Apartment prices increased by 21.4 percent while villa prices rose by 30.3 percent annually.
Dubai’s Property Market Thrives Amid Population Growth and Strong Demand
Dubai’s property market continues its impressive expansion, spurred by a steadily increasing population and consistent housing demand, as revealed in a recent industry study.
As per the findings from ValuStrat, the city’s population climbed to 3.92 million by March 2025, with 89,695 new residents relocating in the first quarter alone. This rapid population rise has intensified the need for housing, prompting the delivery of around 61,580 new residential units in 2025, of which 19 percent were finalized during Q1.
Housing Sector Overview
ValuStrat’s Price Index (VPI) illustrates notable yearly growth in residential property values. Apartment values grew by 21.4 percent, while villa values recorded an increase of 30.3 percent. Rental figures also climbed, with villas witnessing a 5.1 percent rise and apartments seeing a 10 percent hike. Despite the robust demand, accessing affordable homes is becoming increasingly difficult. The overall gross external debt tied to the residential market points to an imbalance between housing availability and demand, signaling a possible adjustment in the market. In the first quarter of 2025, the number of residential sale transactions declined, mainly due to a reduction in mortgage activity compared to earlier quarters.
Commercial Office Landscape
Dubai’s office property segment remains strong, with annual capital values up by 29.1 percent and asking rental rates rising by 20.2 percent. This momentum is supported by the emirate’s continuous economic development and corporate expansion. The current average value for office properties is AED 20,591 per square meter, with the most expensive offices found in Downtown Dubai.
Retail and Tourism Sectors
The retail market maintains healthy performance, with Emaar Properties reporting AED 4.6 billion in revenue from its shopping center operations in 2024. Dubai Mall remains the world’s top destination in terms of footfall, recording 111 million visitors. Upcoming shopping centers such as Nad Al Sheba Mall are expected to introduce substantial retail space to the landscape. In terms of tourism, Dubai had a total of 128,417 hotel rooms and 26,021 hotel apartments as of February 2025. The average daily room rate climbed to AED 702, pointing to a robust tourism industry, while hotel occupancy remained steady at 87.1 percent.
Growth in the Industrial Sector
Dubai’s industrial segment is also on an upward trajectory, with the VPI for industrial property values reaching 152.2 points—a 12.7 percent year-on-year improvement. The demand for storage and logistics facilities is rising steadily, driven by increasing economic activity across the region.
