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Engel & Völkers Middle East, a provider of real estate services, has identified a notable shift in Dubai’s residential property market.
Increasing numbers of tenants, particularly families and young professionals, are transitioning to homeownership, moving away from the rental cycle to secure long-term financial stability and lifestyle benefits.
Read more-Buying or renting in Dubai? The 2025 market guide you can’t ignore
This behavioural shift is supported by hard data: secondary market sales rose by 22 per cent in the first eight months of 2025 compared to the same period last year. The trend reflects growing confidence among residents who are increasingly viewing Dubai not just as a temporary home, but as a permanent base for family and business life.
“For many tenants, ownership is no longer aspirational; it’s becoming the preferred choice for long-term security and value creation,” said Daniel Hadi, CEO of Engel & Völkers Middle East.
Dubai defies global slowdown
As global real estate markets face slowdowns, Dubai’s property sector continues to chart a divergent course. Market resilience is being driven by strategic government policy, robust infrastructure, and forward-looking economic diversification. Investor-friendly regulations, tax efficiency, and a secure business climate continue to attract capital from around the globe.
“Dubai continues to attract global capital through its investor-friendly environment, safe and stable governance, and dynamic economic diversification,” noted Mahdi Amjad, founder and executive chairman of Omniyat Group. “We see the growing appetite for design-led, experiential living of world-class standards, something Dubai delivers unlike any other city.”
Projects like Lumena by Omniyat, located on Sheikh Zayed Road and at the gateway to Business Bay, are a testament to this evolving demand. Global investors are increasingly drawn to lifestyle-focused real estate, blending wellness, design, and work into seamless urban experiences.
Dubai’s unique edge lies in its blend of large-scale ambition and clear regulatory frameworks, positioning it far ahead of many global cities in real estate innovation.
“It’s a place where ambitious ultra-luxury projects are underpinned by smart urban planning and regulatory clarity,” added Amjad. “From a developer’s lens, what sets Dubai apart is its ability to fuse lifestyle with investment. At OMNIYAT, we’ve been able to collaborate with global creative talents, creating living experiences that simply don’t exist elsewhere.”
August market data highlights strong demand
August 2025 marked a major milestone for Dubai’s residential market, with 17,879 transactions totaling Dhs42.4 billion. This reflects a 17 per cent increase in transaction volume and a 12 per cent rise in value year-on-year, according to Engel & Völkers.
Off-plan sales dominated the market, rising 25 per cent year-on-year and accounting for nearly 75 per cent of all transactions. Meanwhile, the secondary market maintained strong momentum, driven primarily by end-user demand.
The market showed strong appetite for larger properties. Sales of four-bedroom homes rose by 70 per cent, while transactions involving five-bedroom or larger properties surged 63 per cent over the past year.
Price growth remains robust
Dubai’s property prices continued their upward trajectory in August. Data from Property Monitor shows the average price reaching Dhs1,664 per square foot, up 16.3 per cent compared to last year.
Lifestyle-centric villa communities have seen the most significant gains:
- Victory Heights: +37.0 per cent
- Dubai Hills Estate: +26.0 per cent
- Arabian Ranches: +23.2 per cent
Apartments also saw notable appreciation in:
- Jumeirah Village Triangle: +29.3 per cent
- Jumeirah Village Circle: +17.0 per cent
Global yields, local advantage
Dubai’s rental yields continue to outperform those in other prime cities globally. In August, gross yields stood at:
- 6.76 per cent overall
- 7.12 per cent for apartments
- 4.92 per cent for villas
These figures remain comfortably above those of global hubs like London (3–5 per cent), Singapore (3–4 per cent), and New York (5–7 per cent). The strength of Dubai’s yields is underpinned by population growth, a surge in business formations, and limited availability of premium rental stock.
Although leasing volumes declined 4 per cent year-to-date, with new contracts falling 14 per cent and renewals up 2.6 per cent, the data points to a larger trend: a growing preference for ownership, particularly in the luxury segment.
The number of large villa leases has dropped in double digits, highlighting that families are increasingly moving toward purchasing rather than renting, especially in premium communities.
Demand remains international and diverse
Dubai continues to be a magnet for international investment. Buyers from Europe, the Middle East, and Asia remain active, particularly in the off-plan market. Indian, British, German, Egyptian, and Chinese investors are especially prominent in recent activity.
Residents, however, are the main drivers of the booming resale market. Mortgages play a key role in enabling this shift, with competitive loan-to-value ratios of 70–80 per cent and interest rates hovering around 3.9 per cent. Flexible developer-backed payment plans and cash transactions are further fueling the off-plan segment.
“Dubai’s market today is being fueled by a dual dynamic: strong global investment flows into off-plan projects and a clear shift among residents toward homeownership,” said Hadi. “August’s activity reflects both the city’s international appeal and the growing number of long-term residents putting down roots.”
A future focused on long-term value
Looking ahead to the final quarter of 2025, Engel & Völkers anticipates continued momentum in both off-plan and resale markets. Developers are likely to remain aggressive with launches and incentives, while the resale segment will benefit from population growth, end-user demand, and accessible mortgage financing.
“Dubai’s property market is no longer just about short-term investment cycles. It is increasingly about residents choosing to establish roots here, buying homes for security, lifestyle, and long-term value creation. This shift is set to define the next phase of the city’s real estate story,” Hadi concluded.
Amjad agrees: “The market will move from volume to value. We anticipate sustained demand in the ultra-luxury segment, driven by global citizens seeking exceptional lifestyles, design, and a sense of belonging. At OMNIYAT, we’ll continue to respond to this evolution by shaping spaces that blend architecture, art, and hospitality into a new paradigm of urban living.”
