The latest reports on Dubai real estate market indicate that the rate of population growth in the emirate will shape price trends starting next year and continuing through 2026, as thousands of sold residential units are delivered.
A report from S&P Global Ratings noted that large-scale real estate projects, fully sold in recent years, will see their residential units delivered over the next two years, leading to an oversupply. However, this will largely depend on the market’s ability to absorb these units.
Record Transactions and Sales Values
Ayman Youssef, Vice President of Coldwell Banker, told Erem Business that Dubai real estate market saw remarkable growth in 2024. He explained that the third quarter recorded the highest number of transactions ever, totaling 50,425—a 38% increase compared to last year. The total transaction value reached approximately AED 141.59 billion, reflecting a 30% rise compared to the third quarter of 2023.
Youssef also highlighted the growing appetite for villas and new real estate projects, predicting a remarkable 30% increase in property prices. He believes this upward trend will continue through the remainder of 2024 and into 2025. What’s particularly reassuring is how Dubai’s diversified economy—backed by thriving sectors like tourism, information technology, and manufacturing—acts as a buffer against economic and geopolitical uncertainties in the region.
He went on to explain that strategic investments in infrastructure, combined with ongoing government support, make Dubai a magnet for both businesses and residents. This not only enhances the quality of life but also fosters a sense of community, even in the face of global political fluctuations.
Influx of New Units
Looking ahead, reports suggest that around 41,000 residential units are set to be delivered in 2025, followed by another 42,000 units in 2026. This significant influx could spark more competition among sellers, potentially leading to a slight dip in prices in the short term. However, Youssef remains optimistic, believing that Dubai’s robust economic foundations, coupled with proactive market development initiatives, will promote stability and help the real estate sector thrive amidst global economic challenges.
Demand for Off-Plan Units
On another note, UAE-based real estate company Tenko Homes expects off-plan sales to stay among the most attractive investment options in 2024. This type of investment allows buyers to get in early, benefiting from flexible payment plans and lower prices compared to ready properties—making it an appealing choice for many.
The company also foresees a substantial rise in demand for luxury apartments in Dubai, particularly in sought-after areas like Downtown Dubai and Dubai Hills Estate. Buyers are increasingly drawn to these locations, which are close to iconic landmarks such as the Burj Khalifa and Dubai Mall. In addition, the villas in Dubai Hills Estate provide an ideal setting for family living, making them a popular choice for families and investors alike, who are looking for both comfort and convenience.
Record-High Rentals
Finally, it’s worth noting that Dubai’s rental market has experienced remarkable growth, with new rental contracts hitting levels not seen since Q4 2021. This surge in demand reflects the continuous influx of new residents and investors eager to call Dubai home. According to data from the Dubai Land Department, the average rent for apartments has surged by 19.3% year-over-year, reaching AED 68,000, while villa rents have increased by 5.88%, now averaging AED 180,000. This dynamic environment highlights Dubai’s appeal and the thriving community that continues to attract people from all walks of life.
