In the first quarter of 2025, the residential real estate market in Dubai shown consistent strength. According to a recent survey from Espace Real Estate, this resulted in a 23% rise in transaction volume and 42,274 transactions in secondary and off-plan marketplaces.
Despite previous signs of market stabilization, the quarter recorded robust activity. This has led to a decline in the volume of trading in the middle of wider global economic uncertainty in the year.
“The Dubai residential real estate market continues to demonstrate remarkable resilience and growth in Q1 2025. Transaction volumes remained robust, buoyed by sustained demand for both off-plan and ready properties,” John Lyons, Managing Director at Espace Real Estate said.
Luxury Dubai Homes See Prices Soar 101% Amid Booming Market
Off-plan transactions accounted for 59% of all residential transactions and continued the trends observed during 2024, the report states.
The report states that changes in investors’ moods from speculative purchases are held at a more measured pace, capable of supporting long-term market health.
The luxury segment recorded particularly strong performance, with properties priced above AED 20 million leading the surge, which recorded the biggest increase in transactional activity compared to the previous year and secondary market quarter.
Significant price rises were observed in villa and townhouse communities; 19 out of 20 communities under observation saw increases, with an average of 23%.
With a price rise of 101%, Emirates Hills took the lead, followed by Jumeirah Islands at 52%.
Although at a more moderate average of 10%, apartment community prices increased in all 11 examined areas, with the Views area seeing the most increase at 17%.
The secondary market’s quarter-over-quarter data showed a rise in transaction volume, suggesting that tenants are still moving toward owning.
An 8% drop in villa/townhouse rental contracts and a 17% drop in flat rental contracts from Q1 2024 lend support to this trend.
Dubai Rental Market Shrinks as Homeownership Rises Among Residents
Even though there were fewer rental transactions, rental prices were still rising; on average, villa rentals rose by 19% every year.
Emirates Hills and Tilal Al Ghaf saw the biggest gains, rising 33% and 47%, respectively.
Flat rentals increased by 11% on average, with City Walk experiencing the biggest increase at 19%.
Due to greater regional diversification in foreign investment, buyer activity shows Dubai’s increasing appeal on a global scale.
“At Espace Real Estate, buyer activity continues to show that Dubai remains highly appealing to a global audience, with a diverse mix of buyer nationalities. While Western European countries continue to feature prominently, we are now observing increased geographic diversification, with growing interest from Eastern Europe. This shift underscores Dubai’s widening international appeal” Lyons said.
The units were finished in the off-plan market during the first quarter of 2025. When compared to the same time last year, this is a 15% drop.
According to the analysis, present deceleration can eventually lead to more sustainable, long-term growth in Dubai’s real estate sector, even though the market scenario is still evolving.