5 days ago
- Business
- Time Out Abu Dhabi
Your guide to the rising property prices in Abu Dhabi
House hunting in Abu Dhabi? You might want to start saving a little more aggressively.
The capital's property market has just clocked its strongest capital gains in three years, even though sales activity has taken a tumble. That's according to ValuStrat's latest Q1 2025 report, which shows a market surging in value while grappling with a slowdown in transactions.
Property values rose by 2.1 percent quarter-on-quarter and a healthy 7.2 percent year-on-year, with the ValuStrat Price Index now sitting at 125.6 points. Villas led the charge with a 9.7 percent annual increase, while apartment prices grew by 4.5 percent over the same period.
Villas on Saadiyat Island saw the biggest jump, with prices up by a whopping 21.2 percent year-on-year. Al Raha and Mohammed Bin Zayed City also saw noticeable growth. As for apartments, Al Reef topped the list with a 7.5 percent annual boost, followed by Saadiyat Island and Al Muneera.
The average home in Abu Dhabi is now valued at Dhs10,226 per square metre, with apartments averaging Dhs10,979 and villas at Dhs8,407.
And it's not just prices that are climbing – rents are surging too. Apartment rental rates rose by 11.6 percent annually, while villa rents grew by 6.3 percent.
A typical studio now goes for Dhs63,000 a year, with a one-bedroom hitting Dhs89,000 and a two-bedroom costing Dhs125,000. Larger homes are significantly pricier, with villa rents averaging Dhs245,000 annually.
Despite the appetite for homes, the number of new units coming online remains slim. Only 90 apartments and 189 villas were completed in Q1, representing just two percent of the 2025 pipeline.
Still, major developers aren't staying quiet. Aldar launched Mamsha Gardens on Saadiyat Island, IMKAN announced Naseem Al Jurf in Ghantoot Taraf teamed up with Marriott International to deliver W Residences on Al Maryah Island.
Sales volumes told a different story. Overall transactions fell sharply – down almost 43 percent quarter-on-quarter – with off-plan sales plunging by 79 percent year-on-year. Yet the average home price is on the rise. Ready property prices jumped by nearly 6 percent, with the average ready home now fetching Dhs1,146 per square foot. The average transaction size increased to Dhs2.6 million.
In the commercial sector, Abu Dhabi's office market is thriving. Asking rents climbed more than 30 percent over the year, driven by strong demand and high occupancy in central business districts. Retail is holding its own too, with Yas Mall reporting 97 percent occupancy, an 18 percent jump in footfall a 10 percent rise in tenant sales.
The hospitality industry continues to shine, with average room rates hitting Dhs683 – a rise of 37 percent year-on-year – and occupancy reaching nearly 87 percent in early 2025.
With 5.2 million guests in 2024, Abu Dhabi is firmly on the global tourism radar hotel supply is expected to exceed 50,000 keys by 2030. New entries to watch include the UAE's first Mondrian Hotel in Downtown Abu Dhabi and a new Waldorf Astoria at the former Anantara Eastern Mangroves site.
So whether you're buying, renting, investing or just keeping an eye on trends, the message is loud and clear – Abu Dhabi's property market is booming it's not slowing down anytime soon.
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