Market Overview

Abu Dhabi's real estate market has demonstrated remarkable resilience and growth through 2025, with residential prices advancing approximately 15.5% year-on-year and transaction values reaching record levels. The market is characterized by balanced demand from end-users, regional investors, and institutional capital, with measured supply additions maintaining price stability.

• Economic Diversification: Non-oil GDP growth of 8.7% in 2024 continues to drive real estate demand.
• Population Growth: Abu Dhabi's population reached 3.5 million in 2025, a 4.2% increase from 2024.
• Government Initiatives: Golden Visa program and business-friendly policies continue to attract foreign investment.
• Infrastructure Development: Major projects like Jubail Island and Reem Hills sustain market momentum.

Sales & Prices

Abu Dhabi's residential market shows sustained growth across all segments, with prime areas leading the appreciation. Off-plan sales continue to dominate transaction volumes, indicating strong future market confidence.

• Average Price Growth: +15.5% YoY (Q3 2025)
• Apartment prices: +16.2% YoY (Q3 2025)
• Villa prices: +14.3% YoY (Q3 2025)
• Off-plan sales: 68% of total transactions (up from 55% in 2024)

Prime areas like Saadiyat Island and Yas Island continue to outperform the market with 20%+ annual growth.

Residential Price Index

Rents & Yields

Rental market remains robust with average growth of 9.8% YoY across prime residential areas. Limited quality supply in preferred locations maintains landlord pricing power, particularly in family-oriented communities.

• Prime Areas: Saadiyat Island (+12.5%), Yas Island (+11.8%), Al Reem Island (+10.2%)
• Gross Yields: Range from 5.2% in prime areas to 7.3% in value segments
• Vacancy Rates: Below 5% in prime residential clusters
• Renewal Premiums: Average 8-12% for prime properties

Rental Yields by Segment

Supply Pipeline

New supply remains measured and aligned with demand fundamentals. 2025 delivery expectations suggest continued market balance, supporting price and rent trajectories.

• 2024 Completions: ~3,200 apartments + ~2,850 villas (citywide)
• H1 2025 Completions: ~1,850 apartments + ~950 villas
• 2025 Forecast: ~4,500 apartments + ~2,200 villas
• Absorption Rate: 87% for newly delivered units in prime locations

Major upcoming projects include Jubail Island (phase 1), Reem Hills, and Bloom Living (phase 2).

Annual Completions

Transactions & Mortgages

Market liquidity reached record levels in H1 2025 with total transaction value of AED 53.2 billion. Strong investor confidence and end-user activity across all segments contributed to this performance.

• Total Transactions: AED 53.2 billion (H1 2025)
• Sales Value: AED 34.1 billion (64% of total)
• Mortgage Value: AED 19.1 billion (36% of total)
• Off-plan Share: 68% of sales transactions
• International Buyers: 42% of transactions (up from 35% in 2024)

Transaction Values

Offices & Industrial

Prime office vacancy remains below 3% with rents commanding a ~73% premium to Grade-A space. Industrial/warehousing sector continues its strong performance with rents surging ~22.4% YoY in Q2 2025.

• Prime Office Rents: AED 1,950-2,250 psm/year
• Grade-A Office Rents: AED 1,100-1,350 psm/year
• Industrial Rents: AED 350-550 psm/year (up 22.4% YoY)
• Office Vacancy: 2.8% for prime, 8.5% for secondary
• Industrial Vacancy: Below 2% in strategic locations

Office Rent Premium

Risks & Watch-items

• Global Economic Conditions: Potential impact of international economic slowdown on investor sentiment
• Interest Rate Environment: Further rate increases could affect mortgage affordability
• Supply Concentration: Risk of oversupply in specific segments or locations
• Regulatory Changes: Potential impact of new real estate regulations or visa policies
• Construction Costs: Continued inflation in building materials and labor costs

Recommendations

• Residential: Focus on prime locations with limited supply; consider off-plan in established communities
• Commercial: Secure prime office space with long-term leases; consider logistics assets
• Timing: Current market conditions favor medium to long-term investment horizon
• Due Diligence: Thorough assessment of developer track record and project fundamentals