Abu Dhabi: There is to be no respite for Abu Dhabi’s tenants — the residential leasing market could see further spikes through the year as limited new supply tightens its hold.
Only 750 residences were delivered during the first three months, a period which also saw rental gains of an average 4 per cent quarter-on-quarter in the city, according to the latest ADIB Real Estate report.
A further 5,800 units are scheduled for completion during the rest of the year. “At 2.9 per cent of total housing stock, this represents the lowest level of new residential supply for five years, when average annual growth has been around 5 per cent,” the report notes.
But property values took a step back, the report adds, declining 4 per cent compared with levels at the end of Q4-2014. “What we are witnessing at the moment is that the lower oil price has temporarily dampened sentiment, but the market fundamentals remain strong,” said Paul Maisfield, CEO of MPM Properties, the real estate advisory subsidiary of Abu Dhabi Islamic Bank.
“A positive sign was Aldar’s ability to sell, in just one week, 281 villa plots at the Al Merief masterplanned community in March. In addition, gross residential yields are now at 6-7 per cent, which is attractive to investors.”
The market data are collated from transactions within its portfolio of over 23,500 units under the MPM Properties’ management.
