Abu Dhabi is seeing a significant shift in demand towards villas, due to a limited supply of apartments and increased interest from high-net-worth individuals and professionals. Industry executives say villas have seen strong growth in recent years. Faisal Durrani, head of research at Knight Frank’s Mena, said villas have seen a 35% price increase over the past five years, and now account for around 37% of the total supply in Abu Dhabi. They continue to outperform apartments in value, due to the limited supply of villas on the market. The average price per square foot for a villa is around AED 1,100, which is significantly lower than similar listings in Dubai. This price differential makes the capital’s market more attractive to buyers, especially those looking for a comfortable family lifestyle.
According to the latest figures from Knight Frank, villa prices in the second quarter rose 3.4% year-on-year to AED 1,103 per square foot. Compared to the beginning of 2020, this is an increase of 42.3%. The highest annual price increase was recorded on Al Saadiyat Island (+28%), followed by Yas Island (+22%), also known for its luxury resorts. The cumulative increase in the average cost of housing in the UAE capital from April to June 2025 was 6.4% per quarter and 17.3% year-on-year, reaching AED 1,230 per square foot. At the same time, apartments showed an even more noticeable quarterly price increase (+6.8%) and annual growth (+17.3%). The most promising locations were Al Raha Beach (+11%) and Al Saadiyat Island (+10%), which are symbols of elite living by the sea. Knight Frank’s Shehzad Jamal noted that around 63% of high net worth individuals are considering Abu Dhabi property for personal use, whether as a primary residence, holiday home or retirement home. The remaining 37% see it as an investment opportunity.
The continued rise in prices makes the capital attractive to those looking to diversify their assets after investing in Dubai. Meanwhile, supply remains limited, with residential property transactions estimated at AED9 billion in the first half of 2025, down 36% year-on-year. The city faces a shortage of new housing, with only 890 new units completed in the year, while more than 33,000 units are under construction and scheduled for delivery by 2029. Most of the upcoming projects (62%) are apartments.
Yas Island, one of the key hubs for new development, has more than 8,000 units under construction, thanks to its many resorts and theme parks. Al Shamkha is also receiving significant attention with plans to build around 3,000 residential units. In addition, Aldar’s premium branded residences, developed in partnership with Mandarin Oriental and Nobu, are strengthening the property market on Saadiyat Island. Knight Frank’s Will MacKintosh highlights the growing interest of foreign investors in Abu Dhabi due to its quality living and business environment.
The company predicts that strong demand for off-plan properties will continue, with around seven per cent of buyers already showing interest in off-plan properties. This suggests that many are looking to purchase off-plan properties for both permanent residence and holiday homes.
According to the latest figures from Knight Frank, villa prices in the second quarter rose 3.4% year-on-year to AED 1,103 per square foot. Compared to the beginning of 2020, this is an increase of 42.3%. The highest annual price increase was recorded on Al Saadiyat Island (+28%), followed by Yas Island (+22%), also known for its luxury resorts. The cumulative increase in the average cost of housing in the UAE capital from April to June 2025 was 6.4% per quarter and 17.3% year-on-year, reaching AED 1,230 per square foot. At the same time, apartments showed an even more noticeable quarterly price increase (+6.8%) and annual growth (+17.3%). The most promising locations were Al Raha Beach (+11%) and Al Saadiyat Island (+10%), which are symbols of elite living by the sea. Knight Frank’s Shehzad Jamal noted that around 63% of high net worth individuals are considering Abu Dhabi property for personal use, whether as a primary residence, holiday home or retirement home. The remaining 37% see it as an investment opportunity.
The continued rise in prices makes the capital attractive to those looking to diversify their assets after investing in Dubai. Meanwhile, supply remains limited, with residential property transactions estimated at AED9 billion in the first half of 2025, down 36% year-on-year. The city faces a shortage of new housing, with only 890 new units completed in the year, while more than 33,000 units are under construction and scheduled for delivery by 2029. Most of the upcoming projects (62%) are apartments.
Yas Island, one of the key hubs for new development, has more than 8,000 units under construction, thanks to its many resorts and theme parks. Al Shamkha is also receiving significant attention with plans to build around 3,000 residential units. In addition, Aldar’s premium branded residences, developed in partnership with Mandarin Oriental and Nobu, are strengthening the property market on Saadiyat Island. Knight Frank’s Will MacKintosh highlights the growing interest of foreign investors in Abu Dhabi due to its quality living and business environment.
The company predicts that strong demand for off-plan properties will continue, with around seven per cent of buyers already showing interest in off-plan properties. This suggests that many are looking to purchase off-plan properties for both permanent residence and holiday homes.