Abu Dhabi real estate: Analysts identify top places to invest in apartments and villas, ROI of over 8% identified

Bayut identifies key property trends in Abu Dhabi in 2023, with data on best return on investment for apartments and villas across the city

Abu Dhabi real estate investors saw returns of more than 8 per cent on selected properties in the city last year, according to data from the Bayut Annual Sales Report for Abu Dhabi in 2023.

Property specialists Bayut released its Abu Dhabi annual sales market report for 2023 and the report analysed sales data and identified sales trends in Abu Dhabi last year.

It looks at top areas for luxury and budget apartments and villas in the city.

Abu Dhabi property investment

Abu Dhabi has experienced significant growth and development, making it a hotspot for real estate investment.

One of the key trends in the Abu Dhabi sales market report is the increasing demand for luxury properties, said the Bayut report.

The emirate has seen a rise in the number of High-Net-Worth-Individuals (HNWI) seeking luxurious and exclusive homes. This demand has propelled high-end residential projects catering to discerning tastes.

Abu Dhabi
Image: Shutterstock

Luxury property in Abu Dhabi

Luxury apartments in Abu Dhabi

According to the Bayut report, HNWI (high net worth individuals) favoured the following communities in 2023:

  • Al Reem Island
  • Yas Island
  • Saadiyat Island

Al Reem Island has a reputation for offering a great selection of high-end properties and continues to be the top choice for those looking to buy luxury apartments in Abu Dhabi. The average price-per-square-foot for Al Reem Island apartments for sale was AED1,048, representing a 0.73 per cent increase from 2022.

Al Raha Beach, known for its trendy waterfront living, is the second most popular spot for luxury apartment purchases in Abu Dhabi.

Yas Island was another preferred choice for High-Net-Worth Individuals (HNWI) looking to purchase luxury apartments in Abu Dhabi in 2023. The price per square foot of upscale apartments for sale in Yas Island increased by 1.72 per cent from 2022 to reach AED1,332 in 2023.

The Bayut annual real estate market report for 2023 also highlighted that buyers were inclined towards the high-end flats for sale in Saadiyat Island.

The area witnessed an 8.73 per cent increase in average price-per-square-foot to stand at AED1,942 in 2023.

The luxury apartment market in the city has witnessed impressive ROIs in certain areas. Among the best-preforming areas for ROI were:

  • Al Reem Island: 6.65 per cent
  • Yas Island: 6.52 per cent
  • Al Raha Beach (apartments): 5.46 per cent
Miral Yas Island

Luxury villas in Abu Dhabi

According to the Bayut report, the best neighbourhoods for investing in high-end villas in Abu Dhabi last year were:

  • Yas Island     
  • Saadiyat Island   
  • Al Raha Gardens

Yas Island was the top choice for luxury villa purchases in Abu Dhabi. The average price-per-square-foot for villas for sale in Yas Island is AED1,149, a minor decrease of 0.2 per cent from 2022.

Saadiyat Island was also a hit with High-Net-Worth Individuals (HNWI) for buying luxury villas in the city. The price-per-square-foot for houses for sale in Saadiyat Island increased by 12.9 per cent to stand at AED 1,934 in 2023. This hike can be attributed to properties listed at higher prices to tackle increasing demand, particularly in Saadiyat Beach and HIDD Al Saadiyat.

Al Raha Gardens was a hit for investors looking to buy upscale villas in Abu Dhabi. Villas for sale in Al Raha Gardens experienced a 0.95 per cent increase in price-per-square-foot to stand at AED 851 in 2023.

Investors looking for a high return on luxury villas, saw gains in Al Raha Gardens, Yas Island and Saadiyat Island last year,

According to the Bayut annual sales market report for the city, top ROI was:

  • Al Raha Gardens: 6.04 per cent
  • Yas Island: 5.19 per cent
  • Saadiyat Island: 4.35%
Abu Dhabi real estate: Analysts identify top places to invest in apartments and villas, ROI of over 8% identified

Affordable property in Abu Dhabi

Affordable apartments in Abu Dhabi

The residential property market in Abu Dhabi overall has seen varying pricing trends during 2023. According to the Abu Dhabi annual sales market report, budget-conscious buyers were attracted to areas such as:

  • Al Reef
  • Al Ghadeer
  • Khalifa City
  • Hydra Village

Bayut’s data shows that Al Reef remains the top choice for those seeking affordable apartments in the emirate. The average price-per-square-foot for flats for sale in Al Reef was AED644, which indicates a 2.05 per cent decrease from 2022.

Al Ghadeer ranked second among the top areas in Abu Dhabi for buying inexpensive flats. Those interested in apartments for sale in Al Ghadeer will find that the average price-per-square-foot rose slightly to AED717, a 0.33 per cent increase from the previous year.

Investors searching for reasonably-priced flats in Abu Dhabi have shown a preference for Masdar City. In 2023, the average price-per-square-foot for apartments for sale in Masdar City decreased by 2.05 per cent, reaching AED1,159.

Regarding return on investment (ROI), areas offering good rental yields for budget-friendly apartments, in the emirate included:

  • Al Reef: 8.04 per cent
  • Masdar City: 7.31 per cent
  • Al Ghadeer: 7.14 per cent

Affordable villas in Abu Dhabi

According to Bayut’s 2023 real estate market analysis, the best place for affordable villas in Abu Dhabi last year were:

  • Al Reef
  • Khalifa City
  • Sl Samha
  • Al Ghadeer
  • Hydra Village

Al Reef remained the most attractive option for purchasing affordable villas in the UAE capital. The average price-per-square-foot for villas for sale in Al Reef increased by 1.3 per cent from 2022, standing at AED718.

Investors searching for reasonably-priced villas in the emirate also showed interest in Khalifa City, making it an attractive area for investment. The average price-per-square-foot for villas for sale in Khalifa City increased by 1.84 per cent to reach AED854 in 2023.

The average price-per-square-foot for villa sales in Hydra Village dropped by 0.25 per cent, while Al Ghadeer saw an uptick of up to 1.78 per cent. Al Samha villas for sale also reported a 3.95 per cent hike in the average price-per-square-foot.

Investors seeking profitable returns on affordable villas in the emirate could consider the following areas, due to positive ROI:

  • Hydra Village: 6.78 per cent
  • Al Reef: 6.15 per cent
  • Al Ghadeer: 6.13 per cent

This Article is originally published on: https://www.arabianbusiness.com/

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