The real estate market in Abu Dhabi is always changing. Investing in real estate is a lucrative and highly rewarding venture but it does require that one do his due diligence. Fret not, as in this blog, we summarize everything you need to know to stay ahead of the curve in 2023. Here is you property investment in Abu Dhabi guide for 2023.
Start with a goal in mind
When discussing real estate investments anywhere, it’s important to be aware of what kind of real estate investment you are hoping to come out with. Are you looking to find a property that you will easily find tenants to rent out to or are you looking to invest in a high-traffic tourist area where the value of your property will likely rapidly increase?
In either case, it is important to be aware of the geographic area you intend to invest in, its future development plans, and what its current state is in terms of the amenities available and the lifestyle it can provide its residents.
Time and geography
Areas that are isolated from facilities, malls, educational centers, and healthcare are generally low-value properties at the time being. However, if there are clear plans to change that about the area through the development of infrastructure and facilities, then properties in said area will be a lucrative investment opportunity due to its expected increase in value once these developments are complete. Generally speaking, looking three to four years into the future should be a standard operation when considering a real estate investment opportunity.
What does the data say?
Looking into market trends is also a necessary procedure to undertake when investing in realty. It is essential to look at the figures and understand which areas are experiencing the highest spikes in prices compared to past trends. Looking at this kind of data will also identify any red flag areas that you shouldn’t be investing in that have for example been experiencing stagnating prices. But more importantly, once you have identified a pattern, do some research and identify what may have triggered these patterns. Was it a new mall that was built in the area that suddenly caused the demand for rent to increase? Or was it possibly a new bus route that has been redirected towards this area that will make it incredibly easier for non-driving residents to get around and thus cause an increase in demand?
Choose the right developer
The developer of the project you choose to invest in can have a significant effect on the success of your investment. A seasoned developer with an already established brand name is a good bet, but that’s not to say that new developers are risky. The recent example of Q Properties and their ridiculously successful project Reem Hills (that sold out before it launched) has made that abundantly clear.
Generally, however, a well-established real estate developer will have the right connections to deliver truly unique projects that attract attention and in turn, demand. But more importantly, these market veterans will have their hand on the markets pulse and can predict customers wants and desires and more oftent than not, new projects are formulated based on satisfying those wants and desires when they are backed by data.
For the reason above, developers like Aldar are considered a rather safe investment due to their many years of experience and their firm command over the Abu Dhabi real estate market.
The famous Dubai developer Emaar has also recently entered the Abu Dhabi real estate market through a new independent development company they established by the name of Eagle Hills. Eagle Hills was recently involved in the launch of Ramhan Island, an island off the coast of Yas Island that is now being designed to become the world’s best residential resort island in the middle of the wild.
Real Estate developers in Abu Dhabi usually follow a certain pattern in their construction of new developments. Meaning there is a consistent theme throughout their developments. Some developers are known for their high-value but affordable properties, some are outspoken in the daringly lavish and extravagant projects they put out, while some may be more focused on enacting sustainability measures, minimizing emissions, and utilizing green energy.
What is the average ROI for properties in Abu Dhabi?
Although the average ROI for real estate in Abu Dhabi ranges from 5%-8%, off-plan projects in the emirate can rack upwards of 10% and 11% in ROI. It is however important to have a professional calculate the ROI of the particular property you want to invest in, as outliers do exist.
Some of the highest ROI areas in Abu Dhabi as of 2023 are:
- Al Reef (8.6%)
- Saadiyat Island (8.3%)
- Yas Island (8.1%)
Is buying property in Abu Dhabi a good investment?
Abu Dhabi’s real estate market is stable and offers attractive prospects for potential buyers due to the city’s government policies and the ongoing development of major infrastructure projects. Nevertheless, it is essential to conduct thorough research and seek advice from experts to make informed decisions.
Is it the right time to buy property in Abu Dhabi?
The present real estate market in Abu Dhabi is in its prime and is expected to attract many potential purchasers this year. In order to promote foreign investment and economic progress, the city’s government has initiated various policies, which have further boosted the real estate market in Abu Dhabi. Furthermore, with significant infrastructure projects like the new airport terminal (Abu Dhabi Airport’s Midfield Terminal) and metro system in the works, the worth of properties is anticipated to rise in the near future.
Is it better to buy property in Abu Dhabi or Dubai?
Investing in a property in Dubai essentially means that you are going to rely on the city’s touristic theme to generate profits. Investing in properties in Abu Dhabi means that you are aiming to target the local workforce and primarily local investors. Dubai is better for tourist-focused real estate investments, and Abu Dhabi is ideal for non-touristic real estate investments.
Even though as of late Abu Dhabi’s star in tourism has been rising and therefore more international investors are investing in real estate in this market, the reliance remains largely on local buyers.
Where can I invest money in Abu Dhabi?
Abu Dhabi offers many investment options from stocks, mutual funds, commodities, and most importantly real estate. If the simplicity of the investment is something that drives you, then real estate is the simplest and most lucrative opportunity among the aforementioned Abu Dhabi investment options.
Property investment in Abu Dhabi: Some final words
While choosing a property from the right developer, in the right place, with the right future prospects, and an appealing ROI are all important factors, there is something else to consider.
Competition from similar properties in close vicinity should not be taken lightly. Areas with too many similar realty options to compare may prove to be risky investments. It is therefore wiser to search and find areas with all of the abovementioned characteristics, but also enjoy little or no competition in the near vicinity.
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Gravity Real Estate
Gravity Real Estate is a leading real estate consultancy in Abu Dhabi that has been around for over a decade. With expert agents spread across every corner of Abu Dhabi and tight connections with the leading developers, there isn’t a real estate situation we cannot aid with.
Our diverse range of services includes everything from the sale and rent of all kinds of properties, property management, off-plan property investment, consultation services, and property marketing. Call us now to find out how we can help move your situation forward.
