Abu Dhabi freezes rents across residential, commercial, and industrial properties in a move that could help increase long-term investor appeal

Abu Dhabi has put a blanket freeze on rent increases across all residential, commercial, and industrial properties — locking both renewals and new leases on previously occupied units at existing prices until further notice, the Abu Dhabi Real Estate Centre (ADREC) said yesterday in a post on X.

The move marks a significant departure from the emirates’ baseline framework, which allows landlords to raise rents by up to 5% annually if tenants are notified at least two months before renewal, Khaleej Times reports.

AND- New tenancies were exempt. The 5% cap only applied to renewals — when a unit was vacated and re-let to a new tenant, landlords could set the rent at whatever the market would bear. That loophole is why rents on new contracts had been racing far ahead of what sitting tenants pay, and why headline figures like 15-20% annual increases were possible in a market nominally protected by a 5% rule.

This freeze closes that gap. Under the new measure, any new tenancy contract on a previously rented unit must also be offered at the same price as the preceding contract — effectively extending the 0% increase rule to incoming tenants as well as renewals. For the first time, Abu Dhabi landlords cannot use vacancy as a mechanism to reset to market rates.

The move lands as the UAE property market navigates a sharply more cautious climate. The US-Iran war has somewhat slowed down activity in the property market over the past few months, with analysts telling us many investors and buyers are “pausing” to take stock — though not completely dismissing the market, given strong fundamentals and demand.

Before that, Abu Dhabi landlords were enjoying double-digit rental growth for several quarters on end. Apartment rents were up 15% y-o-y in 1Q 2026, with some mid-end developments posting increases above 20%, while villa rents rose 6% annually, according to Colliers’ UAE real estate report (pdf). Office rents across prime business districts also climbed between 8% and 20% y-o-y as occupancy levels stayed above 95%.

Positive impact expected?

The move is “one of the most significant real estate regulatory interventions in recent years,” Andrew Laver, director of commercial valuation and head of Abu Dhabi at Cavendish Maxwell, tells EnterpriseAM. “The decision appears to reflect a broader, strategic response aimed at preserving long-term market stability,” he says, explaining that it’s unlikely it was triggered by a single event.

Given the strong growth in the emirate’s property market over the past two years, the freeze is likely a “proactive measure to stabilize momentum and reinforce the emirate’s economic resilience,” he explains. “By intervening at this stage, authorities are effectively ensuring that growth remains sustainable and does not undermine affordability or demand fundamentals.”

The timing is also meaningful: It introduces greater certainty for tenants at a time of heightened geopolitical and economic uncertainty, particularly as rent remains one of the highest costs for both households and businesses, he adds. While the freeze may temporarily limit landlords’ ability to grow income, he says it could also encourage stronger tenant retention and provide investors with clearer visibility on near-term cashflows and income profiles. “It reinforces confidence that the sector is being actively managed, with safeguards in place to protect both occupiers and investors,” he adds.

Long-term, the move will “enhance Abu Dhabi’s appeal as a long-term destination for residents, businesses, and capital,” he says.

We have a (recent) precedent

Neighboring Riyadh implemented a rent freeze on both new and existing contracts last year in a bid to provide stability in a market where apartment rents had been rising by 30-40% over the past 2-3 years.

At the time, Knight Frank’s Faisal Durrani said the rent freeze strengthens the market by shielding it from speculative “flippers”. High organic demand from a young population provides long-term investment prospects that outweigh short-term yield limitations, he said at the time.