Today's Edition
A. SREENIVASA REDDY (ABU DHABI)
Abu Dhabi’s real estate market sustained its upward momentum in the first quarter of 2025, with average apartment rents climbing 10% year-on-year (YoY) and 4% quarter-on-quarter (QoQ), according to the latest market report from real estate consultancy Asteco.
The report noted particularly robust growth in the high-end rental segment, where rates increased between 8% and 12%. The mid-tier market also recorded solid gains, with rents rising between 5% and 8%.
“This widespread positive performance, characterised by increasing rents and high occupancy, underscores the fundamental strength and consistency of demand within Abu Dhabi’s residential sector,” Asteco said in the report.
Despite the rise in rentals, some low-end apartments remain relatively affordable on Abu Dhabi Island. In areas like Al Khalidiyah and Al Bateen, studio apartments are available for Dh25,000 to Dh35,000 annually, while one-bedroom units range from Dh28,000 to Dh45,000.
In Central Abu Dhabi and the Corniche, studios are priced between Dh30,000 and Dh35,000 per year, and one-bedroom apartments can be rented for Dh40,000 to Dh50,000 annually.
Despite the healthy rental gains, supply continues to come online at a steady pace. In Q1 2025 alone, approximately 1,200 new residential units were delivered across developments including Jubail Island, Bloom Living – Cordoba Phase 1, Al Jurf Gardens in Ghantoot, Al Raha Beach and Rawdhat Abu Dhabi.
The total number of new residential handovers for 2025 is expected to reach 5,500 units, concentrated in key investment zones such as Yas Island, Masdar City, Saadiyat Island and Al Reem Island.
According to Asteco data sheet, 700 new apartment units and 500 villa units were completed in Abu Dhabi during the first quarter of 2025. This follows the completion of 2,850 apartments and 2,750 villas in 2024. By the end of 2025, total completions are projected to reach 4,000 apartments and 1,500 villas, reflecting a continued expansion in residential supply across the emirate.
The office sector is also gearing up for fresh supply, with the Quartz Tower on Yas Island set to be delivered in Q2, and other major projects like Shams Tower, The Link, and City Square in the pipeline for late 2025 into 2026.
In terms of sales, the market saw 8,700 residential transactions between March 2024 and March 2025. These included 4,100 off-plan deals and 4,600 sales of completed units, which comprised 3,250 apartments and 1,350 villas and townhouses.
Notably, transactions for completed properties grew by 6% QoQ and surged 42% YoY reflecting strong demand from both investors and end-users.
Sales prices also showed a healthy upward trajectory. Apartment prices rose 4% on QoQ and 7% YoY, with high-demand areas seeing annual gains of over 15%. Villa prices increased by 4% QoQ and 8% YoY, with premium locations such as Saadiyat Island registering annual gains exceeding 15%.
Asteco observed that “well-located villas within prime communities continue to outperform the market average”, underscoring the premium that buyers place on quality and location.
Off-plan launches performed strongly, with high absorption rates within weeks of release. “This reflects sustained buyer confidence in the long-term value and appeal of new developments,” the report noted.
Going forward, Asteco said that the Abu Dhabi real estate market remains “well positioned for continued positive performance in the near to medium term”. Although new supply may moderate the pace of growth in rentals and values, overall market momentum is expected to remain intact, with further upside potential for both capital and rental values.
