The Upsides · Market
As of 2 June 2026, Abu Dhabi implemented a temporary 0% rent increase cap, replacing the previous 5% annual limit. The cap applies to residential, commercial, and industrial property and remains in force until further notice. This page explains what changed and sets out current average asking rents across the emirate.
Under the previous framework, landlords could raise rents by up to 5% per year on renewal. The new temporary cap sets that limit at 0%, meaning rents on existing tenancies are held at renewal until the measure is lifted. The cap covers residential, commercial, and industrial leases. No end date has been announced. New leases signed at market rates are a separate matter from renewal increases on existing contracts; tenants renewing an existing tenancy are the group directly affected.
| Apartment type | Average annual asking rent | Annual change |
|---|---|---|
| Studio | AED 74,000 | +13.8% |
| One bedroom | AED 98,000 | +7.7% |
| Two bedroom | AED 135,000 | +5.5% |
| Three bedroom | AED 183,000 | 0.0% |
| Villa type | Average annual asking rent | Annual change |
|---|---|---|
| Three bedroom | AED 197,000 | +6.5% |
| Four bedroom | AED 267,000 | +7.2% |
| Five bedroom | AED 315,000 | +0.6% |
Citywide, the average annual residential asking rent stood at AED 163,700 in Q2 2026, with apartment asking rents in Abu Dhabi City averaging AED 122,500 and citywide villa rents averaging AED 260,000. Rental values overall rose 4.7% year on year but were flat quarter on quarter, consistent with the cap taking effect mid-quarter. Studios recorded the strongest annual growth at 13.8%, a signal of demand pressure at the affordable end of the market.
For buy-to-let investors, a 0% renewal cap limits rental growth on tenanted units but does nothing to cap capital appreciation, which ran at 17.8% year on year across Abu Dhabi in the same quarter. It also tends to reduce tenant churn, supporting occupancy. For off-plan buyers, units handed over and leased for the first time enter the market at prevailing rates, which is one reason new supply in high-demand locations such as Saadiyat Island and Yas Island continues to attract investor interest despite the cap.
Questions
Yes. A temporary 0% rent increase cap took effect on 2 June 2026, replacing the previous 5% annual limit, covering residential, commercial, and industrial property until further notice.
Under the temporary cap, rent increases on renewal of existing tenancies are limited to 0% while the measure remains in force.
The average annual residential asking rent was AED 163,700 in Q2 2026. Apartments in Abu Dhabi City averaged AED 122,500 per year and villas AED 260,000 citywide.
It limits renewal-rent growth on existing tenancies but not capital appreciation, which stood at 17.8% year on year in Q2 2026, and first-time leases on newly handed-over units are set at market rates.
Market data: ValuStrat Abu Dhabi Real Estate Review, Q2 2026.
Hot launch
Aldar Properties launched its landmark waterfront master plan on Saadiyat Island on 22 July 2026. Priority registration is open ahead of first residential sales expected in H2 2026. Its first villa release, Talay, is now revealed.
Hot launch · Saadiyat Island · July 2026
Beaches, marina neighbourhoods, and the closing chapter of the Saadiyat Island masterplan sit behind this release. Layouts, unit sizes, prices, and payment plans have not yet been released by Aldar. Register now so The Upsides can send release notices when chapters go live.
General information only, not investment advice. Prices, availability, specifications and charges are subject to change. The Upsides is a trading name of a licensed Abu Dhabi real estate brokerage holding authorised agency agreements with the respective developers for the projects referenced on this site (including Aldar Properties and Eagle Hills). This is not an official Aldar Properties PJSC or Eagle Hills website. Confirm details with us and licensed advisors before you commit. Forward-looking statements are subject to official confirmation by the relevant developer.
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