Abu Dhabi’s residential property market is set to witness a strong supply of new units between 2026 and 2028, which could slow the pace of price and rental increases in the capital.
According to Cavendish Maxwell’s latest report, sales prices and rental rates continued to grow in the first six months of the year, with apartment prices up 16.4 per cent and villa prices more than 10 per cent compared to H1 2025. Apartment rents rose 9.4 per cent, with villa rents up nearly 4 per cent.
The temporary rent freeze, announced on June 2, should limit further rental hikes in the near term, the company added.
Abu Dhabi’s residential stock stood at approximately 323,600 units at the end of H1 2026, with approximately 5,700 units completed during the year to date. A further 10,500 units are scheduled for delivery by year-end, bringing projected total stock to around 334,000 units.
Looking further ahead, the pipeline is expected to accelerate considerably, with approximately 17,300 units projected for delivery in 2027 and a further 26,000 units in 2028, taking total residential stock to an estimated 372,000 units by the end of 2028.
“While actual deliveries may fall short of scheduled completions due to construction delays and project deferrals, the overall volume of incoming supply remains considerable. The key consideration for the medium term is therefore not simply the scale of planned supply, but whether underlying demand can absorb it at a pace that supports an orderly market. If supply additions begin to outpace demand growth, greater competition between new and existing stock could place some pressure on residential price and rental growth.
“Regional geopolitical uncertainty adds a further layer of complexity, particularly for projects at earlier stages of development that may be more exposed to changes in construction costs and procurement lead times, potentially resulting in delays or deferrals that alter the timing of future supply,” the global real estate consultancy said.
Andrew Laver, Director, Cavendish Maxwell Abu Dhabi, said the capital’s residential market started the second half of the year with strong momentum.
“While all the factors supporting demand remain in place, the timing of new supply, which includes more than 53,000 units between now and the end of 2028, along with developer launch activity and broader economic conditions are likely to have a greater influence on transactions and price performance. The key consideration is whether demand can continue to absorb the planned supply pipeline,” he said.
“Although the regional geopolitical environment remains the main downside risk, Abu Dhabi’s strong fiscal position and substantial external buffers help absorb these pressures,” Laver added.
All major Abu Dhabi districts saw double-digit price increases. Apartments were up 16.4 per cent on average, with Yas Island recording the strongest increase at more than 18 per cent, followed by Al Reem Island (17.3 per cent) and Al Raha Beach (17.2 per cent).
The highest increases for villas were at Yas Island at 14.2 per cent, followed by Saadiyat Island at 10.7 per cent, both above the average rise of 10.1 per cent.
On the rental front, apartments at Yas Island commanded the largest increase at nearly 18 per cent, with Al Reem Island at just over 13 per cent and Al Reef at 12 per cent. The average rent rise for apartments was 9.4 per cent. Al Reef led the villa rent increase chart at 5.5 per cent.
Source: Khaleej Times