Colliers: UAE real estate market enters balanced phase, but demand remains strong

Abu Dhabi: A report by Colliers International, a global professional services and investment management firm, highlighted the continued development of the UAE real estate market in the second quarter of 2026, and its transition towards a more balanced phase, following an extended period of exceptional growth, supported by the market's established fundamentals, continued investments, and economic diversification initiatives. The report provided an analysis of the most prominent trends in the real estate markets of Abu Dhabi, Dubai, the Northern Emirates, and Al Ain, confirming the emergence of the office sector in Dubai as one of the most prominent beneficiaries, based on strong demand from companies to occupy office spaces, and the continued activity of development projects in Dubai throughout the second quarter. Dubai real estate Dubai’s development projects remained active throughout the second quarter of 2026, with the delivery of approximately 11,650 residential units, including 9,200 apartments and 2,450 villas. An additional 56,600 residential units are expected to be completed by the end of the year, and major investments in infrastructure projects continue across Dubai. After several years of exceptional growth, Dubai’s rental market showed signs of moderation during the second quarter of 2026, with average apartment rents declining by 4% and villa rents falling by 2% on a quarterly basis. Colliers noted in its report, the launch of the “Affordable Leasing” initiative by the Dubai Land Department, at a time when the sales market in Dubai continued its strong performance, driven by strong demand for first-class projects under development, which contributed to supporting price growth in a number of sub-markets. The report indicated that the office sector emerged as one of the most prominent beneficiaries, as the strong demand for first-class office projects offered off-plan, supported continued price growth in many sub-markets, based on strong demand from companies to occupy office spaces. Abu Dhabi real estate According to Colliers’ report, the Abu Dhabi real estate market showed signs of moderate performance during the second quarter of 2026, following an extended period of exceptional growth, noting the delivery of approximately 2,200 residential units within a number of existing and emerging residential communities. Colliers expected the delivery of approximately 3,200 additional units during the remainder of 2026. Colliers stated that the residential rental market in Abu Dhabi entered a more stable phase during the second quarter, as average apartment rents decreased by 2% on a quarterly basis, while villa rents declined by 3%. It added that despite this quarterly adjustment, rental performance remained positive on an annual basis, with apartment rents rising by 7% compared to the second quarter of 2025, while villa rents increased by 5%. In turn, the residential real estate sales market entered a more balanced phase during the second quarter of 2026, after a period of exceptional growth, as the average selling price of apartments declined by 3% on a quarterly basis, while the average price of villas decreased by 1%. Despite this quarterly correction, prices maintained strong annual growth, with apartment selling prices rising by 19% and villa prices by 10%. For its part, residential transaction volumes moderated during the second quarter, reached about 7,200 transactions, a decrease of 8% compared to the previous quarter. On the other hand, it recorded a growth of 83% on an annual basis. In the office market, strong demand from companies, particularly those wishing to establish a presence within Abu Dhabi Global Market on Al Maryah Island, continued to support the sector's performance during the second quarter. Sharjah real estate Colliers noted that the launch of new projects in Sharjah witnessed a remarkable acceleration, with the announcement of approximately 4,600 residential units during the second quarter of 2026. Meanwhile, the pace of residential unit completion in the Northern Emirates is trending towards moderation, with the expected delivery of approximately 7,450 units during 2026. Sharjah accounts for the largest share of these with 5,450 units, followed by Ras Al Khaimah with approximately 1,400 units, and then Ajman with approximately 600 units. Average apartment rents in the Northern Emirates decreased by approximately 2% during the second quarter of 2026, while Sharjah recorded a decline of approximately 4%. In contrast, the markets of Ajman, Fujairah, and Umm Al Quwain showed good levels of resilience, supported by continued demand related to affordability. In the sales market, average apartment prices in Sharjah and Ras Al Khaimah decreased by 3% and 2% on a quarterly basis, respectively. Apartment and villa rents rise in Al Ain The real estate market in Al Ain remained stable during the second quarter of 2026, with rental rates for residential units, offices and re