Abu Dhabi's real estate market experienced notable growth in the third quarter, with home prices accelerating faster than the previous quarter, according to data released on Monday.
The ValuStrat Price Index (VPI) rose 1.7 per cent quarterly and 5.3 per cent annually to reach 120.7 points, up from the 100 base points recorded at the start of 2021. Villa prices saw a 2.2 per cent increase quarter on quarter and an 8.2 per cent rise annually, achieving 128.3 points. Meanwhile, apartment prices grew by 1 per cent quarter on quarter and 2.2 per cent year on year, reaching 113.4 points.
The weighted average home value this quarter was Dh9,924 per square metre (Dh922 per square foot), with apartments averaging Dh10,667 per square metre (Dh991 per square foot) and villas at Dh8,127 per square metre (Dh755 per square foot). Saadiyat Island led in annual capital gains with villa prices surging 19.9 per cent. Al Raha and Mohammed Bin Zayed City saw villa price growth of 7.5 per cent and 3.5 per cent year on year, respectively. House prices in Hydra Village and Al Reef remained unchanged compared to last year.
Apartments in Al Reef, Saadiyat Island, and Al Muneera recorded the highest annual capital gains at 4.9 per cent, 4.5 per cent, and 3.6 per cent, respectively. The VPI for rental values in Abu Dhabi showed a steady increase of 5.8 per cent annually and 2.6 per cent quarterly, reaching 115 points from 100 points in Q1 2021.
Villa rents rose 5.7 per cent annually and 2.7 per cent quarterly to 121.6 points, while apartment rents increased 6.0 per cent year on year and 2.4 per cent quarter on quarter to 109.2 points. Gross yields averaged 7.5 per cent, with apartments at 7.9 per cent and villas at 6.5 per cent. The average occupancy rate stood at 85.7 per cent.
During the first three quarters of 2024, Abu Dhabi completed 1,442 apartments and 593 villas, representing 22.8 per cent of the expected residential pipeline for the year. Scheduled project completions for 2024 total 8,907 residential units. The average price for off-plan properties increased 32.5 per cent quarterly and 33 per cent annually to Dh18,384 per square metre (Dh1,708 per square foot).
The average ticket size of off-plan homes decreased 4.6 per cent annually to Dh3.4 million. Off-plan transaction volume, which accounted for 41.2 per cent of overall sales, declined 36.7 per cent quarter on quarter and 58.6 per cent year on year due to fewer project launches. Average prices for ready homes stood at Dh11,507 per square metre (Dh1,069 per square foot), up 6.4 per cent yearly but down 3.6 per cent quarterly.
The average ticket size of ready homes reached Dh2.2 million, down 3.3 per cent quarter on quarter but stable annually. Transaction volume for ready properties grew 18.9 per cent quarter on quarter and 51.1 per cent year on year. In the third quarter of 2024, Abu Dhabi saw 2,594 mortgage transactions across all asset classes compared to 1,495 cash transactions of ready properties.
The total sales value attributed to mortgage transactions was Dh13.5 billion, with cash transactions totaling Dh4.2 billion. "Consistent growth across residential, office, industrial, and hospitality sectors underscores Abu Dhabi’s mature and stable market conditions, solidifying its competitive position within the UAE’s real estate landscape," said Haider Tuaima, director & head of real estate research at ValuStrat.
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