Dubai’s meteoric rise as a global hub has shown no signs of slowing down, but its booming real estate market, skyrocketing population, and worsening congestion are putting growing pressure on residents.
Dubai’s Real Estate Boom Sparks Housing and Traffic Concerns
Dubai, famed for its iconic skyscrapers and tax-free lifestyle, is experiencing a surge in real estate transactions, with rental prices in prime locations escalating by up to 20% over the past year, according to Engel & Völkers. Despite a steady stream of new developments, demand continues to exceed supply, as highlighted by The Economic Times.
Hasnain Malik, managing director at Tellimer, cautions that “Dubai is expanding at an exceptional rate, but rising affordability challenges cannot be ignored.”
With the emirate’s ambitious growth plans, its population is forecasted to climb to 5.8 million by 2040, a significant leap from today’s 3.8 million. This marks an astonishing rise from the mere 255,000 residents recorded in 1980.
The legalization of foreign property ownership in 2002 has been a key driver behind Dubai’s booming real estate market, attracting a wave of affluent investors and high-net-worth individuals.
However, this rapid expansion has fueled soaring property prices and rental rates, prompting many residents to relocate to more affordable districts or even neighboring emirates such as Sharjah.
The city’s transport network is under mounting pressure, with approximately one million daily commuters traveling from surrounding emirates, causing heavy congestion on major roads.
Sheikh Zayed Road, Dubai’s principal 12-lane highway, has witnessed worsening traffic conditions as an increasing number of residents opt for longer commutes over the city’s rising housing costs.
The issue has become so severe that even notable Emiratis are voicing concerns.
Prominent Emirati lawyer Habib Al Mulla recently acknowledged government efforts to address the situation but emphasized the need for “both immediate and long-term strategies” to tackle the worsening congestion in a post on X (formerly Twitter) last December.
Dubai’s Road and Transportation Authority (RTA) has reported a vehicle growth rate of 10% over the last two years—far exceeding the global average of 4%. The sharp increase in car registrations has even led to the introduction of longer license plates to accommodate demand.
The city’s rising population has also reignited discussions about the declining proportion of Emirati nationals. Although official figures remain undisclosed, estimates indicate that Emiratis constitute just 10% of the UAE’s total population of over nine million. As more expatriates and investors continue to arrive, this percentage is expected to shrink further.
