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Al Etihad
14-05-2025
- Business
- Al Etihad
Abu Dhabi real estate market builds growth across the board
15 May 2025 00:21 MAYS IBRAHIM (ABU DHABI)Abu Dhabi's real estate market recorded steady and broad-based growth in the first quarter of 2025, with gains across residential, office, retail and hospitality segments, according to ValuStrat's latest market ValuStrat Price Index (VPI) for the residential sector rose 2.1% quarter-on-quarter (QoQ) and 7.2% year-on-year (YoY) to reach 125.6 points, based on a baseline of 100 in Q1 outperformed apartments, appreciating 2.7% QoQ and 9.7% YoY to 134.7 points. Apartment prices rose 1.5% QoQ and 4.5% YoY to 116.9 average home value in Abu Dhabi reached Dh10,226 per square metre, with apartments averaging Dh10,979 per m2 and villas Dh8,407 per villa submarkets, Saadiyat Island led annual capital gains for villas, up 21.2%, followed by Al Raha 8.2% and Mohammed Bin Zayed City 4.7%.Rental values mirrored sales performance, with the residential rental VPI rising 2.2% QoQ and 9% YoY to 121 rents grew 3.4% QoQ and 11.6% YoY, while villa rents remained flat quarterly but were up 6.3% annually. The average gross rental yield stood at 7.8%, with apartments yielding 8.3% and villas 6.7%.The average annual apartment asking rents in Abu Dhabi City hit Dh114,000. Studio apartments averaged Dh63,000; one-beds Dh89,000; two-beds Dh125,000; and three-beds Dh180, Reef (3.4%), Al Bandar (2.8%), and Al Muneera (2.5%) saw the highest quarterly rental increases. Market Activity and SupplyThe first quarter saw the handover of 90 apartments and 189 villas, representing 2% of the expected 2025 residential pipeline of 13,941 units. Major projects progressed across Saadiyat Island, Zayed City, Ghantoot and Masdar City, reflecting developer off-plan sales slowed due to fewer new launches, average prices and transaction values rose, according to the property transaction volumes dipped 33.6% QoQ but climbed 13.6% YoY. The average price for ready homes reached Dh12,335 per m2, up 5.8% YoY, while the average transaction size surged 28.9% QoQ to Dh 2.6 transactions dominated activity, accounting for 2,846 deals totalling Dh9 billion, compared to 1,375 cash transactions worth Dh5 billion. Strong Gains Across Property SegmentsAbu Dhabi's office market remained resilient amid high occupancy and rental growth. Asking prices for office units climbed 6% QoQ to Dh2.25 million, while rents in core commercial districts jumped 8% QoQ and 31.8% YoY. Occupancy in these areas reached 90.5%. The city's total office supply stood at 3.9 million m2 of Gross Leasable Area (GLA).Key additions this year include the HB Office Tower on Yas Island and Masdar City Square, the latter set to contribute 50,000 m2 of new space in Q2 continued to benefit from strong footfall and tenant sales. In Q1 2025, shopping centre stock totalled 1.95 million m2 of GLA in UAE's e-commerce market is forecast to surpass Dh48.5 billion by 2028, with online sales expected to make up 15.3% of the total retail hospitality sector posted impressive growth, buoyed by tourism, the report occupancy in Abu Dhabi averaged 86.9% in the first two months of 2025, a 1.2% increase YoY. The city welcomed 800,000 hotel guests by February, with 5.2 million visitors in total during 2024 – a 28.7% annual average room rate rose 37.1% to Dh683, and revenue per available room (RevPAR) jumped 38.7% to Department of Culture and Tourism expects total hotel supply to exceed 50,000 keys by 2030, up from 34,372 in February 2025. Upcoming additions include the Mondrian Hotel in Downtown Abu Dhabi and the Waldorf Astoria, set to open at the former Anantara Eastern Mangroves site, offering 167 rooms with views of Mangrove National Park.
Khaleej Times
20-04-2025
- Business
- Khaleej Times
Villa market outshines as Dubai realty posts big Q1 sales surge
Dubai's real estate market kicked off 2025 with remarkable vigour, driven by a 65 per cent surge in villa sales transactions and a 56 per cent increase in their value, according to a report by Betterhomes. The first quarter saw the emirate's property sector maintain the robust momentum from 2024, with total sales transactions rising 23 per cent year-on-year to 42,422, and sales value climbing 29 per cent to Dh114 billion, as per Dubai Land Department (DLD) data. While apartments continued to dominate by volume, villas stole the spotlight. Transactions for villas jumped to 10,185, with their total value reaching Dh53.4 billion, reflecting strong demand despite limited supply. Apartments, meanwhile, saw a steady 14 per cent rise in transactions to 32,237, with their value increasing 12 per cent to Dh60.8 billion. Off-plan sales remained a key driver, accounting for 59 per cent of all transactions, with 24,942 deals marking a 25 per cent year-on-year increase. Louis Harding, CEO of Betterhomes, noted a significant shift in buyer preferences. 'While off-plan sales continue to lead, prime off-plan transactions dropped by 30 per cent, whereas secondary prime sales soared by 77 per cent. This indicates a growing appetite for completed, ready-to-occupy luxury properties,' he said. The trend underscores Dubai's maturing market, with buyers increasingly favoring high-quality, move-in-ready homes. Quarter-on-quarter, the market experienced a seasonal cool-down following a record-breaking Q4 2024, with transaction volumes dipping 10 per cent and values falling three per cent. However, specific segments bucked this trend. Villa sales rose 12 per cent, prime transactions increased 21 per cent, and Betterhomes reported a 51 per cent surge in sales leads, signaling robust buyer interest and pent-up demand. Christopher Cina, director of sales at Betterhomes, commented, 'Q1 2025 reaffirmed Dubai's resilience and global appeal. The shift toward end-users and mortgage-backed buyers reflects deeper confidence in Dubai as a long-term home and investment destination.' The leasing market also thrived, with Betterhomes recording a 49 per cent year-on-year increase in transactions and a 36 per cent jump in tenant leads. Rental prices for apartments and townhouses grew by 14 per cent and 7 per cent, respectively, while villa leasing surged 52 per cent quarter-on-quarter. This spike in demand for larger homes aligns with Dubai's growing family population and evolving lifestyle preferences, as more residents prioritize spacious living environments. Buyer enquiries across all property types reflected strong market confidence. Overall enquiries rose 14 per cent year-on-year and 51 per cent quarter-on-quarter. Apartments saw a 30 per cent increase in leads compared to Q4 2024 and 12 per cent year-on-year. Villas maintained high demand, with enquiries up 38 per cent quarter-on-quarter and 5 per cent year-on-year. Townhouses, however, emerged as a standout, with a 64 per cent surge in enquiries quarter-on-quarter and a 30 per cent rise year-on-year, highlighting their growing popularity among buyers seeking a balance of space and affordability. The sustained investor interest, coupled with Dubai's population growth and appetite for prime and villa properties, has fuelled the market's upward trajectory. However, challenges loom on the horizon. Rising prices and shifting investor sentiment could dampen enthusiasm for speculative off-plan segments. The market's resilience will hinge on timely supply deliveries and broader economic conditions in the second half of 2025. For now, Dubai's real estate sector continues to offer compelling value and global appeal, cementing its status as a premier investment destination. Analysts at Ozon Marketing point to Dubai's unique blend of economic stability, tax advantages, and lifestyle offerings as key drivers of its property market's strength. The emirate's ability to attract high-net-worth individuals and families seeking luxury homes has bolstered demand for villas and prime properties. Additionally, the growing presence of mortgage-backed buyers signals a shift toward long-term investment, further stabilizing the market. Analysts at Kaden Boriss noted that as Dubai's real estate market navigates the delicate balance between growth and sustainability, its performance in Q1 2025 underscores its enduring allure. 'With strong fundamentals and sustained demand across both sales and leasing, the emirate is well-positioned to maintain its upward trajectory, provided supply and economic conditions align,' an analyst said.
