Dubai Real Estate Market Report Q1 2025

Dubai’s property market has made a very strong start which is backed by robust demand, rising prices, and substantially standout performers. What makes Dubai’s real estate market getting such a healthy backing in terms of performances, well, the Q1 data of 2025 is such satisfactory in itself that everything becomes praiseworthy for the city’s real estate market. What;s more interesting about this performance is that whether you’re a seasoned investor or a first-time buyer, there’s something to learn from how the city’s market has performed in the first quarter of 2025. So, let’s jump in and see how the performances hold on to various parameters one by one, and get the prices, demand and supply insights along the way.

Sales Volume & Value: Q1 Breaks New Ground

The sales volumes in Q1 saw a surge and rose by 24%. Such a rise is sufficient to underline the fact that the market is perfectly laid for a continued momentum in the quarters to come by in this year. Moreover, if we compare it to Q4 of 2024, the transaction volume held steady with a slight uptick of 3%, again showcasing the resilience despite the global economic slowdowns. Another positive and impressive data is that total sales value jumped by 31% YoY, which signals higher than the average ticket deals and growing investor appetite.

Dubai's property market has continued its vigorous activity into the first quarter of 2025, showcasing robust growth and enduring investor confidence. Let’s look into the overall market performance breakdown in a nutshell to get an idea of the numbers game.

Significant Sales Growth: Total sales transactions surged by 23% compared to the same period in the previous year.

• High Transaction Volume: A notable 42,422 deals were recorded in Q1 2025.
• Sustained Demand: This year-on-year growth underscores the continued high demand for property across the emirate.
• Seasonal Adjustment: When compared to the exceptionally active final quarter of 2024, Q1 2025 transaction volumes saw a 10% decline, reflecting typical seasonal market adjustments.

Spotlight on the Off-Plan Sector:

• Major Contributor: The off-plan sector played a crucial role in the market's Q1 performance.
• Impressive Transaction Numbers: Off-plan transactions reached 24,942.
• Strong Year-on-Year Increase: This represents a 25% increase in off-plan sales compared to Q1 2024.
• Dominant Market Share: Off-plan deals accounted for a significant 59% of all real estate transactions in the first quarter.
• Enduring Appeal: The strong performance of the off-plan sector highlights the lasting attraction of new developments and their increasing influence on overall market activity.

Off-Plan Vs the Secondary Market standings

The below graph lays down the data of how the off-plan properties have had a strong hold over the secondary offerings. It is also a clear cut reflection of how much confidence the investors are showing in Dubai’s real estate with respect to the long-term investments. They seem to be more than willing to wait to get the returns they’re aiming for from Dubai’s growing market.

The Picture beyond numbers: Off-Plan Vs Secondary

Although the secondary market hasn’t been that far with what we can see from the numbers of Q1 2025. Though they lag behind the off-plan market, and there’s a pretty healthy gap of around 16-17% which is quite substantial, but still it seems like there are still many who are seeking for and tilted towards immediate returns and slightly more stability.

The fact that the secondary market gives options of inspecting the layout and property condition to determine how much stability would be there if you invest in them, it’s quite compelling and gives an edge to the secondary market as compared to the Off-plan. Moreover, being a tangible asset, unlike Off-plan, there is always an option of immediate occupancy which the buyer can use to either move in, or rent it out as a secondary property straight away.

Different property types have shown different transactional trends within the property market. Townhouses, apartments, and Villas have all shown varying trends across the years. Going by the same lines, the first quarter hasn’t been that different in terms of how the transactions of property type have panned out in Dubai’s real estate market.

The below graph shows how the sales have been for apartments, townhouses, and Villas in Q1 2025.

Now let's see how the off-plan properties have performed compared to the secondary market based on different property types (apartments, villas, & townhouses). Also, these graphs will showcase how these property types have had their sales in notable locations of Dubai.

Apartments

Dubai real estate in Q1 2025 has seen soaring sales, strong yields. It’s been a haven for investors who are cashing in on the boom. Q1 2025 saw property values climb and rents rise, making Dubai a hotspot for lucrative real estate investments. With around over AED 142 billion in sales and high rental demand, Dubai's property market is proving to be a rewarding bet for investors.

ROI Hotspots: Where Returns Are Rising

There are certain areas that have consistently outperformed when it comes to return on investment (ROI), and the numbers they carry certainly don’t lie :

• Jumeirah Village Circle (JVC) leads the pack with an impressive 7.5% average gross yield, thanks to affordable entry prices and high rental demand.
• A very strong ROI levels are sustained and carried by Dubai Silicon Oasis and Arjan, which are around 6.8%. These returns are quite appealing to mid-tier investors who are looking for some reliable income streams.
• Meanwhile, Palm Jumeirah and Downtown Dubai focused more on capital appreciation. These locations are more targeted towards delivering ROI in the range of 4–5% but with steady price climbs, posing much stability as an option to the investors.

Yield Comparisons

Apartments continued to outperform villas in rental yield. Let’s see the numbers to see how strongly the apartments have dominated the Vilaas:

• Apartments: They offer an average yield of around 6.5% across the city. Dubai Marina and Business Bay are the two communities that have outperformed any other location, and remained the standout performers with exceptional apartment options..
• Villas: The average yield of Villas is around 4.2%, but certain luxury pockets like Arabian Ranches offer premium lifestyle value, and presents a balance of lower yields with strong resale prospects.

The trends in property pricing have always seen a pattern in which the luxury segments, Villas and other premium categories have shot up on a YoY basis. Let’s dive in to see how the pricing trends have been in the Q1 of 2025, along with which areas and builders have showcased themselves in the list of top performers.

Apartments vs Villas, Off-Plan vs Ready

• The apartments, as said above in the yields section, remain a very steady performer, not just in offering steady yields, but showcasing steady pricing trends as well. With average prices increasing 6% YoY, the apartments have largely been fueled by off-plan launches in hot zones like Business Bay and JVC.
• The villas, however, have continued to outperform the apartments. Their prices are climbing 9% YoY, especially in prime areas such as Dubai Hills Estate and Arabian Ranches III.
• The Off-plan properties remained the top choice for value-driven buyers. They have witnessed a strong 35% share in total transactions. It shows that not just in the total sales by value and volume, the Off-Plan properties goes past the secondary market in pricing trends as well. Though, the ready units (secondary market) catered more to end-users who are seeking immediate occupancy.

If we look at the average sales price per sq ft ( AED) of the past two years and the Q1 of 2025, it’s clear that this year, the Dubai real estate market is seeing a substantial jump compared to how the average prices were in 2023 

Top Performing Areas in Q1 2025

To see which areas performed well, the average sales price (AED per sq ft) is considered. The table below shows that some neighborhoods clearly stole the spotlight and remained investors' favorites:

Top Performing Builders (2024 & 2025)

Dubai is one of the top locations in the world that not just attracts tourists from across the globe, but investors also eye towards this iconic location to make some healthy bucks. Though, investors soak in from all parts of the world into Dubai for investments, but recent data has shown some pretty interesting figures. 

Let’s dive into the recent figures about the nationalities that are pouring in for investing into Dubai's real estate market. The below graph shows the comparative representation of the market share of Dubai by nationality in 2024 and 2025.

Top Foreign Investors in Dubai Real Estate in 2025 

1. Indian Nationals: 

• Market share up: 21% ➔ 22%
• Key drivers: Tax-free perks, stable economy, rupee depreciation = Gains from Dollar being pegged 
• Focus: Wealth preservation + high yields

2. British Nationals: Solid & Steady

• Market share: 17%
• Why Dubai: High UK inflation & interest rates push buyers to Dubai
• Hot picks: Properties for strong rental income (short + long term)

3. Chinese Nationals: Fast-Rising Players

• Market share: 14%
• Key drivers: Belt & Road ties, Golden Visa lure
• Strategy: Diversifying with Dubai real estate

4. Saudi Nationals: Cultural & Premium Focus

• Market share: 11%
• Drivers: Easy access, economic diversification
• Preference: High-end homes (Downtown, Palm Jumeirah)

5. Russian Nationals: Luxury Lovers

• Market share: 9%
• Why Dubai: Safe-haven appeal amid home-country uncertainties
• Focus: Luxury segment + visa-friendly advantages

Foreign Nationals: Who’s Buying Where?

• European and Russian investors - They remained highly inclined towards the luxury market. To be precise, they remained more active for the branded residences, especially the waterfront ones.
• South Asian buyers - They focused more on the mid-market communities which are on the tracks to emerge as the communities that feature in the major league. And, by major league it means that these mid-market communities have potential to be ticked by most of the big buyers and investors one day.One of the major reason for them to be highly potent  is the fact that these mid-market communities are not just affordable, but also possess strong demand in terms if getting leased out
• Chinese Investment - The Chinese investment also saw visibly sturdy improvements, particularly with respect to the Off-plan projects having attractive payment plans.

Dubai’s government continues to roll out pro-investor initiatives that are paying off. There is a strong will of the government to pull as much demand as possible, which in turn pushes investor confidence. Every year, its real estate market sees rising trends with some slight shivering drifts, which are mostly seasonal; they zone out pretty quickly and aren’t that significant in terms of downgrading the entire optimistic run.

Let’s look at what Dubai has done concerning policy making and implementation:

• The 10-year Golden Visa remains a key driver, especially for high-net-worth individuals.
• Recent reforms in property ownership for foreigners have opened up new freehold zones, widening the investment playing field.
• Additionally, there have been some other continuous upgrades, like new metro links and mega-projects. They also help in reshaping ROI dynamics in emerging communities.

Investor Takeaway

Money in Q1 2025 so far is flowing pretty smartly towards the areas that are grabbing hold of a mix of high yields and future-proof infrastructures backed by supportive government policies. Even if your objective is to get an immediate rental income or long-term capital growth, Dubai continues to offer some of the world’s most exciting property investment opportunities.

Every market has its implications on how the economy surrounding or involved with it will perform at the same time. So, in case of the market dynamics involved with the Dubai real estate market’s performance in Q1 2025 also has their tone. Let’s see how the economy has reacted to the market performance and changes one by one.

1. The steady influx of international buyers highlights that Dubai’s market is quite resilient, and that is one of the key drivers of Dubai’s sustained economic vitality.
2. The demand from foreign nations has been so robust that it has significantly boosted transaction volumes and property values. Having such promising demand, the residential sales reached around AED 120 billion in Q1 2025. This figure is up from AED 110 billion in the same period of 2024.
3. Both new and seasoned investors are fueling the market’s growth. Dubai’s broader economic development has been pushed up to a very substantial level by real estate’s optimistic performance over the years. A similar critical role is what Dubai's real estate market performance in Q1 2025 has done to the city’s upscaling economy.

The numbers shown by Dubai’s real estate market in Q1 2025 have been so confident, it seems like the city will keep driving this positive momentum across other key sectors and segments as well. Looking ahead now, the developers would also be a bit on the aggressive side in launching the fresh projects, focusing more on the lifestyle-oriented and branded communities. The overall indicators of Q1 2025 point towards a very balanced yet dynamic market for the rest of the year. To get the most relevant and credible real estate information, follow and reach out to Dubai Housing.