The Abu Dhabi real estate market continues to face downward pressure during the third quarter of this year, with rent and sale prices experiencing a slight slump; even as over 1,100 new homes enter the property market.
Rents are dropping across the residential, retail and office segments given the decline in oil prices which continues to in turn impact government spending. As per the latest Abu Dhabi real estate market reports, rents for Abu Dhabi apartments witnessed on an average, a dip of 2 percent compared to the previous quarter. Abu Dhabi real estate sales prices on the other hand, fell by 3 percent approximately.
A wave of cost cutting measures and job cuts within the government, oil and gas, and financial services sectors seems to hit residential demand across all sectors in the capital. This downsizing has increased vacancy rates and is in turn placing downward pressure on rents and sales values, as residents are now looking for cheaper options in the emirate. Also, the majority of office demand in Abu Dhabi is from oil and government entities, further adding to the lull in prices.
A total of 1,160 units were delivered during Q3 across developments such as Shams Tower and Najmat C21 Tower on Reem Island, Saraya One on Saraya and two residential buildings within Rawdhat.
Broadly speaking, the third quarter is a quieter period than the rest of the year for real estate markets worldwide, so this dip in sales and rental prices shouldn’t come as too much of a surprise. The good news is that supply levels are stable, so it may only be a matter of time before demand catches up.
2017 will be a year of recovery for the Abu Dhabi real estate market and may unravel a host of new trends in the capital. Looking for Abu Dhabi real estate for sale or rent? We offer the most sought-after residential and commercial properties in the capital at your fingertips.
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