Abu Dhabi’s property market kicked off 2025 with its strongest capital gains in three years, with broad-based growth across residential, commercial, hospitality, and retail segments, according to ValuStrat’s latest report (pdf).

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Residential prices and rents continued to rise: The ValuStrat Price Index for Abu Dhabi’s residential market rose 2.1% q-o-q and 7.2% y-o-y — the fastest annual increase since 2022. Villas led the gains, with prices up 2.7% q-o-q and 9.7% y-o-y, while apartment prices climbed 1.5% q-o-q and 4.5% y-o-y.

Apartment rents outpaced villas, surging 11.6% y-o-y and 3.4% q-o-q. Villa rents rose 6.3% y-o-y and remained flat q-o-q. Average gross yields across the residential market stood at 7.8%, with occupancy estimated at 88.1%.

Sales activity was mixed amid tight supply: Off-plan sales volumes dropped 79.2% y-o-y and 57.7% q-o-q as new launches slowed. Meanwhile, just 2% of the 2025 residential pipeline was delivered in 1Q. Still, the average ticket size for off-plan units jumped 19.2% y-o-y to AED 3.6 mn.

Meanwhile, ready home sales climbed 13.6% y-o-y but fell 33.6% q-o-q. The average ready home price increased 5.8% y-o-y, while average ticket size rose 23.8% y-o-y to AED 2.6 mn.

REMEMBER- More supply is on the horizon: Cushman & Wakefield expects around 8.5k new residential units to be delivered this year, particularly in Yas Island, Reem Island, Saadiyat Island, and Al Maryah Island. Off-plan launches on Hudayriat Island and Masdar City are also expected to boost unit handovers through to 2027.

Commercial, hospitality, and retail segments remained resilient:

  • Office rents in prime business districts rose 8.0% q-o-q and 31.8% y-o-y, with occupancy rates coming in at 90.5%;
  • Hotel occupancy stood at 86.9% as of February, driving a 38.7% y-o-y increase in revenue per available room;
  • Retail performance remained strong with Yas Mall’s 97% occupancy rate outperforming the 90% market average.

Looking ahead: ValuStrat expects further price and rent growth this year, underpinned by stable mortgage activity and strong end-user demand. New project launches in Saadiyat Island, Ghantoot, and Zayed City point to ongoing developer confidence. The rollout of Abu Dhabi’s first rental index — with quarterly updates planned — is also set to improve market transparency and price benchmarking.

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