Dubai’s residential real estate market exhibited strong resilience in the first quarter of 2025, with transaction volumes surging 23 percent year-on-year to reach 42,274 sales across both secondary and off-plan markets, according to a new report from Espace Real Estate.
The quarter witnessed robust activity despite early indications of market stabilization, with transaction volumes declining 10 percent quarter-on-quarter amid broader global economic uncertainty. “The Dubai residential real estate market continues to demonstrate remarkable resilience and growth in Q1 2025. Transaction volumes remained robust, buoyed by sustained demand for both off-plan and ready properties,” said John Lyons, Managing Director at Espace Real Estate.
Off-plan transactions comprised 59 percent of all residential deals, maintaining a trend observed throughout 2024, the report indicated. This shift in investor sentiment reflects a move away from speculative buying towards a more measured approach that could support long-term market health.
Luxury segment sees remarkable transaction activity
The luxury segment exhibited particularly strong performance, with properties priced above AED 20 million recording the largest increase in transaction activity both year-on-year and quarter-on-quarter in the secondary market. Villa and townhouse communities experienced significant price appreciation, with 19 of the 20 tracked communities reporting increases, averaging 23 percent. Emirates Hills led the way with a remarkable 101 percent price increase, followed closely by Jumeirah Islands at 52 percent.
Read more | Dubai real estate: Luxury home sales surge as 7,200 millionaires flock to UAE in 2024
Apartment communities see price growth
Apartment communities also witnessed price growth across all 11 tracked areas, albeit at a more moderate average of 10 percent. The Views area recorded the highest increase at 17 percent. Quarter-on-quarter figures in the secondary market showed an uptick in transaction volume, indicating a continued shift among tenants toward homeownership.
Decline in rental contracts yet prices continue to rise
This trend is supported by an 8 percent decline in villa/townhouse rental contracts and a 17 percent decrease in apartment rental contracts compared to Q1 2024. Despite fewer rental transactions, rental prices continued to increase, with villa rentals rising by an average of 19 percent year-on-year. Emirates Hills and Tilal Al Ghaf recorded the highest increases at 33 percent and 47 percent, respectively. Apartment rentals rose by an average of 11 percent, with City Walk seeing the most significant increase at 19 percent.
Growing international appeal of Dubai
Buyer activity reflects Dubai’s expanding international appeal, with a notable increase in geographic diversification in foreign investment. “At Espace Real Estate, buyer activity continues to show that Dubai remains highly appealing to a global audience, with a diverse mix of buyer nationalities. While Western European countries continue to feature prominently, we are now observing increased geographic diversification, with growing interest from Eastern Europe. This shift underscores Dubai’s widening international appeal,” Lyons remarked.
The off-plan market saw 7,008 completed units in Q1 2025, representing a 15 percent decrease compared to the same period last year. As market conditions evolve, the report suggests that this current moderation may ultimately contribute to more sustainable long-term growth for Dubai’s property sector.
