Last updated: November, 2022. --- As the capital city of the United Arab Emirates (UAE), and the second most populous city after Dubai, Abu Dhabi offers property investors and expats an attractive opportunity for investment. Thriving oil exports and commerce have been reinvested into the city, reflected in the sleek skyline, huge shopping malls, and lush green spaces throughout the island city.
Abu Dhabi is a proud, cosmopolitan city, considered to be the cultural heart of the UAE. The Sheikh Zayed Grand Mosque is a testament to that fact, with no expense spared in its construction. The place of worship continues to attract both residents and tourists alike due to the sheer scale and beauty of the structure and its accessibility for non-Muslims.
Abu Dhabi is accustomed to foreign investors and expats visiting, living and working in the city. Indeed, the Formula One Grand Prix takes place every year, attracting F1 fans from across the world. Even Ferrari-World provides entertainment for families looking for a day out. This article will describe some of the most promising areas in Abu Dhabi for property speculation.
Al Reem Island
Al Reem is a natural island, located near the coast of Abu Dhabi island. Fortunately, Al Reem has multiple bridges which connect to the mainland. In recent years, the off-shoot of the city has developed into a bustling community in its own right. Al Reem now boasts a lucrative property market for prospective investors and/or expats hoping to settle down in Abu Dhabi.
A conflagration of residential, commercial and retail property units, Al Reem features rental yields of 8.09%, 7.06% and 6.36% per annum for Studio, 1-Bedroom and 2-Bedroom apartments respectively. However, areas such as Al Reef, Shakhbout City, Mohammed Bin Zayed City and Khalifa City A, can offer ROI as high as 9.43%.
Popular among tenants for its affordability and connectivity to the rest of Abu Dhabi, Khalifa City is a quiet residential area which frequently attracts expats. The place is still commonly referred to by its old name, Khalifa City A. Khalifa City is home to the Abu Dhabi Golf Club and Al Forsan International Sports Resort, both popular attractions for visitors and residents.
Khalifa City is also close to Dubai, offering residents a well-connected commuter belt to travel from. Average rental prices for a studio, 1-bedroom and 2-bedroom property will cost (AED) approximately 27k, 43k and 61k respectively. ‘Villa Compound’ provides property investors with access to secure 5-to-6-bed homes, ensuring privacy and seclusion.
Al Raha Beach
Only 40 minutes from Dubai and 10 minutes from Abu Dhabi International Airport, Al Raha is a popular leisure destination in Abu Dhabi. With two precincts, Al Raha Beach and Al Raha Gardens, - both further divided into 11 sub-communities - the area has more to offer than initially meets the eye. Al Raha also boasts 5.2m square feet of natural shoreline.
Due to its proximity to the waterfront, Al Raha Beach is one of the most popular places to purchase luxury properties in Abu Dhabi. Young professionals as well as families are attracted to the vibrant lifestyle of the area. This is reflected in the property market, as the average sale price for an apartment is 929k AED for a studio and 2.9m AED for a 4-bedroom apartment.
Situated directly adjacent to Al Raha Beach, Yas Island houses the legendary Yas Marina Circuit - home to the Abu Dhabi Grand Prix. The range of leisure activities, and beautiful waterfront views, makes Yas Island a popular destination for tourists and families. Furthermore, the Island is one of the most attractive areas in both Abu Dhabi and the UAE for property investment.
The Department of Municipalities and Transport (DMT) released figures showing Yas Island topped the list for real estate transactions in Abu Dhabi Q1 2022 - including sales, purchases and mortgages of all types of lands and buildings. Yas Island recorded 1.2bn AED in real estate transactions, with Al Saadiyat Island trailing far behind in second place with 673m AED.
Another natural island and tourist hotspot, Al Saadiyat Island is a cultural, retail and residential hub in Abu Dhabi, offering prominent investment opportunities for housing speculators. Saadiyat Island is a prestigious location, with prices in the community reflecting its high value status. Indeed, villas and apartments are the primary residences on offer.
Prices start at approximately 540k AED and, for some types of properties, the average price can fetch nearly 7m AED. Meanwhile, the average rental price is 35k AED per annum. With new properties available close to the sea, Saadiyat epitomises luxury living in Abu Dhabi. For those with a large enough budget, the island can be a lucrative investment opportunity.
Running in parallel to Corniche Beach and in close proximity to Etihad Towers, Corniche Road is one of the most recognisable and iconic parts of Abu Dhabi. With 8km of maintained waterfront - featuring children’s play areas, cycling paths and restaurants - the Corniche Road alone offers sea views, comfortable living and fantastic quality of life.
Uniquely, Corniche Road does not offer freehold properties. Instead, the only properties available are to rent. The majority of these properties offer views of the Corniche. As such it is popular for those looking to rent. The vast majority of the properties available are high-rise towers, and searches for properties are split 97% in favour of apartments and 3% villas.
A cultural hub within Abu Dhabi, Al Khalidiyah exemplifies the city’s rich history, whilst also providing a central location for residents and expats to live in modern-day comfort. In terms of amenities, the area is home to the Khalidiyah shopping mall, which offers a range of boutique outlets and restaurants. The area is also close to the popular Corniche Beach.
In relation to properties on offer, Al Khalidiyah is notable for its high-rise apartment towers - such as Al Ain Tower - and gated villa communities. Apartments in the area on average cost 33k, 57k and 64k AED per annum for studio, 1-bedroom and 2-bedroom properties respectively. Villas range from 158k AED for a 4-bedroom property up to 291k AED for a 7-bedroom villa.