Dubai’s real estate sector is booming, with multiple factors driving price surges and fueling high-value transactions like the recent $4.7 billion hit in week, underscoring strong investor confidence.
Dubai’s real estate market continues to soar, fuelled by strong investor confidence and a growing population. Data from the Land Department shows a recent AED17.28bn ($4.7 billion) transaction a week, largely driven by around 3,886 sales transactions which were recorded between March 17 and March 21.
As the demand for luxury real estate escalates, Dubai’s prime locations, including Palm Jumeirah, Palm Jebel Ali, and Dubai South, are attracting both local and international investors, further driving up prices.
Prime real estate is on a steady growth trajectory, with property values in the sector expected to rise by 5% in 2025. Rental prices are climbing, especially in sought-after areas, due to strong expatriate demand.
However, with supply unable to meet the growing demand, both buyers and tenants should expect further price increases, making early investments essential to maximizing returns.
“Dubai’s real estate sector continues to thrive due to a diversified economy,” says Oliver Morgan, Partner at Deloitte Middle East. The city’s mix of industries, including tourism, finance, and technology, and entrepreneurship provides stability, making it an attractive environment for buyers and investors.
Dubai saw an influx of around 160,000 people in 2023, and by the end of 2024, its population reached 3.8 million, creating a surge in housing demand.
An increasing number of millionaires and high-net-worth individuals are relocating to Dubai, driving the development of more branded residences and reinforcing the city’s reputation as a top-tier place to live.
In fact, Dubai’s residential market has been a key driver of its economic growth, with sales transactions hitting an all-time high in October 2024. Prices have surged, with costs rising 19.4% from the previous peak in 2014. According to Deloitte’s 2025 forecast, a 5% population increase and sustained economic growth will continue to support market expansion.
Despite the upbeat outlook, some experts urge caution. Mario Volpi, Head of Brokerage at Novvi Properties, comments, “We are definitely at the top, but what happens next will determine where we end up.” Volpi notes that continued population growth and the completion of over 1,700 ongoing projects could extend the current property boom well beyond 2027.
The demand-supply imbalance has driven double-digit growth in rental prices across Dubai, with office rents up by 11%, retail rents increasing by 9.7%, and warehouse prices soaring by 21.1%.
This surge underscores the resilience of Dubai’s commercial property market, alongside more commercial developments expected in 2025.
The government’s proactive approach, including property law reforms, tax incentives, and relaxed visa rules, has further enhanced Dubai’s appeal to foreign investors. The introduction of long-term visas has particularly spurred foreign ownership, resulting in more property transactions.
As Dubai’s real estate sector continues to evolve, major infrastructure projects like the expansion of Al Maktoum International Airport and new island developments are further increasing demand.
One of the key attractions for investors is Dubai’s focus on sustainable urban development. As outlined in the Dubai 2040 Urban Master Plan, the city is prioritizing smart city initiatives and expanding its transportation infrastructure. This will improve the city’s liveability, creating more attractive options for both residents and investors.
“The combination of capital appreciation, high rental yields, and increasing foreign investment continues to solidify Dubai’s position as a top-tier global property market,” says Daniel Hadi, CEO of Engel & Völkers Middle East. Hadi further emphasizes that the growth seen in 2024 sets the stage for another record-breaking year in 2025.
With a diversified economy, robust growth prospects, and strong investor interest, Dubai remains a key destination for high-return real estate investments.
