There are signs of increasing activity in the stalled Abu Dhabi property market, says the property consultancy Landmark Advisory
New properties coming on to the market should help to give buyers more choice. The developers will also be pleased to hear that property consultant Landmark Advisory thinks there is also a good deal of opportunity for investment buys.
Jesse Downs, director of research for the consultancy, says: “There has been a noticeable increase in terms of sales as more developments are nearing completion.
“We have witnessed more end-users emerging as buyers as they become more confident in investing in the market again and we expect this interest to increase as more units become available.”
Registered sales and an increasing number of enquiries have been reported from areas such as the Arabian District in Al Reef Villas and towers in Al Reem Island, including Marina Square and Sun and Sky Tower. These projects are due for completion at the beginning of 2010. Listing prices for these areas saw only marginal declines, “an indication of emerging price floors on these developments” as Landmark puts it.
Landmark Advisory notes that the first phases of some key developments are set to be completed within the next 6-9 months. “This will create additional stock in an under-supplied market which will provide relief and additional options to Abu Dhabi residents,” explained Jesse Downs.
“The delivery of these units will be the first of the recent freehold era in Abu Dhabi and we predict that the handover will boost the market and renew interest from end-users and investors.”
While the buyer profile in Abu Dhabi clearly indicates that the action is currently coming from end users, Landmark thinks there are still opportunities for profitable investment.
Al Reef villas currently present excellent potential market yields, but Landmark Advisory believes that in the long term the better bets are likely be Marina Square and the Sun and Sky Towers.“ This is due to their proximity to Abu Dhabi city centre and an undersupply situation in the apartment segment for at least the next three years.”
As indicated by Landmark Advisory’s price map, Abu Dhabi Residential market prices are still showing signs of readjustment. While average prices for apartments have declined 5-10 percent since the end of the first quarter, Landmark’s figures suggest that villa prices have remained stable in the period.
That follows a substantial drop in prices for villas during 2009 – up to 45 percent in total since the third quarter of 2008. By comparison, apartment prices are down by 30 percent since Q3 2008

 

 

 

 

 

 

 

 

[Caption] Jesse Downs of Landmark Advisory, Sorouh’s Sky Tower on Reem Island is due for completion next year

 

[Originally published in Abu Dhabi Week vol 2 issue 21]