House prices in Abu Dhabi increased in the second quarter

Prices in the emirate grew by 1 percent, while Dubai registered a slight drop, says JLL.

Average residential sale prices in Abu Dhabi increased in the second quarter of the year amid the property market recovery and the launch of new villa projects, a new report issued by the consultancy JLL says.

According to the report, house prices in the capital grew by 1 percent, compared with the same period last year, while prices in Dubai declined marginally by 2 percent.

Villa prices in both emirates jumped as a result of growing demand for larger homes due to the coronavirus pandemic.

In the second quarter Abu Dhabi villa prices registered an increase of 6 percent year-on-year, while the prices of Dubai units went up by 10 percent.

JLL notes, that new villa project launches in Abu Dhabi during the second quarter also had a positive effect on prices. Aldar, the capital's biggest real estate developer, announced new villa developments on Yas and Saadiyat islands, that were sold out in record time.

'Looking ahead, we expect outdated existing developments to continue to face pressure, particularly apartment developments, as new developments with larger unit layouts, attractive payment plans and community amenities have a stronger appeal to tenants and investors alike,' JLL pointed out in the report.

815 residential units were delivered during the quarter in Abu Dhabi, bringing the total stock to about 267,000 units. And by the end of 2021, 6,360 additional units are expected to come on to the capital's market.

Residential stock in Dubai increased to 618,000 units, 10,000 units were added to the market during the second quarter alone. Another 36,000 units are expected to be added to the market by the end of 2021.

UAE's property market continues to recover from the pandemic, thanks to the government's new supportive initiatives.

Real estate prices in Dubai rose by 2.1 percent in June to USD 251 per square foot, Property Monitor said in its monthly market report last week. Since bottoming out in November, prices have risen by more than 12 percent, it said.