Abu Dhabi’s real estate market has experienced a transformative year, with high-end properties witnessing soaring demand while affordable housing areas begin to catch up. The 2024 Abu Dhabi Secondary Market Transactions Report issued by Crompton Partners Real Estate Agency sheds light on these trends, revealing record-breaking growth in areas like Saadiyat Island and an emerging shift in investor preferences.
In an interview with media, Ben Crompton, Managing Partner at Crompton Partners, provides his valuable insights into the report’s findings, highlighting the forces driving the market’s resilience and adaptability.
A noteworthy trend in 2024 has been the market’s broad-based growth. While luxury areas like Saadiyat and Yas have led the charge, more affordable locations, including Reem Island and Al Reef, are now witnessing increased demand by “lower-middle-class buyers with smaller budgets, who are now willing to buy instead of rent after seeing its consistent growth.”
The rise of middle-class buyers in the market is a healthy sign, he said, as it indicates sustainable growth and diversification. This trend also reflects rising rental prices in these areas, driven by higher purchase costs and limited supply.
While Reem Island recorded a 6.3 per cent decline in average sales prices in first half of 2024, the latter half of the year saw a rise in both rent and sales prices in the island’s property. During the same period, prices went up in Al Reef as well; both areas were considered economic “havens” before.
“We expect to see anywhere between a five and 10 per cent price growth in those areas next year,” he said.
While Saadiyat prices have been on a regular rise for a long time, “these areas have been havens for a while where rents were stable, but now they’re going up as well.”
Meanwhile, the demand for luxury villas and penthouses has reached unprecedented levels. Transactions for secondary market villas in Hidd Al Saadiyat and off-plan units at Nobu Residences have reached Dh130 million. Crompton identifies the post-pandemic recovery as a turning point for this market segment.
“Before Covid-19, the market was sluggish due to the 2015 oil crash. Now, buyers see stability and long-term value, driving capital commitment.”
High-end projects like Saadiyat Grove and Saadiyat Lagoons have further boosted investor confidence, delivering leveraged returns of over 100 per cent in some cases, he said.
Saadiyat Island has solidified its position as Abu Dhabi’s most coveted real estate destination. Mamsha Al Saadiyat, in particular, reported a staggering 58.8 per cent increase in average sales price per square metre, outpacing all other areas.
Crompton attributes this boom to Saadiyat’s prime location near Abu Dhabi Global Market (ADGM), attracting financial professionals and high-net-worth individuals. Saadiyat’s appeal as a luxury hub for affluent buyers and professionals makes it a key area for growth, due to its world-class amenities and proximity to the cultural district.
Meanwhile, Yas Island’s Noya community emerged as another highlight, boasting the highest annual turnover rate at 16.7 per cent. This vibrant community has proven particularly popular with families and first-time buyers.
Al Reef Villas Phase 2 recorded the lowest turnover at 2.7 per cent, indicating opportunities for long-term investments. Al Reem Island stood out as the area with the highest number of transactions, with 1,352 units sold, amounting to Dh1.54 billion. Saadiyat Island, despite hosting the fewest transactions with 99 units, led in transaction value at Dh1.67 billion, demonstrating the premium nature of its properties.
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