Landmark Advisory releases Q209 Dubai and Abu Dhabi Real Estate Report

The independent report analyzes multi-source transaction data and other statistical trends, with a focus on master developers.

"Public research helps the market by allowing all stakeholders to compare free information," said Jesse Downs, Director of Research & Advisory Services at Landmark Advisory.

She added that "access to multiple sources improves objectivity." For example, Ms. Downs explained that "since mortgage activity is low, cash buys constitute a significant portion of transactions. Therefore, to accurately assess price trends, it's critical to have access to datasets containing both transaction types."

In both emirates, buyers and renters are showing renewed willingness to pay for better units and better locations. "Even if decline patterns differ between Dubai and Abu Dhabi, falling prices create excellent opportunities that boost demand in both markets. In April, we observed strong leasing and higher sales volumes," said Ms. Downs.

In Dubai, Emaar is faring best in terms of demand and pricing. According to Ms. Downs, "with a flight to quality clearly underway, end-user preferences are differentiating prices in favor of quality developers like Emaar and preferred locations like Dubai Marina."

In Q109, Emaar master developments accounted for approximately two-thirds of sales and 57% of new leases. More specifically, units developed directly by Emaar represented over half of sales and 39% of new rentals. "Residents in Dubai see Emaar as a source of quality, not only for master-planned communities, but also for individual buildings," said Ms. Downs.

Dubai Marina was the most popular area among renters, capturing 30% of all new annual leasing contracts. Emirates Living came in second, at 16%. Isolating apartments, Dubai Marina scored 30% of all new apartment contracts. For villas, Emirates Living dominated, with 40% of new villa rentals, followed by Mirdiff and Jumeirah/Umm Sequim.

Turning to Abu Dhabi, Ms. Downs explained that "the issue of first-phase master development integration will leave certain Abu Dhabi developers more vulnerable in the short- to medium-term." Landmark Advisory's analysis shows a positive correlation between price performance and proximity to central Abu Dhabi.

"Aldar's entire freehold/leasehold portfolio is in off-island developments on the city outskirts. In contrast, Sorouh will be less affected, as most of its freehold/leasehold properties are centered on Al Reem Island, which is close to central Abu Dhabi," said Ms. Downs. Sorouh's secondary market prices have retained 20%-25% average premiums over their primary prices, while Aldar's units averaged close to primary prices, and in some cases fell 10% below.

Ms. Downs added that "prospective end-users in Abu Dhabi will increasingly differentiate first-phases based on ease of access to alternative/nearby amenities, like those found on-island in Abu Dhabi. These differentiators are already reflected in prices." Overall, this trend is likely to continue for the next 2-3 years, until master developers integrate community-sustaining elements among project phases.

Landmark Advisory's Q209 Dubai & Abu Dhabi Real Estate Report is now available for download on their website.