High-net-worth individuals (HNWI) are expected to spend $408.3 million on residential real estate in Abu Dhabi and $388.5 million in Ras Al Khaimah (RAK), according to Knight Frank’s 2024 Destination Dubai report. The consultancy surveyed 317 HNWI globally, including 100 GCC-based expats, to understand their real estate investment preferences in the UAE. Collectively, these HNWI have a net worth of $5.4 billion and own 1,149 homes worldwide.
In Abu Dhabi, 23% of HNWI expressed interest in purchasing real estate. This interest grows significantly among those with higher net worths—57% of individuals with over $15 million in assets are keen to buy property in the UAE capital.
Knight Frank highlighted the effectiveness of the “Visit Abu Dhabi” campaign, which has influenced 50% of GCC-based expat HNWI and 67% of global HNWI with a net worth of over $20 million to consider visiting the city.
“Residential values in Abu Dhabi have remained relatively stable for the last four years, which has played a significant role in encouraging domestic buyers to transition from renting to owning,” explained Shehzad Jamal, Partner – Strategy and Consultancy, MEA. “And with homes in Abu Dhabi trading for around Dh1,000 per square foot, they remain about one-third cheaper than Dubai, which is further adding to the appeal of home ownership in the city amongst domestic buyers.
“International buyers too have become increasingly active, contributing to the rising deal volumes now being recorded in the emirate.”
In 2023, Abu Dhabi recorded a significant increase in property transactions, with 15,653 deals totalling Dh87.1 billion, a 73.7% rise from 2022. The city also saw a 175% increase in non-resident investors.
“While 40% of HNWI plan to purchase in Abu Dhabi purely for investment reasons, 8% are keen on a primary residence in the city, while a further 15% would consider buying a second home in the UAE capital,” stated Faisal Durrani, Partner – Head of Research, MENA. “This is a watershed moment for the city, which has often trailed Dubai in this area.
“Furthermore, the sale of a Nobu-branded 3-bedroom penthouse in March represented a significant milestone for Abu Dhabi’s residential market,” he added. “This is not only because it is the most expensive property ever sold in the capital–both in terms of absolute price and price per square metre–but also because it signals Abu Dhabi’s emergence as a magnet for global capital.
“Indeed, this is reflected in the fact that the total value of sales to international buyers not residing in the UAE has jumped from just 3% of all of Aldar’s home sales in 2021 to 28% last year.”
Hot spots in Abu Dhabi and RAK
Preferred locations for property purchases in Abu Dhabi among HNWI include Abu Dhabi Island (21%) and Saadiyat Island (16%).
“Villas on Saadiyat Island have performed well over the last 12 months, with prices rising by 10% over the last 12 months,” Jamal stated. “However, prices have been hovering at a glass ceiling of around Dh1,500 psf for over three years, which may be why buyers are so keen on this location.
“By contrast, villa prices on the Palm Jumeirah in Dubai currently stand at around the Dh7,000 psf mark”.
GCC-based expat HNWI’s top location choices in Abu Dhabi include Saadiyat Island (32%) and Maryah Island (24%), while for global HNWI, Saadiyat Island (33%) emerged as the top pick.
Ras Al Khaimah, on the other hand, is emerging as a significant investment destination, with planned developments like the Wynn Resort boosting its appeal. Knight Frank found that 46% of global HNWI view RAK favourably due to its economic transformation and increasing tourism infrastructure. This figure rises to 75% among those with a net worth of over $20 million.
Jamal commented, “RAK has quietly carved out a niche for itself over the last 10 years, emerging as an alternative tourist magnet to Dubai.”
Knight Frank found that 46% of global HNWIs view RAK more favourably due to its economic transformation and increasing level of tourism infrastructure. This figure climbs to 75% of those with a net worth of over $20 million.
UAE-based HNWI expats (80%) and Saudi-based HNWI expats (60%) consider the arrival of the Wynn Resort most favourably in viewing RAK as a real estate investment destination, said the consultancy.
RAK in spotlight
Knight Frank’s report reveals that 30% of global HNWI are prepared to spend $500,000 on property in RAK, with higher budgets linked to greater personal net worth.
According to Knight Frank’s report, East Asian HNWIs are most convinced by RAK’s tourism and hospitality offerings. 28% are willing to spend $2 to $4.9 million on property in RAK, the highest percentage among all our HNWI regions.
On an individual level, GCC-based expats have the lowest budgets ($700,000), while global HNWI budgets range from $1.2 million for those with a net worth of less than $5 million and climb to $3.9 million amongst the UHNWI (net worth > $ 20 million).
“Not only have we managed to unearth $388.5 million in private capital that is poised to move into the RAK property market, but this figure is just 4.8% lower than we’ve uncovered for Abu Dhabi, highlighting how quickly RAK’s appeal has grown globally both as a tourist destination and a property investment location,” Durrani noted.