Expanding Expat Demand Drives 14% Annual Growth in Abu Dhabi Rental Market
Saturday, 6 December 2025
Abu Dhabi’s rental market recorded strong double-digit growth in Q3 2025 as rising expat demand, healthy absorption rates, and limited new supply boosted rental values across the Emirate. Market experts anticipate continued upward momentum supported by population growth and steady investor activity.
Key Highlights:
Strong Rental Market Performance
- Abu Dhabi apartment rents rose 14.2% year-over-year in Q3 2025 (Cavendish Maxwell).
- Villa rents increased 5.1% annually, with stable performance across most communities.
- ValuStrat noted quarterly rent growth of 2.3% and annual growth of 9.3% overall.
- Apartment rents grew 12.8%, while villa rents rose 5.6% annually.
High Demand from Expat Community
- Strong population growth and an expanding expatriate workforce drove robust rental demand.
- High absorption rates kept vacancy levels low despite new supply entering the market.
- Increasing demand from smaller families and new arrivals supported sustained rental activity.
Upcoming Residential Supply
- Developers expected to deliver 8,000 new units in 2025 and 12,800 in 2026.
- A further 12,400 units projected for 2027 and 21,400 for 2028.
- Experts note that actual handovers may be staggered to support balanced market absorption.
- Approximately 33,000 new homes anticipated over the next five years.
Investor & End-User Interest
- Around 2,700 units (apartments, townhouses, villas) launched for sale in the first nine months of 2025 saw steady demand.
- As of September, 10.3% of the 2025 pipeline was delivered, maintaining a healthy supply-demand balance.
Strong Sales Activity
- Q3 2025 recorded 6,400+ residential transactions, led by apartment sales (5,100 deals).
- Total sales value reached AED 20.5 billion, with AED 16.3 billion from off-plan properties.
- Limited new villa and townhouse launches encouraged buyers to shift toward apartments.
Market Outlook
- Experts expect both sales and rental prices to grow further in the near term.
- Growth rates will vary by location depending on new supply introduction.
