The luxury segment of the Abu Dhabi property market saw the most significant price increases in 2022, according to a new report.
The average price-per-square-foot for villas on Saadiyat Island increased 12.7 per cent annually amid a steady demand for waterfront properties, according to a report by property portals Bayut and Dubizzle.
Apartments on Saadiyat Island also appreciated by 13.2 per cent as the wider economy recovered from the effects of the coronavirus pandemic and the UAE saw an influx of high-net-worth individuals and new visa initiatives.
Abu Dhabi’s economy expanded 11.2 per cent in the first six months of this year on an annual basis, the latest government data released by the Statistics Centre — Abu Dhabi (SCAD) shows.
A number of projects were launched on Saadiyat Island last year, including Saadiyat Lagoons, a nature-inspired residential community, Grove District near Zayed National Museum and Louvre Abu Dhabi Residences.
Prices for villas on Yas Island rose 6.1 per cent in the same period, with the Yas Acres development in particular appealing to high-income investors seeking off-plan projects.
The price rise for luxury villas in Abu Dhabi mirrors the trend in Dubai, where there was a record for ultra-luxury property deals, with 219 sales of homes valued at $10 million and above registered last year, and a price appreciation of 44 per cent in the prime market.
“The overall stability of the capital city’s economy has continued to make it a destination of choice among property buyers interested in the region,” said Haider Khan, chief executive of Bayut and dubizzle and head of Emerging Markets Property Group Mena.
“In the last two quarters of 2022, there was a significant increase in both volume and value of sales transactions based on the data released by [real estate digital ecosystem] DARI.”
The value of transactions in Abu Dhabi increased by well over 60 per cent in the fourth quarter, he added.
Over the entirety of 2022, the total volume of transactions in Abu Dhabi reached 5,892, registering a 38.5 per cent growth compared to the prior year, according to property consultancy CBRE.
In the fourth quarter, the volume of transactions rose by 14.9 per cent from the previous year.
Looking forward, capital values in freehold villa communities will continue to see small increments, however, apartments are likely to see prices stabilise, Valustrat Consulting said in its 2022/23 Outlook.
“Off-plan project launches, with attractive payment plans which compete with mortgage options that have higher interest rates, may put downwards pressure on existing ready home prices during 2023,” it said.
“Residential rents are unlikely to see significant change this year.”
For a detailed perspective on the property market, visit: Abu Dhabi luxury property prices rise, with Saadiyat Island leading the way