Dubai’s property sector experienced a remarkable surge in the first quarter of 2025, with figures released by the Dubai Land Department (DLD) indicating a 29% year-on-year increase in total transaction value, reaching AED 114 billion. Additionally, the volume of property sales grew by 23% when compared to the corresponding period in 2024.
Momentum Continues into Q1 2025
According to the Dubai Real Estate Market Report, the first quarter of 2025 witnessed a 58% increase in the total value of sales transactions compared to Q1 2024. When measured against the previous quarter, sales volume also registered a modest 7% gain, signaling continued market momentum.
Growing Demand for Villas and Townhouses
A notable highlight of this growth is the 65% year-on-year increase in villa and townhouse transactions. This rise reflects both strong buyer sentiment and a growing preference for permanent residential solutions, whether for family living or long-term investment. The current climate presents a compelling opportunity for those considering property ownership in Dubai.
Rental Market Undergoes Gradual Shift
As the ownership trend gains traction, the rental segment has begun to adjust accordingly. The DLD recorded an average property sale price of AED 2.7 million in Q1 2025, indicating that homeownership is becoming a more attainable option for many.
In line with this shift, rental activity has softened, with a 9% decrease in contract renewals and a 19% reduction in new rental agreements during the quarter. While rental prices are not expected to drop sharply in the short term, the decline in rental transactions—down by 13%—may suggest a gradual balancing of the market. This evolution could foster greater equilibrium between supply and demand as landlords respond to changing dynamics.
Q1 2025 Market Highlights:
- 58% year-on-year rise in total sales transaction value
- 31% increase in average property prices
- 43% growth in villa/townhouse transaction volume during Q1
- 29% year-on-year increase in total transaction value (Dubai Land Department)
- 19% decline in new rental contracts (Dubai Land Department)
Source: https://www.arabianbusiness.com/industries/real-estate/dubai-real-estate-property-market-sees-strong-q1-2025-growth-shift-towards-homeownership
