Abu Dhabi's property sector showed signs of recovery in the second half of last year as movement restrictions relaxed across the country, according to a new report.
The government’s economic stimulus packages and prompt measures to prevent oversupply in the market have boosted the sector's competitiveness, according to Bayut and dubizzle’s annual report for 2020.
Relief programmes announced by Abu Dhabi-based developer Aldar Properties also supported the property sector, while attractive property prices continued to incentivise buyers and investors, the report said.
In addition, the emirate's recent public health campaigns and UAE-wide social reforms have also boosted confidence amongst local and overseas investors.
"Given the exceptional circumstances we encountered in 2020, it’s remarkable to see how demand has sustained and even grown in the capital," Haider Ali Khan, the chief executive of Bayut and dubizzle and the head of EMPG Middle East and North Africa, said.
"It’s not surprising that rents have become more competitive, considering how price sensitive the market is at the moment, but what is reassuring is the performance of the sales market."
He added that price fluctuations in the sales market have been "extremely controlled", with some high-end areas even recovering over the course of the year. This was partly due to the government’s efforts to contain the pandemic and support the real estate sector in Abu Dhabi, he said.
A separate report by Valustrat also indicated signs of recovery in the Abu Dhabi property market at the end of last year.
In the fourth quarter of 2020, the emirate's residential investment zones saw a one per cent quarterly uplift for the first time in three years, it said.
According to Bayut & dubizzle’s annual report for 2020, residential property prices in Abu Dhabi have shown resilience, reporting declines of under 10 per cent for properties for sale in the most popular neighbourhoods.
Prospective buyers and investors interested in affordable apartments have focused their attention on freehold suburbs such as Al Reef and Masdar City, while those looking for upscale flats preferred Al Reem Island, it said.
Al Reef has continued to take the lead for affordable villa sales, while Saadiyat Island and Yas Island have maintained their appeal among investors interested in upscale villas.
Budget-conscious tenants looking for apartments also preferred suburban communities and older central neighbourhoods such as Khalifa City A and Al Khalidiyah. Those interested in upscale apartments have searched for luxurious units in waterfront districts such as Al Reem Island and Corniche Area.
Mohammed Bin Zayed City remained the top choice for tenants interested in budget rental villas in 2020 and Al Bateen has maintained its popularity among tenants looking for expensive villas for rent, the report said.
Looking ahead, both reports are optimistic about Abu Dhabi's property market in 2021.
Subject to the health crisis being resolved, the economy is expected to improve and with Dubai Expo and the 50-year anniversary of the UAE, market sentiment is expected to pick up and could head towards bottoming out during 2021, Valustrat said.
With balanced new supply coming to Abu Dhabi in the coming years, rents and capital values in established villa locations could stablise and perhaps see gradual appreciation, while apartments could follow suit towards the end of 2021, it said.
Bayut & dubizzle’s report was similarly upbeat about prospects for 2021.
"We’re optimistic about the year ahead, especially since the capital has left no stone unturned in combating the pandemic," Mr Khan said. "The widespread vaccination campaign launched by the Abu Dhabi health authorities has also been critical in cementing the emirate’s appeal among residents and investors.”