Dubai House Prices Continue Climbing, Yet Relief for Buyers and Tenants is Imminent
Dubai's Real Estate Market Sees Continued Growth, But Supply Increase Offers More Options for Buyers
Dubai's property market continues to thrive, with strong growth in villas and apartments, according to recent reports. In the first half of 2025, average property prices have risen significantly, with villas seeing a year-on-year price increase of around 28.7% and apartments increasing by about 19.1%.
The average property price is currently around Dh1,582 to Dh1,609 per square foot, marking an increase of 6% compared to late 2024 and 3% quarter-on-quarter in early 2025. Villa prices average around Dh8.34 million, while apartments average Dh1.3 million, offering a wide range of affordability with apartments being the more accessible option for buyers.
Despite this strong price momentum, Dubai's property market is experiencing a significant increase in supply. Approximately 17,500 new homes have been completed in the first half of 2025, and 66,596 units are expected by year-end, with 65% being apartments and 35% villas and townhouses.
This increased supply is expected to moderate price rises over time and provide more choice for buyers and renters, potentially leading to a more balanced market. Some communities, such as Jumeirah Islands, Palm Jumeirah, Arabian Ranches, have seen villa values more than triple since 2021.
In terms of sales, there were 16,003 cash sales of ready properties (Dh37 billion) and 11,589 mortgage deals (Dh24 billion) in Q2 2025. The secondary market also surged, with 13,691 resale deals, with nearly 36.4% priced under Dh1 million, still a key entry point for budget-conscious buyers.
Overall rents are up 1% quarter-on-quarter and 6.2% year-on-year, with villa rents flat quarter-on-quarter and up 4.8% year-on-year. The average annual asking rents by unit are Dh64,000 for a studio, Dh91,000 for a 1-bed, Dh131,000 for a 2-bed, Dh191,000 for a 3-bed, and Dh335,000, Dh426,000, and Dh522,000 for 3-, 4-, and 5-bed villa rentals, respectively.
While cash transactions dominate, mortgage-backed transactions are climbing steadily as more residents choose long-term stays and homeownership. Nearly 200,000 homes are in the pipeline until 2029, with recent project handovers including 1,160 units in JVC, 1,029 units in Arjan, 575 units in Dubai Science Park, 808 villas in Tilal Al Ghaf (Aura), and 61 villas in Damac Lagoons (Portofino 2).
The upcoming supply of homes may offer better deals, particularly for apartments, in non-prime areas. Some areas with the biggest gains in apartment prices last quarter include Remraam, Dubai Silicon Oasis, The Greens, and Town Square.
In summary, while prices remain elevated, the rising stock of villas and apartments may ease upward price pressure and stabilize the market as buyers and renters face more options. Dubai's real estate market remains on solid footing, but residents might soon find a slightly more balanced market with more listings and more negotiating power.
- The increase in supply of villas and apartments in Dubai's real estate market might lead to a more balanced market, providing more options for both buyers and renters.
- Recent news in science suggests that Dubai's housing market is expected to moderate price rises due to the significant increase in supply, offering a wider range of affordable options.
- In the first half of 2025, business and finance reports indicated a surge in sales of ready properties in Dubai, with over 16,000 cash sales and 11,589 mortgage deals.
- Investing in Dubai's real estate market remains attractive, with opportunities for better deals, particularly for apartments, in non-prime areas, according to the latest housing-market data.
- The Dubai real-estate market continues to outperform in growth, with villas and apartments increasing significantly in price, yet the finance sector reveals that this could soon be a more balanced market as more homes become available.
