Prices expected to remain steady despite less activity, consultancy says
Abu Dhabi property activity is set for a “noticeable slowdown” in 2016, compounded by a reduction in government spending and stagnant salaries, according to Asteco.
The real estate consultancy said it sees a dip in demand for property this year, although prices are forecast to remain stable, after “modest market gains in 2015”.
Last year saw apartment rental rates and sales prices rise, while villa rentals rose 2% and sales prices were flat, Asteco said its latest UAE Real Estate Report.
“Expatriates make up around 75% of the population in the capital and are a major demand driver for residential property. So unless there is a significant shift in labour requirements, we feel that the existing supply and demand dynamic will keep the market in equilibrium in the short to medium term,” said Jerry Oates, General Manager, Asteco Abu Dhabi.
“In addition, the new property law – No.3 of 2015 – should boost investor confidence with improved sector regulations across a number of key areas.”
A total of 2,000 apartments and 100 villas were delivered last year, Asteco said. These included 850 units in phase one of Reem Island’s Hydra Avenue project, 160 units at Sea Side Tower, also on Reem Island, and 312 serviced apartments at Saraya’s Creek Tower on the Corniche.
Abu Dhabi will add 3,000 apartments and 850 villas to its residential supply this year, including Wave Tower with 229 units and Solaris Towers with 600 units on Reem Island, and phase one of Hidd Al Saadiyat (488 villas), Asteco added.