The emirate’s residential market experienced unprecedented momentum throughout 2025, with prime apartment sales reaching AED 2,428 per square foot—the highest level in the current cycle. Growth was concentrated across coastal developments including Al Marjan Island, Al Hamra, and Mina Al Arab, while villa prices averaged AED 1,211 per square foot, marking an 11% annual increase.
The performance comes amid broader economic resilience across the UAE, where non-oil sector growth and strong foreign direct investment have offset softer oil projections. RAK has capitalized on this environment through major industrial and tourism infrastructure, most notably the $5.2 billion Wynn Al Marjan Island development.
“The residential and hospitality sectors have entered a new phase of growth driven by global brand partnerships and a deepening pool of international buyers,” said Matthew Green, Head of Research at CBRE MENA.
The emirate’s business environment remained robust, with more than 19,000 new companies registered through RAKEZ alone, supporting steady employment growth and reinforcing sustained real estate demand.
Rental Market Dynamics
Apartment rents surged nearly 25% year-on-year, supported by new supply deliveries in key communities. Villa rents remained broadly stable, though prime locations like Mina Al Arab recorded notable increases. CBRE noted that rapid escalation in prime pricing has created a growing divergence between sales and rental values, a trend expected to moderate as new inventory reaches completion in coming years.
Luxury Segment Expansion
High-profile project launches including Mondrian Beach Residences and Jacob & Co Residences continue to elevate the emirate’s luxury positioning. Despite a year-on-year reduction in overall sales volume due to mid-market launches in districts like RAK Central, the market witnessed a strong rebound in the fourth quarter, underscoring ongoing demand depth.
Record Hospitality Performance
The hospitality sector delivered standout results, with visitor arrivals reaching an all-time high of 1.36 million during 2025. Key metrics showed broad-based improvement: occupancy rose 4.6 percentage points, Average Daily Rate increased 6.6%, and RevPAR surged 11.5% year-on-year.
RAK’s hotel inventory now exceeds 9,000 keys, with a development pipeline for 2026–2030 planning more than 9,500 additional keys. Notably, 92% of planned inventory falls within the five-star category, as international operators deepen their presence and new entrants diversify the luxury landscape.
Market Outlook
As the delivery cycle accelerates from 2027 onwards, RAK is positioned to solidify its standing as one of the UAE’s most dynamic real estate markets. The emirate’s low inflation environment, combined with its strong sovereign rating and record greenfield investment levels, provides a solid foundation for continued growth.
The performance aligns with broader trends across the region, where GCC real estate markets maintain upward momentum through the first half of 2026, driven by easing monetary conditions and infrastructure investment. The UAE is also set to add 390,000 residential units by 2030, reflecting one of the region’s largest residential expansion cycles.