Dubai Real Estate Market 2025: Preliminary Year-End Insights for Investors

While the final annual statistics will only be available in early January, current data already allows the market to be read with reasonable clarity.

The key trends of 2025 have largely formed, offering investors a solid basis for strategic assessment.

Population Growth and Demand Structure

Dubai’s permanent population reached 4.02 million in Q3 2025, representing a +4% increase year-to-date.

Importantly, demand is increasingly driven by people who live and work in the city, rather than purely capital-driven inflows.

This shift is structurally supportive and reduces volatility typically associated with speculative cycles.

Market Activity: Normalisation on a Strong Base

In October, total transaction volume declined by –4.9% year-on-year.

At the same time, October 2025 became the second most active October in the history of Dubai’s real estate market.

This points to normalisation rather than reversal.

Activity remains elevated, but without the overheating observed during the exceptionally strong 2024 cycle.

Off-Plan Market Dynamics

Off-plan transactions continue to dominate, accounting for approximately 70% of total market activity.

However, off-plan resales have continued to decline and are now below last year’s average levels.

This suggests a structural shift:

• Off-plan has become largely an international, long-term market
• Developer payment plans remain the primary entry mechanism
• Speculative flipping is gradually giving way to longer holding strategies

Pricing: Growth Without Acceleration

The average market price stands at approximately AED 1,683 per sq. ft.

• Annual growth: +14.3%
• Prices are approximately 36% above the 2014 peak
• More than double the 2020 market low

The current phase can be described as inertial growth:

Prices are not declining, but upward momentum has slowed and stabilised.

Secondary Market: Pressure, Then Stabilisation

The secondary market continues to face pressure from several factors:

• Part of demand is shifting to new developments
• High entry prices limit transactional activity

At the same time, mortgage activity has started to recover following recent rate reductions.

This is gradually restoring interest in completed properties.

Overall, the ready market appears to be stabilising rather than weakening.

Rental Market

Rental growth persists, but in a more selective and location-driven manner.

• New contracts: +12.4% quarter-on-quarter
• Active contracts: +3.9% year-on-year

Growth is typically observed in:

• Areas closely linked to expatriate employment
• Projects with strong specifications and professional management

Demand by Segment

Demand structure continues to evolve:

• The mid-segment dominates transaction volumes
• The AED 3–5 million range is gaining share
• The lowest budget segment is gradually contracting

The affordable segment is no longer “cheap”. Buyers increasingly prioritise comfort, layout quality, and functionality.

New Project Launches

Over the past 12 months, new project launches have remained at record levels.

The market is absorbing a growing number of projects, predominantly apartments, with an increasing number of active developers.

This intensifies competition and raises the importance of asset selection.

The market is no longer indiscriminate — quality, location, and execution now matter materially.

Market Summary

📌 Dubai’s real estate market in 2025 can be characterised as a phase of cooling without decline:

• Activity remains high
• Prices are stable
• Demand has become more selective
• Growth is increasingly supported by real residency rather than speculative capital

For investors, this is a market where strategy and asset choice matter more than timing alone.