The apartment rental market in Dubai, UAE, saw values edge down further, whereas in neighbouring emirate Abu Dhabi the scenario was different - with the market witnessing a resurge with an upward movement, said a report.

As always, the two main markets of the UAE continued to lure investors with relatively affordable prices and attractive rental returns on investment, with Dubai recording real estate transactions worth an impressive $43 billion by the end of August 2016, according to UAE-based property portal Bayut.

In terms of yields, Dubai’s apartment rental segment stayed relatively stable in August 2016, offering rental yields as high as 7.6 per cent in select categories.

Per Bayut.com’s calculations, average rents across the emirate fell by five per cent in August compared to values in July 2016, while average yield was recorded at 5.6 per cent across all bed categories.

The average rent for studio apartments in Dubai fell five per cent to Dh54,000 in August 2016 from Dh57,000 in July 2016. Despite the drop, the apartment category offered the highest property yield at 7.6 per cent, still garnering abundant interest from investors.

Rents for one-bed units performed better, going up by one per cent to Dh93,000 on average in August, coupled with an attractive rental yield of 6.8 per cent. Two-bed units fetched owners Dh142,000 in August on average, declining a mere two per cent compared with the average rent in July. The average yield for the category remained six per cent.

Three-bed units commanded an average rent of Dh197,000 on average after falling four per cent from July’s Dh206,000. The rental yield of the category hovered around the 5.1 per cent mark. Rental value for the four-bed category stayed stable in August at Dh304,000, with the rental yield recorded at five per cent.

Top localities for renting apartments in Dubai last month were Dubai Marina, Jumeirah Lakes Towers (JLT), Bur Dubai, Downtown Dubai and Dubai Silicon Oasis, according to Bayut.

On the best hotspots for buying apartments, the portal put Dubai Marina on top of the list followed by Jumeirah Lakes Towers (JLT), Downtown Dubai, Business Bay and Palm Jumeirah

The apartment rental market of Abu Dhabi posted stronger numbers than its glitzy neighbour, with the average rental value registering an increase of three per cent over July 2016 to arrive at Dh130,000, stated the UAE portal in its report.

At 6.6 per cent, the average yield for apartments in the UAE capital in August also remained stronger than Dubai’s.

Category-wise, studio units were the clear winners. Though rents stayed stable in August compared to July 2016, the impressive yield of 7.9 per cent made the apartment category a clear favourite with investors. At Dh56,000, the average rent for these units could also be termed affordable.

One-bed units recorded an average rent of Dh91,000, down 1 per cent from the July value; however, the average yield for the category was recorded at an attractive 6.8 per cent.

The average rent for 2-bed apartments increased by 2 per cent to Dh132,000 in August from Dh129,000 in July 2016, while the average rent for 3-bed apartments fell to Dh171,000, registering a negligible decrease of 1 per cent in August 2016. Average yield for 2-bed units in Abu Dhabi was recorded at 7.1 per cent, while 3-bed apartments featured an average rental yield of 6.3 per cent.

The average rent for 4+ bed apartments fell 5 per cent to Dh235,000 in August 2016, while rental yield for the category remained 5.5 per cent.

According to Bayut, the top localities for renting apartments in Abu Dhabi were Al Reem Island; Khalifa City; Al Raha Beach; Al Muroor and Corniche Area.

For buying apartments, the porttal put Al Reem Island on the top followed by Al Raha Beach, Al Reef,
Saadiyat Island and Ghadeer.

On the outlook, Bayut said the two leading emirates continue to be ahead of the regional pack when it comes to return on investment and avenues for capital value growth.

With its new world charm, luxury lifestyle and expanding economy, Dubai remains head and shoulders above its peers for being a truly unique real estate market that is as advanced as some of the most sought-after investment destinations, and in most cases, much more rewarding, it stated.

On the other hand, Abu Dhabi is warming up for a development spree in the coming years that is set to boost its status as a key regional and international realty hub further.

The two combined continue to not only provide immense benefits to investors, but also to the UAE economy as it persists with its drive to prosper through diversity, it added.-TradeArabia News Service