for purchasing property. Abu Dhabi’s appeal stems from a unique mix of cultural landmarks and world-class infrastructure, including Yas Island, Abu Dhabi Global Market, and Saadiyat Island. The emirate’s reputation is further enhanced by world-renowned museums like the Louvre and the upcoming Guggenheim and Zayed museums.
According to Asteco Real Estate Services, the average villa sales prices in Abu Dhabi recorded an approximate 2% increase in the second quarter of this year compared to the first quarter, with established and luxury villa communities continuing to outperform, achieving price growth of nearly 6% in some cases.
Price Increases
Market indicators on Abu Dhabi’s DARI digital real estate platform, affiliated with the Department of Municipalities and Transport, showed that one-bedroom apartment prices on Reem Island increased from AED 750,000 in the first quarter of this year to AED 960,000 in the second quarter, while two-bedroom apartments rose from AED 1.5 million to AED 1.57 million, and three-bedroom apartments climbed from AED 1.75 million to AED 2.15 million. In contrast, studio prices dropped from AED 725,000 to AED 610,000, and four-bedroom apartments decreased from AED 2.44 million to AED 2.1 million.
On Saadiyat Island, the average selling price of four-bedroom villas increased from AED 6.4 million to AED 6.6 million, while the price for five-bedroom villas slightly decreased from AED 7.7 million to AED 7.6 million.
On Yas Island, two-bedroom apartment prices rose from AED 1.35 million to AED 1.44 million, while other unit prices remained stable or saw slight declines.
High Demand
Earlier this month, Aldar Properties announced that it had sold three buildings within the first phase of its “Gardenia Bay” project on Yas Island within just 24 hours of their release. Rashed Al Omaira, Chief Commercial Officer at Aldar Development, noted that the strong demand for the recently launched first phase encouraged the company to release an additional three buildings for sale. He highlighted the robust demand for high-quality projects offering luxury properties that appeal to both foreign and domestic investors.
Non-resident buyers accounted for 23% of total sales in “Gardenia Bay,” reflecting Abu Dhabi’s attractiveness as a preferred destination for international clients, while residents within the UAE represented 40% of total sales, and UAE nationals accounted for the remaining 37%.
Luxury Units
Recently, Q Properties announced that the third phase of its luxury apartments at Reem Hills, comprising spacious one-bedroom, two-bedroom, and three-bedroom apartments, had sold out within just four hours. David Harman, Head of Development at Q Properties, stated that the company received strong demand for the apartments in the third phase of the Reem Hills project, which offers luxury residential units that meet the needs of a diverse clientele due to its prime location on Reem Island, competitive pricing, and attractive design features.
He also mentioned that Q Properties recently launched the final phase of its luxury apartments at Reem Hills, following the success of the previous phases, and expects this phase to continue attracting clients seeking high-quality apartments in a prime location.
The “Reem Hills” project will offer approximately 2,238 residential units at a cost of AED 8 billion.
Luxury Apartments and Villas
Reem Island topped the list of areas most searched by users for luxury apartments, according to Dubizzle’s Abu Dhabi Real Estate Market Report for the first half of 2023. The average price per square foot increased by approximately 0.19% to AED 1,034 during the first half of 2023 compared to the second half of 2022, while the return on investment stood at 6.58%.
Yas Island led the list of areas most searched by users for luxury villas, with an average price of AED 3.9 million and a return on investment of 4.62%, according to the report.
