Abu Dhabi’s villa market remains undersupplied, as buyers continue to favour residential units with larger living spaces and recent deliveries were concentrated in apartment communities, according to a new report. 

A total of 6,000 villas and apartments were delivered in the UAE capital in 2021 and approximately 7,000 more are expected to be handed over this year, commercial real estate services firm CORE said in its annual report. Al Reem Island, a popular apartment district, saw a “large number” of the handovers in 2021, so the market is currently seeing a “relative oversupply of apartments”, the report noted. 

“[However], the villa market in Abu Dhabi remains relatively undersupplied with limited new deliveries expected in 2022,” said David Short, Head of Abu Dhabi. He noted that apartment projects expected in 2022 are also mainly concentrated on Al Reem Island. 

Rental market; 2022 outlook 

Last year, Abu Dhabi’s villa rental market saw a marginal 1 percent year-on-year rise, but apartments recorded a 2 percent decline due to oversupply. 

For 2022, CORE said it expects “continued success” for off-plan residential sales, particularly in the premium category in destinations like Al Reem, Saadiyat and Yas Island. 

Buyers will continue to prefer larger living spaces, so villa sales and rentals are likely to show “marginal” increases this year. 

(Writing by Cleofe Maceda; editing by Seban Scaria)