The UAE real estate witnessed sustained market growth owing to strong demand and proactive government initiatives, said leading industry expert Colliers.
The Abu Dhabi market is well-positioned for continued growth with increased developer activity, while Dubai is experiencing unprecedented growth with multiple developments in progress, stated Colliers in its Q2 2025 real estate report which provides key insights into market activity, supply, demand, and price movements across Abu Dhabi, Dubai, Al Ain and Northern Emirates.
On Abu Dhabi residential and office market, Colliers said the emirate's real estate market is demonstrating its most robust performance since 2009.
In Q2, approximately 3,250 residential units were delivered, with nearly 2,150 additional residential units anticipated to be handed over by year-end, primarily in Investment Zones such as Yas Island, Masdar City, Saadiyat Island, and Jubail Island.
New project launches, including Brabus Island by Reportage and Bulgari Resort and Mansions, underscore positive market sentiment. Moreover, Abu Dhabi’s National Housing has approved 14 new local housing projects, expecting to contribute 26,000 residential units over the next 5-10 years, stated the report.
The residential rental market in Abu Dhabi demonstrated strong growth in Q2 2025, with average apartment rental rates rising 6% quarterly and 13% annually.
Prime and high-end markets
Mid and low-end sectors saw annual gains ranging from 15 to 25%, while prime and high-end markets increased 5-10% quarterly and 5-18% annually. Villa rental rates also saw positive momentum across all areas and quality tiers, with 3% quarterly and 4-15% annual growth, it stated.
Residential sales transactions in Abu Dhabi continued their upward trajectory in Q2 2025, primarily driven by the ready/completed property segment with over 2,000 sales deals, a 46% increase from Q1 2025.
Ready sales constituted 70% of transactions, with a 43% quarter-on-quarter and 44% year-on-year increase, indicating sustained demand from end-users and investors.
Off-plan transactions rose 53% compared to Q1 2025. Apartment sales prices increased by 8% quarter-on-quarter and over 25% annually, with high-end communities seeing over 35% annual growth. Villa sales mirrored this trend, with 8% quarterly and 25% annual increases.
On Dubai market, Colliers said in Q2, the emirate saw a substantial influx of new residential supply, with approximately 12,500 units delivered.
While apartments formed the majority with 70%, villa deliveries surged by over 40%, reaching 3,900 units. New project launches continued unabated, with an estimated 60,000 units announced across more than 200 developments.
Colliers noted unprecedented development activity, with developers managing multiple projects simultaneously, and anticipating continued innovation.
The Dubai rental market in Q2 showed signs of a maturing environment. Average rental growth was 1% quarter-on-quarter for apartments and 2% for villas, driven by the robust luxury segment and increased availability of high-end units in areas such as Jumeirah Village Circle (JVC) and Arjan.
New lease volumes saw marginal year-on-year growth (1% for apartments, 4% for villas), partly due to internal relocations. More tenants are transitioning to homeownership, leading to a moderation in rental renewals, said the statement.
The Dubai sales market continued its upward trend, with average apartment and villa sales prices increasing by 3%. Off-plan sales are leading this surge due to a high number of new project launches.
The Dubai government launched the First-Time Home Buyer Programme in July 2025 to encourage homeownership, offering preferential pricing and tailored mortgage solutions.
This initiative promotes homeownership for eligible UAE residents (Emirati and expat) by offering preferential pricing (up to 10% off) and tailored mortgages on new off-plan units (up to AED 5M), plus DLD fee installment options. This marks a maturing market shift towards end-users, with major developers and banks participating.
The office sector also gained traction with new announcements including Lumena by Omniyat and Uptown Dubai Phase 2.
Al Ain and Northern Emirates Market
According to the report, new residential project launches gained momentum in Q2 with the announcement of approximately 8,000 units across the Northern Emirates.
The rental market recorded robust growth, with average apartment rental rates increasing by 3% quarter-on-quarter and 12% year-on-year. Ras Al Khaimah led this surge with a 5% quarterly rise, followed by Sharjah at 4% and Ajman at 2%.
The sales market also saw a strong performance with Ras Al Khaimah recording a significant 4% quarterly and 18% annual increase in average apartment sales prices, whilst Sharjah’s sales growth stood at 3% quarter-on- quarter and 11% year-on-year, said Colliers in its report.
The Al Ain real estate market demonstrated continued stability and robust fundamentals in Q2 2025, with residential rental rates holding steady and favorable occupancy.
Apartment rentals saw significant year-on-year growth (up to 10%), while villa rents grew 4%. The office and retail sectors also showed stable growth, with new retail community centers set to expand offerings by late 2025/mid-2026, it added.-TradeArabia News Service