Dubai’s residential real estate market continued its strong trajectory in the first half of 2025, with transaction volumes increasing 23 per cent year-on-year to 91,897 sales across both secondary and off-plan markets, according to a new report from Espace Real Estate.
The first half of the year saw robust activity, buoyed by sustained demand for both off-plan and ready properties.
While overall transaction volumes remained strong, a closer look at community-level data indicates that the market is now entering a stabilisation phase of the cycle, according to Espace analysis.
Dubai real estate
In many of Dubai’s most established communities, slightly lower levels of transactional activity were recorded. However, both rental and capital values continued to rise, highlighting a shift toward long-term residency.
John Lyons, Managing Director at Espace Real Estate, said: “In H1 2025 the Dubai residential real estate market continues to demonstrate remarkable resilience and growth. Transaction volumes remained robust, buoyed by sustained demand for both off-plan and ready properties”.
Off-plan transactions accounted for 59 per cent of all residential activity in H1 2025, a slight decrease from 61 per cent during the same period last year, the report noted.
As of H1 2025, 17,013 off-plan units were completed, reflecting a notable increase in available rental stock. This new supply is contributing to a moderation of rental price growth across the wider market, particularly in newly handed-over communities.
The report notes a shift in resident behaviour, with a growing number of people now viewing Dubai as a long-term home rather than a short-term expat base.
This evolution is supporting greater stability in the market and contributing to more measured, sustainable growth.
The luxury segment experienced particularly strong performance, with properties priced above AED20m ($5.4m) recording the largest increase in transaction activity both year-on-year and compared to H2 2024.
This reinforces the ongoing trend of Dubai continuing to attract global wealth. Notably, changes to the so-called “non-dom” tax regulations in the UK have prompted many ultra-wealthy UK residents to relocate to Dubai.
Villa and townhouse communities recorded a clear divergence from the apartment segment in terms of price appreciation.
Of the 20 villa and townhouse communities tracked in this report, 19 saw price increases, with the average rise standing at 19 per cent. The limited supply within this segment continues to drive price growth.
Average selling prices increased in 10 out of the 11 apartment communities tracked, although at a more moderate pace than H1 2024.
The average increase was 8 per cent in H1 2025 compared to 17 per cent during the same period last year, suggesting a more moderated pace of growth in this segment.
Rental activity has slightly declined in the communities tracked in the report, largely due to greater availability across the market.
While prices have continued to rise, the handover of new communities is helping to balance demand with supply, keeping rental price increases from accelerating further.
At Espace Real Estate, buyer activity continues to highlight Dubai’s strong global appeal, with demand driven by a broad mix of international buyers.
While the UK has long remained the top source of investors, there is growing interest from across Europe, North America and Asia Pacific.
This trend reflects Dubai’s rising status as a long-term home for wealthy global citizens.
As market conditions evolve, the report suggests the current moderation may ultimately contribute to more sustainable long-term growth for Dubai’s property sector.
