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Mazaya Monthly Real Estate Report -
Week 4 - December 2015
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According to market data, the shortage
in supply of residential units in prime
areas of Abu Dhabi raised prices
by 10 per cent between January –
September of 2015, compared to
the corresponding period in 2014.
Forecasts and indicators:
The report stressed that Abu Dhabi’s
real estate market is characterised by
steadily rising demand on sales and
leasing, particularly on residential
units designated for low and middle-
income groups, which have so far
maintained their resilience and growth
in varying economic conditions.
According to the key indicators,
the market is still suffering from a
shortage of supply – be it residential,
retail, commercial, investment or
industrial sectors. All indicators
display a rising demand in all market
segments as a result of the continued
population and economic growth
rate, which is expected to increase
by five per cent and six per cent,
respectively, in the coming year.
Al Mazaya’s Report suggests that the
positive impact of the new law will far
exceed expectations because, until now,
there was a lack of a regulatory framework
in the emirate’s real estate market. It
should be taken into account that the real
estate market accounts for 40 per cent of
total business activities in the emirate;
therefore, there should be no doubt that
the investor and the end-user will be the
biggest beneficiaries fromthese new laws.
The residential sector is now considered
one of the key drivers of demand in the
emirate’s real estate market. Al Mazaya’s
Report says that this sector is currently
the best for investors – in terms of the
prevailing prices and one of the best rental
markets in terms of return. This because
AbuDhabi is amarket where landlords can
flexibly specify the rateof increasewithout
any law that caps the annual increase.
The rising prices are mainly in the
downtown area of the UAE capital
due to the shortage in supply and
the continued increase of rents by
landlords. More increases are expected
in 2016 due to the limited supply
in the market and rising demand,
particularly from middle-income groups.
At this level of demand, the net
revenues of rental units have risen
significantly as real estate still remains
the favorite channel for investment for
UAE nationals – the largest segment
of real estate investors in Abu Dhabi.