Dubai Real Estate Market 2025: Over 73,000 New Homes to be Delivered, Investment Activity Remains Strong
Dubai is set to add 73,000 residential units to its housing inventory in 2025, with projections reaching 300,000 units by 2028, according to data by property consultancy Cavendish Maxwell.
In the first quarter of 2025, the emirate recorded 42,000 property sales transactions valued at AED114.4 billion, showing a 10% drop from Q4 2024. However, this was still a 23% rise compared to the same period last year, indicating sustained interest and momentum.
Price Trends and Market Stability
Ronan Arthur, Director and Head of Residential Valuation at Cavendish Maxwell, noted that the market is showing moderate annual growth in both value and volume. Although prices dipped briefly at the start of 2025, they have been on a gradual rebound. Yet, the pace of growth is slowing—Q1 2025 saw a 2.8% increase compared to 4% average quarterly growth in 2023 and 2024.
Arthur explained, “With a weaker US dollar, high rental returns, and attractive yields, Dubai continues to capture the attention of local and foreign investors. This trend is expected to continue throughout 2025.”
Off-Plan Sales Dominate
Off-plan properties dominated with a 70% share of all transactions, amounting to AED77.5 billion across 29,000 deals—a 32% increase from Q1 2024. Secondary market activity also grew with 13,200 transactions, reflecting a 6.6% year-on-year rise.
Apartments made up 75% of all sales but saw a slight decrease in market share as interest in larger homes grew. Townhouses accounted for 17% and villas just over 7% of total sales.
The average price per square foot reached AED1,535, reflecting a 2.8% quarter-on-quarter increase and nearly 16% growth from Q1 2024.
Dubai Luxury Real Estate Performance
The luxury segment recorded 590 transactions for properties priced above AED20 million, up from 480 in the same period last year. Nearly 60 of these sales exceeded AED50 million. Arthur highlighted that off-plan properties represented 67% of luxury transactions, and nearly one-third of ultra-luxury deals.
Dubai’s ultra-premium market continues to attract high-net-worth individuals (HNWIs), thanks to tax-friendly policies, residency benefits, and global accessibility. While supply in the AED50 million+ bracket remains limited, steady demand solidifies this niche as a preferred investment class for elite buyers.
Upcoming Completions & Leading Areas
According to Cavendish Maxwell, more than 180,000 new homes are expected in 2026 and 2027, driven by ongoing project deliveries.
Jumeirah Village Circle (JVC) led completions in Q1 2025 with 4,330 units, alongside 3,330 apartment transactions, which included 2,200 off-plan and 1,132 secondary market sales.
Other top areas by completions:
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Mohammed Bin Rashid City: 1,037 units
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Business Bay: 743 units
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Downtown Jebel Ali: 647 units
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Rukan: 636 units
Looking ahead, JVC tops future supply with 27,100 units by 2028, followed by:
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Business Bay: 19,470 units
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Azizi Venice: 17,100 units
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DAMAC Lagoons: 10,730 units
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Arjan: 9,750 units
Apartments represented 80% of completions from January to March 2025. During the same period, 95 new real estate projects were launched, adding 28,600 new homes.
Off-Plan & Secondary Market Leaders
DAMAC Islands recorded the highest off-plan villa and townhouse activity with 1,430 transactions, followed by:
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The Valley
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DAMAC Hills 2
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Villanova
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DAMAC Lagoons
For secondary sales of villas and townhouses:
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DAMAC Hills 2: 318 transactions
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Al Furjan
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Emirates Living
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Reem
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Jumeirah Village Circle
Rental Yields and Market Adjustment
Apartment rental rates rose 14.4% compared to Q1 2024, though the quarterly growth slowed to 1%—the lowest in two years. This deceleration is attributed to new housing supply and regulatory tools like the Dubai Smart Rental Index, launched earlier this year.
Average rental yields stood at:
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7.3% for apartments
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5% for villas and townhouses
Top-performing areas for apartment rental yields:
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Dubai Investments Park: 10.3%
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International City: 9.1%
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Downtown Jebel Ali: 9%
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Dubai Production City: 8.6%
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Dubai Silicon Oasis: 8.5%
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Dubai Sports City: 8.4%
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Liwan & International City Phase 2: 8.2%
For villas and townhouses:
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Industrial City: 6%
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Jumeirah Village Circle: 5.9%
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DAMAC Hills 1 & 2: 5.7%
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International City & Serena: 5.5%
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Mudon & Villa Nova: 5.4%
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Dubai Hills Estate: 5.3%
Conclusion
Dubai’s real estate sector continues to thrive in 2025, with a surge in off-plan transactions, a healthy pipeline of future developments, and solid rental yields attracting investors from around the world. While price increases are moderating, demand remains robust, particularly in Jumeirah Village Circle, Business Bay, and ultra-luxury communities.
