Abu Dhabi Real Estate Update Q4 2024: Affordable vs. Luxury Housing Trends

2024 has been a dynamic year for Abu Dhabi’s real estate. As the UAE market continues to evolve, the demand for residential housing and offices in Abu Dhabi has also grown. A recent report reveals a significant surge in transaction volumes across the affordable and luxury sectors.

Is Abu Dhabi still a seller’s market? What should investors take away from last year’s performance? Are off-plan properties in demand? Here’s a look at Abu Dhabi’s real estate update for Q4 2024.

Al Reem Island is a top choice for investors in 2024

Interest in high-end properties in Abu Dhabi grew significantly last year. That doesn’t come as a surprise. The innovative city, with its towering skyscrapers and luxurious lifestyle, is considered a paradise for those seeking a premium way of life. 

However, while Abu Dhabi is often marketed as a luxury market, the city has plenty of affordable housing options.   It remains an inclusive and accessible place to live, even for those who don’t want to break the bank on real estate.

What were the trends for affordable Abu Dhabi housing in Q4 of 2024? According to reports, Al Reem Island was the top choice for buyers; however, significant interest was also shown in Al Reef and Al Ghadeer properties. Moreover, these areas' average price per square foot increased between 2 and 20 per cent. Most notably, Al Ghadeer experienced the highest growth (19.8 per cent), while Baniyas saw a 1.92 per cent decline. This highlights a valuable opportunity for investing in a tranquil, family-friendly community.

Regarding villas in the more affordable segment, most buyers purchased a property in Al Reef, Abu Dhabi Gate, and Khalifa City. According to reports, the prices for villas in these areas also grew (by 6 to 18 per cent). However, some communities, like Khalifa City and Abu Dhabi Gate, experienced a decline (although relatively little) of less than 2 per cent.

Demand for luxury housing in Abu Dhabi

When hearing "Abu Dhabi”, most people envision its stunning islands, sprawling mega-malls, and futuristic skyline. The city is a place of grandeur and opulence, so it’s a popular choice for investors looking for luxury housing. In the last quarter of 2024, Al Raha Beach was the main pick for luxury apartments, with Saadiyat Island and Yas Island following closely. 

As the demand for premium properties grew, prices increased, too. In fact, apartments in Saadiyat Island saw a price increase of 32.4 per cent.

As for luxury villas, most buyers searched for houses on Yas Island, which is known for its beautiful waterfront properties and family-friendly community.

What about the highest ROI?

Whether looking for a quick return or long-term cash flow and appreciation, return on investment (ROI) is a valuable tool to gauge whether a property investment is worthwhile. As Q4 updates for 2024 show, Al Reef was the most profitable option on the market, offering an ROI for apartments at 8.64 per cent. Not far from these numbers, you’ll find Al Ghadeer at 8.41 per cent.

In the luxury market, the best ROI was seen for Yas Island (7.07 per cent), Al Raha Beach (6.09 per cent), Hydra Village (8.09 per cent), and Al Ghadeer (6.53 per cent).

Strong interest in off-plan properties

2024 has been a record-breaking year for real estate transactions in Dubai. Much of this can be attributed to the surge in off-plan sales (60.5 per cent of all transactions). 

Although Abu Dhabi’s off-plan market is more modest than Dubai’s, it still performed strongly in the last quarter of 2024, with 5,385 transactions (55.5 per cent of all deals made).

Impressively, the total value of off-plan sales in Abu Dhabi was Dhs16.34bn, roughly 63.8 per cent of the residential sales value.

Although the off-plan market continues to perform well, there is a growing shift to ready properties. Some experts expect the trend to continue in 2025.

Which areas were popular for off-plan properties? Most buyers preferred Al Reem Island, Al Shamkha, Masdar City, Yas Island, and Saadiyat Island.

Is Abu Dhabi a seller’s market?

As we discussed, the last quarter of 2024 indicated an upward trend in property prices. In Abu Dhabi, both affordable and luxury property segments saw price increases, which reflects strong buyer demand relative to the available housing. This and limited inventory (approximately 4,000 villas and townhouses joined the market in the fourth quarter) suggest that the market favoured sellers.

Tips for investing in Abu Dhabi’s real estate in 2024

Considering all of this, you may wonder – what’s the best investment strategy in Abu Dhabi’s real estate? Buying a property in a seller’s market can sometimes feel like a race against time. In a scenario like this, buyers need to be well-prepared. Here are two tips that should help you navigate these competitive waters.

Figure out your priorities

When entering a seller’s market, knowing exactly what and how you want it is critical. You’ll likely have to compromise on some things in a market like this. If you clearly understand what you can be flexible on, it will give you a far greater position.

Offer a competitive price

Making a lowball offer for properties in Abu Dhabi can easily result in rejection. If you have the option, it may be wise to bid slightly above the asking price to stand out. However, before you take this step, it’s best to consult with a local real estate agent to make sure you’re not overpaying.

Final thoughts: Abu Dhabi real estate update Q4 2024

This past year has been anything but boring for the real estate market in Abu Dhabi. The city remains one of the world’s most attractive investment destinations thanks to its stable economy and high quality of living. Reports show that in 2024, the total number of transactions in Abu Dhabi reached a record high of 14,662 units. As new developers have entered the market, experts predict the demand for housing in the thriving city will grow even more.

If you’re considering investing in Abu Dhabi’s real estate, now is the time to do it, as the competitive market is expected to grow even more fierce in 2025. Our team at Oia Properties will gladly answer any questions you have. Reach out to us here to discuss details and find the perfect Abu Dhabi property for your needs.

FAQ

Is it a good time to buy property in Abu Dhabi?

The Abu Dhabi real estate market has shown positive growth in 2024. This is due to many factors, including friendlier investor policies, visa initiatives, and a stable economy. Although prices are steadily climbing, Abu Dhabi offers some of the highest rental yields in the region (averaging 6-8%) with relatively low upfront costs. So, the short answer is, yes, it’s a good time to buy property in Abu Dhabi.

Is it better to invest in Dubai or Abu Dhabi?

Both cities are a great choice for investors. However, Abu Dhabi offers more long-term growth potential, which is why it will be a better fit for cautious investors, while Dubai’s dynamic market will be excellent for those seeking quick returns.

Is the property cheaper in Abu Dhabi or Dubai?

Generally, Abu Dhabi offers housing at more affordable prices.