In recent months, the news for investors thinking of putting their money into property in Abu Dhabi has generally been poor. Here at Holborn Assets, we’ve talked about a number of different factors that have had a dampening effect on the market, from the new VAT rules to a general mood of caution among developers who are holding off from making any big moves in the region. However, there are some areas – particularly in Abu Dhabi – where we think there is still potential for investors to see some positive returns.

A flat outlook – for now

Before we look at them, it’s worth saying that the bottom line remains the same – that prices (sales and rental) are unlikely to move much above their current levels in the near future. The words of one expert last year – Arlene Jimenea, Senior Research Analyst, CBRE Middle East – still hold true now, in our judgement: “Despite improvements in average oil prices, there are still no apparent major demand generators that might significantly alter the current downward trend on rents. In the sales market, prices are likely to level off as more investors will likely opt to hold properties in light of low transaction activities and weak market sentiment.” That process of ‘levelling off’ is still ongoing in Abu Dhabi, and we believe it will be for some time.

Opportunities for growth

Growth is expected soon, however, with events such as Expo 2020 and several new property launches on the way potentially driving a gradual upward turn. With this in mind, we suggest that it might well be worth looking now at the areas in Abu Dhabi that have shown the most resilience to the recent slowdown. A recent report by the property experts at Bayat.com looks at the areas in which investors can expect to see a good return on investment.

The best for ROI in Abu Dhabi

Top of the pile is Al Reef at 7.67 % ROI, followed by Al Ghadeer at 7.40 %, Al Raha at 7.17 %, Al Raha Gardens at 7.10 % and Al Reem Island at 7.09 %. Al Reef is leading the way largely because of an attractive combination of villas and apartments – and it also well within the popular affordable sector for buyers. For those investors looking for a mix of townhouses and low-rise apartment blocks – or even commercial and retail spaces – Al Ghadeer also makes a great option for investors looking for good returns.

“Return on investment is arguably the most important factor that investors take into consideration when purchasing a home,” says Haider Ali Khan of Bayut.com. “This can come in terms of asset appreciation over time or rental yield. Our data for Abu Dhabi’s top localities, reveals that rental yields are hovering around 6 percent of the sales prices as of today. We expect this number to remain relatively stable through 2018.”

The research makes interesting reading for anyone who thinks that there are currently no opportunities to get a decent return on your investment in Abu Dhabi. And these are areas that we will certainly be watching closely as the market begins to pick up again.