Staff Report
Dubai, UAE
As many as 73,000 homes are expected to boost Dubai’s real estate supply in 2025 and another 300,000 will bolster the market by 2028, according to insights by Cavendish Maxwell, a leading real estate advisory and property consultant. The figures build upon Dubai’s first quarter performance in 2025, underpinned by Dh114 billion worth of properties sold across 42,000 transactions.
Ronan Arthur, MRICS, Director and Head of Residential Valuation at Cavendish Maxwell, said, “Dubai’s property market is on track for a modest annual increase in terms of sales volumes and values, but there are indications that prices are beginning to stabilise. 2025 began with a brief dip in prices per sq ft, followed by a steady recovery. While prices are still on the up, the pace is showing signs of slowing down. For example, the average quarterly price increase for 2023 and 2024 was 4%, compared to a 2.8% rise in Q1 this year against Q4 2024.
“With a weakened US dollar, strong rental returns and appealing yields, Dubai continues to attract local and international property investors. We expect this trend to continue throughout the year.”
Off plan dominated sales with 29,000 transactions valued at Dh77.5 billion, accounting for 70 percent of the total and marking an increase of 32 percent from Q1 2024. With 13,200 sales secured, the secondary market saw a 6.6 percent rise in transactions against Q1 2024.
Among unit types, apartments sales made up more than three in every four transactions (76%), with townhouses at almost 17 percent and villas just over seven percent. However, the apartment market share is starting to shift, driven by demand for more space as families look to settle in Dubai for the long term. In addition, investors are increasingly targeting larger properties, in recognition of their rental potential to families and long-term residents.
Apartments accounted for almost 80 percent of all projects completed from January to March this year. In the same period, 95 real estate projects, which will deliver nearly 28,600 new units, were launched. More than 180,000 will be delivered in 2026 and 2027, when a surge in project completions is expected, the company said.
Dubai’s luxury and ultra luxury property markets remain strong, reinforcing the city’s status as a global destination for top-end real estate. Nearly 600 properties were sold for Dh20 million or more in Q1, up from 480 in the same period last year. Almost 60 homes were sold for Dh50 million. Off-plan property sales accounted for 67 percent of luxury transactions and nearly a third of ultra luxury sales.
“Demand from high-net-worth-individuals is fuelled by Dubai’s favourable tax policies, long term residency incentives and global connectivity,” said Ronan Arthur. “And while the ultra-luxury segment – properties valued at AED50 million or more – has limited supply, transaction volumes continue to show steady performance. Despite quarterly fluctuations, this segment remains stable, solidifying its position as a niche investment class for elite buyers from the UAE and internationally.
Area-wise, Jumeirah Village Circle saw the highest number of project completions with more than 2,433 of the total 9,300 in Q1. JVC is also top of the upcoming supply chart, with nearly 27,100 units due for delivery between now and the end of 2028. Business Bay, Azizi Venice, and Damac Lagoons will deliver 19,470, 17,100, and 10,730 units, respectively.
JVC also commanded the top position for apartment sales in Q1 with 3,330 sales, including nearly 2,220 off-plan. Dubai Residence Complex, Business Bay, Expo City and Dubai Marina. Business Bay, Dubai Marina, Downtown Dubai, and International City also made the top five areas for secondary sales.
Transactions for off-plan villas and townhouses were highest in Damac Islands, with 1,430 sales, followed by The Valley, Damac Hills 2, Villanova, and Damac Lagoons. Meanwhile, Damac Hills 2 led the way for secondary sales with 318 transactions, followed by Al Furjan, Emirates Living, Reem, and Jumeirah Village Circle.
Q1 residential rents were up 14.4 percent on the same period last year. However, the quarterly increase was the lowest in the last two years, with a rise of one percent compared to Q4 2024, against previous quarterly increases ranging from two percent to six percent.
Ronan Arthur added, “This slower pace of growth could be partly driven by the influx of new units delivered in the first three months of the year, as well as the Dubai Smart Rental Index, introduced at the beginning of the year, which is likely to influence tenant expectations and price adjustments. With additional supply on the way, monitoring how rental trends evolve in response to increasing inventory and a shifting, regulatory framework will be crucial.”
At the end of March 2025, average gross rental yields in Dubai stood at 7.3 percent for apartments and 5 percent for villas and townhouses, with return on investment remaining relatively stable and continuing to outperform many global markets.
Dubai Investments Park was top for rental yields, at 10.3 percent, followed by International City (9.1 percent), Downtown Jebel Ali (9 percent), Dubai Production City (8.6 percent), Dubai Silicon Oasis (8.5 percent), Dubai Sports City (8.4 percent), Liwan and International City Phase 2 (both 8.2 percent).
Industrial City led the villa and townhouse yield chart at six percent. Next were Jumeirah Village Circle (5.9 percent), Damac Hills 1 and 2 (both 5.7 percent), International City and Serena (both 5.5 percent), Mudon and Villa Nova (both 5.4 percent) and Dubai Hills Estate (5.3 percent).
Ends
Also read: Dubai realty sales up 7% to new monthly record of Dh66.8 bn in May
