Dubai: Al Reef Downtown and the Al Muneera areas of Abu Dhabi offer the highest yields — of around 9 per cent — in Abu Dhabi right now.
A standard two-bedroom apartment in Al Reef Downtown now rents for Dh110,000, while on Al Reem Island it will be Dh145,000. Al Bandar remains one of the most expensive locations — a two-bedroom apartment rents for Dh195,000.
On average, property investors can still aim for fair-to-middling yields on their property purchases in Abu Dhabi, even though nothing much changed in value and rental terms during Q1-16, according to an update from Chestertons, the consultancy.
Average yields in the city could be in the range of 6 per cent, the agency adds.
“It’s been an extremely quiet first quarter in terms of major announcements following a swathe of launches in H2 2015, but we are confident that any further launch announcements will be positively absorbed into the market,” said Declan McNaughton Managing Director UAE, Chestertons MENA. “Quality apartments proved to be the preferred choice of investors.”
With villas, rentals for entry level or lower range leases on three- bedroom villas are from Dh110,000 and climbing to Dh150,000 for a four-bedroom. Leases on an average three-bedroom villa in Al Reef would be Dh153,000, Dh195,000 in Al Raha Gardens, and Dh340,000 on Saadiyat Island.
“With supply failing to match current levels of demand, this has given landlords an opportunity to cautiously raise annual rental rates, although we are seeing a tempered approach where the increases are marginal,” said McNaughton.
“Moving forward, we believe the market will soften further exacerbated by uncertain economic conditions, and is fast approaching a period of consolidation.”
