The Dubai residential property market delivered another record-breaking year in 2025, supported by sustained demand from end-users and investors, rising capital values and continued international interest, according to Savills Middle East.
Residential transaction volumes exceeded 200,000 transactions during the year, representing an 18 per cent year-on-year increase and marking the third consecutive year of record activity, the consultancy said in its Dubai Residential Market Report 2025.
Apartments continued to dominate market activity, accounting for 83 per cent of total transactions, while villas and townhouses maintained a steady share of overall demand.
Dubai real estate 2025
Off-plan sales continued to gain momentum, representing 72 per cent of all residential transactions in 2025, up from 68 per cent in 2024.
While absorption rates moderated, Savills said high-quality developments from established developers continued to sell rapidly, underlining demand for well-located, well-priced projects offering attractive payment structures.
Savills identified several key themes shaping the market in 2025:
- Sustained demand: Strong population growth and investor confidence supported activity, with quarterly transactions exceeding 50,000 for the third consecutive quarter
- Capital value growth: Average apartment prices remained stable at around AED1.9m ($517,000), while average villa and townhouse ticket prices exceeded AED6m ($1.63m), up from AED5.4m ($1.47m) in 2024
- Investment appetite: The proportion of transactions above AED 5 million ($1.36 million) increased to 9 per cent, reflecting rising values and continued interest in higher-priced residential assets
- Off-plan versus ready: Ready market transaction volumes remained stable at approximately 15,000 per quarter, despite increasing supply, while off-plan transactions continued to gain market share
Outlook for 2026
Looking ahead, Dubai’s residential market enters 2026 from a position of strength, supported by robust fundamentals, continued population growth and sustained interest from international buyers.
While future supply is expected to increase meaningfully, Savills expects market performance to vary by segment and location, with villas, prime residential stock and well-located communities remaining relatively resilient.
Andrew Cummings, Head of Residential Agency at Savills Middle East, said: “Dubai enters 2026 from a position of exceptional strength. The past year has reaffirmed the depth and maturity of the residential market, with demand being driven not only by volume, but by quality, long-term confidence and increasingly sophisticated buyer behaviour.
“We are seeing sustained interest across both prime and mainstream segments, underpinned by population growth, global capital inflows and Dubai’s continued appeal as a place to live, work and invest.
“As the market evolves, what we are seeing is not a correction but a maturing cycle. Activity is becoming more selective, with buyers placing greater emphasis on well-located, high-quality developments and lifestyle-led communities.
“While new supply will continue to come to market, the fundamentals supporting demand remain firmly in place, positioning Dubai to maintain its role as one of the world’s most resilient and attractive residential markets in 2026.”
Rachael Kennerley, Director of Research at Savills Middle East, said: “2025 has been a remarkable year for Dubai’s residential real estate with sustained demand driving transaction volumes to record highs and the launch of several significant masterplan developments.
“Q4 continued this trend, although buyers are becoming increasingly discerning, with quality developers, established communities and prime locations all coming to the forefront.
“2026 appears set for further maturing of Dubai’s residential market. Segmental dynamics are likely to come into play as oversupply is not uniform and the geography of the city evolves in line with infrastructure changes.”
Savills expects 2026 to be characterised by more moderate growth and increased differentiation across the market, reinforcing the importance of asset selection, location and product quality as Dubai’s residential sector continues to mature.
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