Dubai’s property markets continue to grow and attract foreign investment

As one of the world’s best-performing property markets, Dubai continued to shine on the global stage, reporting a 41% increase in sales figures and a 28% growth in sales volumes. According to the market insights and property data portal DXB Interact, the value of property transactions in the leading Emirate reached a record AED 197.5bn in the 12 months to April 2025. With over 61,300 units successfully sold, the average price per square foot increased by 4% to AED 1,600.

The record-level figures highlight the growing confidence of local and overseas homebuyers in Dubai’s vibrant and thriving property market. Strong buyer demand, strategic investments in infrastructure upgrades, and the city’s appeal as a vibrant business and lifestyle destination have further added to this growth.

Apartments remain the most popular choice

With nearly 33,000 property transactions in Q1 2025, apartments were the most sought-after property type, growing by 12.6% from Q1 2024. With total transactions valued at AED 62.3bn, apartments attract homebuyers and investors seeking affordable luxury and robust rental yields. Proximity to leading commercial hubs and the best lifestyle amenities saw demand soar in established zones like Dubai Marina, Downtown Dubai, and Business Bay.

High growth in villa sales

Villas came in second with nearly 8,400 transactions in Q1 2025. At a valuation of 43.1bn, villa sales recorded a 43.1% growth from Q1 2024. This growth reflects a broader trend wherein buyers seek more space and private living experiences. These properties are favoured mainly by high-net-worth buyers looking to acquire luxurious villas in master-plan communities such as Arabian Ranches, Palm Jumeirah, and Dubai Hills.

Top-performing areas for property sales in Q1 2025

High-value property purchases

While the most expensive villa in Q1 was sold for AED 140m in Dubai Hills Estate, the costliest apartment in the high-end Jumeirah 2 neighbourhood fetched AED 116m. Although the market for high-value properties costing over AED 5m has grown considerably over the years, it still only accounts for 9% of the total sales volume. Most property transactions were in the mid-market segment, with properties priced between AED 1m and AED 2m contributing to 31% of sales and affordable properties priced below AED 1m accounting for 26% of sales.

High demand for new/off-plan properties

Several factors, such as fresh warranties, flexible payment plans and cutting-edge facilities, supported demand for brand-new and off-plan properties, which continued to dominate the market in Q1. With a market share of 65% of all transactions, new-build and off-plan properties accounted for 61% of the total sales value.

However, those seeking immediate occupancy in established neighbourhoods chose to buy resale properties, contributing 35% of the total sales volume and 31% of the sales value.

Rents to get a boost in 2025

According to estimates from the Dubai Land Department, short-term rents (less than 12 months) in the city will likely rise by 18% before the end of the year, while long-term leases (more than 12 months) could increase by 13%. Rent growth in Dubai is primarily driven by continued population growth, which is expected to reach four million by the end of 2025. Within the rental sector, demand for one-bed apartments is the highest (41%), followed by two-bedroom units (24%) and studios (21%).

Here’s a breakdown of the areas that saw the highest volume of rental contracts in Dubai.

Market outlook – Strong growth expected driven by high demand

A growing expat population, flourishing economy, world-class infrastructure and lucrative rental yields have led investors and homebuyers worldwide to buy properties in Dubai. Furthermore, the Emirate’s thriving tourism sector, pro-business environment and attractive tax policies make it a desirable investment destination for local and overseas property buyers.