A survey claims that high-net-worth people (HNWIs) from all over the world are prepared to spend $408.3 million in Abu Dhabi and an extra $388.5 million in Ras Al Khaimah on residential real estate.

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As to the second annual Destination Dubai research by global property consultancy Knight Frank, HNWIs are showing a moderate interest in purchasing real estate in the UAE capital, with only 23 percent indicating a desire to do so. As one’s personal net worth rises, this pattern swiftly reverses. In fact, only 14% of people with a net worth between $2 and $5 million are interested in buying real estate in Abu Dhabi, but 57% of people with a net worth above $15 million wish to purchase residential real estate in the capital of the United Arab Emirates.

Additionally, Knight Frank emphasizes the effectiveness of the “Visit Abu Dhabi” campaign, noting that 67% of HNWIs worldwide with a net worth of over $20 million and 50% of expat HNWIs based in the GCC say that the department of culture and tourism in Abu Dhabi has positively influenced them to travel to the city.

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The movement of domestic buyers from renting to ownership has been greatly aided by the relatively constant residential values in Abu Dhabi over the past four years, according to Shehzad Jamal, Partner, Strategy & Consultancy, MEA.

Additionally, at about Dh1,000 per square foot, residences in Abu Dhabi are still roughly one-third less expensive than those in Dubai, which increases the allure of home ownership in the area for local purchasers. The emirate is currently recording rising deal volumes as a result of the increased activity of international purchasers.

Abu Dhabi saw a record 15,653 real estate transactions in 2023 (up 73.7 percent from 2022), with a total value of Dh87.1 billion across all sectors—up from Dh61 billion in 2022. Interestingly, 1,098 non-resident investors were invited into the capital in 2023—a 175% rise from 2022.

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“While 40% of HNWIs plan to purchase in Abu Dhabi purely for investment reasons, 8% are keen on a primary residence in the city, and a further 15% would consider buying a second home in the UAE capital,” stated Faisal Durrani, Partner – Head of Research, MENA. The city, which has frequently lagged behind Dubai in this regard, is experiencing a watershed moment.

Additionally, the March sale of a three-bedroom penthouse marketed under the Nobu name marked a noteworthy turning point for the residential market in Abu Dhabi. This is due to the fact that it is the most expensive property ever sold in the capital, both in terms of total price and price per square meter, as well as the fact that it announces Abu Dhabi’s becoming a capital hub for the world. In fact, this is demonstrated by the fact that, last year, the percentage of Aldar’s total property sales that went to foreign customers who did not live in the UAE increased from just 3% to 28%.

Top attractions in the capital

According to Knight Frank, the most sought-after destination for high net worth individuals (HNWIs) to acquire real estate is Abu Dhabi island (21%) despite not being classified as an investment zone for foreign purchasers. Saadiyat Island (16%), home of the Guggenheim and Louvre museums as well as the November Formula One Grand Prix, has been identified as the second most probable neighborhood to be the target of a real estate purchase.

“Saadiyat Island villas have done well over the last 12 months, with prices rising by 10% over that time,” Jamal continued. But for more than three years, prices have remained stuck at a glass ceiling of about Dh1,500 per square foot, which may be one of the reasons why purchasers are drawn to this area. In comparison, the cost of a villa at Dubai’s Palm Jumeirah is currently about Dh7,000 per square foot.

Saadiyat Island (32%), Maryah Island (24%), and Saadiyat Island (33%), are the top three locations in Abu Dhabi chosen by expat HNWIs residing in the GCC.