The region is in high demand among renters, with Al Reem Island emerging as the top choice for apartment rentals in both Q1 and Q2 of 2023. This year, it has claimed the leading position, surpassing its 2022 ranking when it stood at third place in tenant demand. These statistics underscore the growing popularity of Al Reem Island as a preferred residential destination for individuals in search of a comfortable neighborhood in Abu Dhabi.
Prospective tenants opt for Al Reem Island due to several advantages:
1. Families seek a neighborhood with educational facilities and recreational options for evenings and weekends. Al Reem Island boasts schools and nurseries following British and American curricula. Some residential complexes are within walking distance of Reem Central Park and Al Fay Park, which feature children’s play areas and sports courts.
2. Business professionals prefer residences close to their workplaces. Al Reem Island offers developments with both residential and commercial properties, including Al Qurm View, Sky Tower, Addax Park Tower, Tamouh Tower, and more. Within a 10-minute drive, one can find offices of IT companies, banks, airline headquarters, hospital buildings, and other essential amenities.
3. Students come to Al Reem Island to attend Sorbonne University Abu Dhabi, the French and English-speaking branch of Paris-Sorbonne University.
Due to the strong demand from various tenant categories, the resident population on Al Reem Island has increased. This heightened demand presents a lucrative opportunity for investors to profitably rent out their properties.
Investors have the potential to earn a reliably high income by leasing their property on Al Reem Island. The table provided illustrates the average return on investment rate for the first and second quarters of 2023.
Al Reem Island presents apartments across affordable, mid-range, and luxury categories, offering investors a diverse range of properties to choose from based on their budgetary allocations for renting out.
The rental rates in the vicinity remain constant from Q2 2022 to the corresponding period in 2023. Due to the stability in rental charges, investors can have assurance that their annual income will not decline.
In accordance with Abu Dhabi’s regulations, property owners have the authority to increase the rental rate once a year, with a maximum cap of 5%. To illustrate, we examine the average price of a one-bedroom apartment and compute the difference over a five-year period.
Al Reem Island showcases a variety of studios and apartments ranging from 1 to 5 bedrooms. Investors have the opportunity to explore offerings from well-established UAE developers, such as Reportage Properties, Aabar Properties, RAK Properties, Tamouh Investments LLC, and several others.
Properties developed by Aldar Properties, the most sought-after developer in the emirate, are also available in the vicinity. Renowned for its projects in Abu Dhabi, including Yas Mall, Saadiyat Beach Golf Club, and the luxury W Abu Dhabi hotel, Aldar Properties presents residential and commercial complexes on Al Reem Island, such as Arc Towers, Gate Towers, Sun and Sky Towers, among others.
In the event that investors alter their strategies and opt not to lease their property, they have the option to sell it under favorable conditions. Property prices may increase by nearly a quarter of the real estate value within a year or by approximately one-sixth over one or two quarters.
Given the fluctuating property values on Al Reem Island, investors have the opportunity to resell their properties at a higher price than their initial purchase. The following examples, which have not been discussed in this article, illustrate this potential.
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