Dubai Real Estate Market Report: March 2025

Dubai’s real estate market showed strong momentum in March 2025, further reinforcing the city’s growing reputation as a global hotspot for both investors and residents. Prices are on the rise, transactions are picking up, and supply is struggling to keep pace with demand—especially when it comes to villas. These trends are unfolding alongside solid economic growth and a steadily increasing population, pointing to a new and transformative chapter for Dubai’s housing scene.

Top 5 Performing Areas By Sales Volume in 2025 vs 2024 (1st Sale)

Property prices have climbed significantly over the past few years. Since February 2021, average values have jumped by 75%, now sitting at AED 1,750 per square foot (about $476.50). This surge reflects strong interest from both local buyers and international investors, particularly in high-demand, premium neighborhoods. Even with these gains, Dubai still offers relatively competitive pricing when compared to other major global cities.

Monthly property sales volume off-plan vs. ready in All areas

Transaction data paints a clear picture of a lively market. In Q3 2024, Dubai recorded 47,269 property transactions—up 41.8% from the same period in 2023. This spike points to continued investor confidence and highlights Dubai’s ability to adapt and stay resilient despite global economic shifts.

However, one of the market's key challenges is the widening gap between supply and demand. Between 2025 and 2029, around 300,000 new homes are expected to be added, with apartments making up the bulk (80.1%) and villas only about 17.4%. That’s a concern, given the rising demand for more spacious homes—driven by lifestyle changes post-pandemic and a growing number of expat families looking for roomier living spaces.

By the end of 2025, just 19,700 new villas are expected to be delivered—well below what’s currently needed. This shortfall is pushing up prices in the villa segment and could create long-term issues around affordability and accessibility unless addressed through more targeted development strategies.

Demographics are adding to the pressure. As of early 2025, Dubai’s population is around 3.85 million, with expats making up roughly 87%. Projections for 2040 estimate that number could climb to 5.8 million and 8.6 million. To keep up, Dubai will need to build between 37,600 and 87,700 new homes every year, depending on how the population grows.

On the economic front, the outlook is upbeat. The UAE economy is expected to grow by 4.5% in 2025, with real estate playing a major role. Rental yields in Dubai remain attractive by global standards, averaging around 7%. That’s a big draw for investors, especially when you compare it to cities like London (2.4%) and New York (4.2%).

Top 10 Rental Performing Areas

Rental Transaction(s) Count Based On Number Of Bed(s)

The luxury property market has also seen a major upswing. In 2024, transactions for properties over $10 million nearly doubled, totaling $7.6 billion. This highlights Dubai’s continued appeal to high-net-worth individuals and cements its reputation as a top destination for luxury living.

Sustainability is gaining traction too. By 2025, about 35% of new office developments are expected to be LEED-certified, reflecting a growing focus on eco-friendly construction. This aligns with the UAE’s broader environmental goals, including its Net Zero 2050 commitment.

That said, rapid growth comes with its own set of challenges. The rising number of expatriates has pushed up the cost of living—especially rent, which has increased by 16% over the past year. Meanwhile, average salaries have remained fairly flat, putting pressure on many residents. Plus, the fast pace of urban expansion is starting to strain infrastructure, with traffic congestion and demand for better public services becoming more noticeable.

All things considered, the outlook for Dubai’s housing market remains largely positive. But for sustained success, it’ll be crucial to focus on balance—closing the supply-demand gap (especially for villas) and making sure infrastructure keeps pace. If those areas are addressed effectively, Dubai is well on track to solidify its status as a world-class city with a thriving, forward-looking real estate sector.

🔑 Key Statistics – Dubai Real Estate Report (March 2025)

🏷️ Property Prices

• Average property price: AED 1,750 per sq. ft. (~$476.50)
  ⬆️ +75% since February 2021

• Apartment prices: AED 1.3M
  ⬆️ +9.1% YoY

• Villa prices: AED 3.4M
  ⬆️ +2.7% YoY

• Commercial prices: AED 1.6M
  ⬆️ +28.4% YoY

• Plot prices: AED 3.3M
  ⬇️ -45.1% YoY

  
  

📈 Transaction Volume

• Total property transactions (March 2025): 15,200

• March 2024 comparison: 13,670 transactions

  
  

📊 Monthly Transactions in 2025

🏘️ Housing Supply (2025–2029 Projection)

• Total new homes expected: ~300,000

  • Apartments: 80.1%

  • Villas: 17.4%

• Only 19,700 villas expected to be delivered by end of 2025

  
  

👥 Demographics & Population Growth

• Current population (2025): 3.85 million

  • 87% are expatriates

• Projected by 2040: 5.8M to 8.6M

• Housing needed annually: 37,600 to 87,700 units

  
  

💰 Economic Outlook

• UAE GDP Growth (2025): 4.5%

• Rental yields:

  • Dubai: 7%

  • New York: 4.2%

  • London: 2.4%

    
    

🏡 Luxury Real Estate

• $10M+ property transactions in 2024:

  • Value nearly doubled

  • Total: $7.6 billion

    
    

🌱 Sustainability

• 35% of new office buildings expected to be LEED-certified by 2025

  
  

💸 Rental Prices – March 2025

🧾 Sales Value Share by Property Type (2025 YTD)

📍 Top 5 Areas by Sales Value – March 2025

• All Data Provided by dxbinteract.com