Abu Dhabi / Dubai real estate market: The two horsemen
Source: REIDIN , Author: Posted by BI-ME staff
Posted: Thu March 16, 2017 1:25 pm

UAE. An examination of the Abu Dhabi and Dubai real estate market reveals that since 2012, Dubai apartments have experienced superior growth rates (2x) to those of Abu Dhabi. Remarkably in the villa segment, capital gains in both cities have mirrored each other indicating that in the horizontal space there is an equal value being perceived by investors.

In the rental space both cities have followed the same trajectory as prices. Dubai apartment rental rates have appreciated more than 35% since that time, while apartment rates in Abu Dhabi have slipped back to the 2012 levels. In the villa space, rental rates of both cities have moved in tandem over the past 5 years.

In 2016, Abu Dhabi had a completion rate of 75% whereas Dubai stood at 48%. The realization rates of supply in both cities have been systematically lower, indicating not only the flaws in the estimates made by analyst, but also a greater sensitivity on the part of developers to adjust to the market conditions.

Investors have already started to perceive similar economic value in the villa space between the two cities. As the capital state ramps up supply in the mid income space, it is likely that the price cycles of Abu Dhabi and Dubai will start to converge, reflecting the symbiotic economic performances of the two Emirates.

Although relative locational and regulatory advantages may be something that investors focus on during price cycles, the overall market dynamics indicate that prices should start moving in tandem between the two cities in the coming years.

To read the full report click here.

About REIDIN
REIDIN is the leading real estate information company focusing on emerging markets. REIDIN offers intelligent and user-friendly online information solutions helping professionals access relevant data and information in a timely and cost effective basis.

About Unitas
Unitas believes in in-depth planning and discipline as a mechanism to identify and exploit market discrepancy and capitalize on diversified revenue streams. The purpose of Unitas is to manage, direct, and create wealth for our clients.

 

MIDDLE EAST BUSINESS COMMENT & ANALYSIS

date:Posted: August 20, 2017
UAE. According to MEED Projects, just US$56bn worth of contracts were awarded in H1 2017 compared with US$69bn over the same period in 2016; Long-term prospects bright with over US$2 trillion of known active projects in the pipeline across the GCC.
date:Posted: August 18, 2017
UAE. As many as 292 tenders with an estimated value of US$9.5 billion were awarded in Q2, while the total value of urban construction project awards set to reach US$50.9 billion in 2017, according to BNC Network.
date:Posted: August 17, 2017
UAE. Inaugural Global Interconnection Index finds interconnection becoming an essential building block of the global digital economy.
dhgate