The real estate market in Abu Dhabi has been relatively steady in the second quarter of 2014 with prices and sales seeing little movement, according to the latest residential report from Asteco.
It says that on average villa prices remained stable with increases of only 2% and overall there was continued levels of demand for all types of property.
Transaction levels for freehold development such as Golf Gardens and Al Raha Gardens were steady but affordable developments such as Al Reef saw no growth during the quarter as prices had peaked earlier in the year.
Rental rates also remained relatively stable with quarterly growth rates ranging from 0% to 7%. High end developments saw the highest levels of growth and the report says that reflects a clear preference for newer, master planned traditional supply on the Main Island.
It also points out that with the removal of the rent cap, several lower end properties leased as reduced rates have reverted back closer to market rents, especially in areas such as Central Abu Dhabi and Khalidiya/Bateen.
It has also been announced that a rental index will be launched in Abu Dhabi later this year with the aim of creating a more transparent market and regulating maximum rental increases.
The report also points out that with rental rates at Al Reef Villas reaching significant highs they are 14% higher than in the second quarter of last year.
The high rents seen in Al Reef led to an overflow of demand for Hydra Village where villas had already achieved a 5% rental increase since the third quarter of 2013.
‘Nonetheless, we do not foresee significant increases in Hydra Village, at least until proper landscaping and supporting facilities are completed,’ the report says.
This article was republished with permission from Property Wire.