A lot of different factors continue to negatively impact Abu Dhabi’s real estate market, such as contractions in household income and workforce redundancies in both the public and private sectors. Although we believe that the past 12 months have had an overall beneficial effect on the market fundamentals, with offer and demand in the process of readjusting to more sustainable levels, these negative effects are still felt strongly and have been amplified on residential sales prices. We have witnessed widespread dips in the range of 4 to 16% within the last two quarters, depreciating faster than our yearly forecast, estimated at 15% until the end of 2017.
The prime market has unsurprisingly witnessed steeper contractions, as occupiers favour affordability and investors face increasing challenges to lease high-end products. New supply, coupled with the rise in secondary stock coming to the market, is expected to exert further downward pressure on sales prices in the short-term.
Source : Core Savills