Abu Dhabi Residential Market Posts Second-Strongest Quarter on Record

Abu Dhabi's residential market delivered its second strongest quarter on record in Q1 2026, with transaction volumes in Abu Dhabi City exceeding 7,200, marginally behind the all-time peak of over 7,600 recorded in Q4 2025, according to Savills’ Market in Minutes report. The first quarter of 2026 also accounted for 35% of full-year 2025 transaction volumes, underscoring the depth of demand sustained across the market.

Off-Plan Holds Dominant Position
Off-plan transactions accounted for 81% of all Q1 2026 sales, up from 80% in Q4 2025. Manchester City Yas Residences by Ohana Development generated AED 6 billion in sales within 72 hours, making it one of the standout transactions of the quarter. Other key launches included Tara Park on Al Reem Island, where Modon Properties proceeded mid-March despite prevailing regional uncertainty, and Jumeirah Residences on Al Maryah Island. Key completions included Fay Al Reeman Phase 2 and The Gate Residence in Masdar City. Approximately 20 projects offering around 4,000 units were launched in the quarter, with 80% apartments, up from 3,400 units launched in Q4 2025.

Apartments Drive Transaction Composition
Apartments accounted for 73% of all Q1 2026 transactions, up from 67% across full-year 2025. A record 5,200 apartment sales were recorded, the third consecutive quarter above 4,000 units.

Pricing Trends
Off-plan average rates rose 39% quarter-on-quarter from AED 16,540 per sqm at end-2025 to AED 23,067 in Q1 2026. In the ready market, average rates rose 2.66% from AED 15,087 in Q4 2025 to AED 15,480. Capital values rose across all key districts tracked by Savills for both villas and apartments. Savills notes that headline figures should be read with caution, as March transaction data may reflect deals initiated in January and February, potentially lagging current market conditions.

March Signals a Shift in Tone
Activity in January and February remained strong, carrying forward the momentum of late 2025. March, however, reflected a more measured tone. Regional geopolitical tensions escalating from 28 February led to airspace disruptions, amended school schedules, and increased remote working. Ramadan, Eid Al-Fitr, and an early school spring break added further seasonal weight, with March volumes declining 16% month-on-month.

The month also saw resale off-plan transactions rise from 4% to 15% of total activity, a departure from the market's historically primary-led structure, indicating growing investor activity and reassignment transactions.

Ali Ishaq, Head of Residential Agency Abu Dhabi, Savills Middle East, said, “Abu Dhabi’s residential market has demonstrated remarkable resilience, delivering near-record transaction volumes in Q1 despite a complex backdrop of regional geopolitical developments and seasonal factors. Overall, Q1 2026 accounted for 35% of full-year 2025 transaction volumes, underscoring the sustained depth of demand across the market. What is particularly encouraging is that underlying demand fundamentals remain intact. The off-plan segment continues to attract strong interest, and we are seeing buyers from both within the UAE and internationally remain committed to Abu Dhabi’s long-term growth story. The coming quarters will be important in establishing the market’s direction, but for those with a long-term perspective, the Abu Dhabi story remains a strong one.”

Outlook
Savills describes the near-term as a wait-and-see phase, with transaction activity expected to reflect external conditions with some lag. Longer-term, supply constraints, limited near-term handovers, and continued economic growth are expected to sustain residential demand. Abu Dhabi's broader growth story, underpinned by ADGM's expansion with a mixed-use scheme by Mubadala and Aldar, ongoing development on Saadiyat Island's cultural district, and the anticipated opening of Disneyland Abu Dhabi, is expected to continue driving wealth migration and prime market demand.

Source: Market in Minutes by Savills