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1. Definition of the area and data structure
Actual location: According to DLD, the building SHERENA RESIDENCE, in which 1-bedroom apartments are being analysed, is located in the Wadi Al Safa 3 area within the Majan master project.
The DLD database has been analysed using only verified data; all figures are based exclusively on sales and rental datasets for this building, the master project and the area.
2. Liquidity of the property and the area – transaction and rental volumes
There have been 289 recorded transactions in SHERENA RESIDENCE. The transaction frequency for 1-bedroom apartments has shown stable activity since 2021, with volumes increasing in 2023 and over the last 12 months (mid‑2023 to mid‑2024). This confirms the liquidity of this segment. The DLD database records more than 1,000 valid rental contracts for this project (across all apartment types), indicating high rental activity and sustained demand.
Overall, liquidity in Wadi Al Safa 3 is also high, which makes the property comparable to the wider market in terms of demand.
3. Price dynamics over 3–5 years (SHERENA RESIDENCE and the area)
Dynamics of the average price per m² (1-bedroom apartments, residential stock only, valid transactions):
– For SHERENA RESIDENCE: since 2021 the average price per m² has been gradually increasing — from around 6,700–7,500 AED/m² in 2021–2022 to current levels of about 9,200–9,400 AED/m² over the last 12 months, while in Q2–Q4 2024 projects are showing growth to 9,000–9,700 AED/m². The increase over the past 2.5 years is approximately 30–35%.
– For Wadi Al Safa 3 (1-bedroom apartments): price levels are noticeably higher — on average 13,850 AED/m² over the last 12 months. Moreover, in 2024 the area has seen an acceleration in growth — quarterly figures exceeded 13,000–14,000 AED/m², with individual peaks up to 15,000 AED/m².
Throughout the entire period, SHERENA RESIDENCE has been trading at a significant discount to the area (lagging the average price by 30–40%).
4. Rental rate dynamics
The sample validation for SHERENA RESIDENCE is confirmed: more than 1,000 contracts, with the average rent calculated across all apartments (there have been no recent new contracts specifically for 1-bedroom units, so all types are used).
– Over the last 12 months, the average rental rate in the building amounted to 805 AED/m²/year.
– In Wadi Al Safa 3, the comparable average rental income level is 794 AED/m²/year.
Over the past two years, both SHERENA RESIDENCE and the area as a whole have shown a noticeable increase in rental rates: back in 2022, values were closer to 500–600 AED/m²/year, whereas in 2024 they are consistently above 800 AED/m²/year. Periods of peak values reflect both overall market conditions and possible one-off spikes from individual large contracts.
5. Current price and rental levels over the last 12 months
According to verified DLD data, the average levels are:
– Average purchase price of a 1-bedroom apartment (per m²) in SHERENA RESIDENCE over the last 12 months: 9,234 AED/m².
– The comparable figure for Wadi Al Safa 3: 13,853 AED/m².
– Average annual rent per m² in the building: 805 AED/m².
– Average annual rent per m² in the area: 794 AED/m².
6. Gross yield (ROI) and fair price range
Gross yield calculation:
– For the building: the ratio of average rental rate to purchase price is 8.7%.
– For the area: the comparable figure is 5.7%.
Taking into account additional entry costs (7–8% of the price: DLD fees, brokerage, registration), the effective net yield will be approximately 8.1% for the building and 5.4% for the area.
Assessment of the investment fair price range (benchmark for a buyer targeting a 7–8% yield):
– For the building: the fair price range for a 7–8% yield is 10,100–11,500 AED/m² (based on typical rental rates from DLD).
– The current market price is 9,234 AED/m²: this level delivers a yield above 8%, so there is no room for an additional discount; on the contrary, apartments in SHERENA RESIDENCE are priced at a level that is attractive for buy‑to‑let investors (yield above the area average).
– For the area: to achieve a 7–8% yield, an investor would need to buy apartments at 9,900–11,300 AED/m². The actual average price in the area is above this range; accordingly, the overall investment appeal of the area is lower than that of SHERENA RESIDENCE.
7. Comparison with the area, liquidity assessment and outlook
SHERENA RESIDENCE occupies a niche with a price discount to the area, but with a comparable rental level. This makes the property particularly interesting for income‑focused investors (the yield is 2–3 p.p. higher than the area average). Liquidity is high both in sales and rentals; market demand is confirmed by the large volume of DLD contracts.
Over a 3–5 year horizon, given the growth rates of both prices and rents in the building, there is potential for stable income as well as possible recapitalisation (price growth towards the area average). Compared to the area, SHERENA RESIDENCE currently offers higher yields while still being cheaper than comparable stock.
Conclusion: SHERENA RESIDENCE is an attractive choice for an investor seeking a balanced combination of yield and stable liquidity. The key driver of interest is the significant discount to the average area price at the same rental rate.
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