The Dubai real estate market is poised for a period of stabilisation in 2025, with rent hikes expected to slow down significantly. Industry experts attribute this trend to a surge in new property completions and the implementation of the smart rental index, which is designed to introduce greater transparency and accuracy in pricing.
A Shift Towards Market Stability
The introduction of the smart rental index is expected to bring more data-driven pricing mechanisms to Dubai’s rental market. This initiative will help both landlords and tenants make more informed decisions by offering real-time market insights. The increased property supply in the coming year will also ease rental price escalations, making housing more accessible and affordable for residents.
“The new index, combined with a record-breaking supply of new units, is expected to temper the rapid price growth seen in recent years,” said a spokesperson from real estate brokerage Betterhomes. “This will create a more balanced and sustainable rental environment for Dubai’s real estate sector.”
A Record Year for Property Completions
2025 is set to witness an unprecedented influx of over 72,300 residential units, marking a 171% increase from the 27,000 units delivered in 2024. This surge in supply is largely driven by pre-sales from 2022 to 2023, as developers ramped up construction to meet the surging demand.
According to Rupert Simmonds, Director of Leasing at Betterhomes, rent increases already showed signs of slowing in 2024, indicating early market stabilisation. He further noted that with an estimated 163,000 new housing units expected between 2025 and 2026, Dubai’s property prices are likely to remain stable through 2026, as supply and demand reach a more balanced state.
Impact on Investors and Market Trends
Dubai’s real estate market remains resilient, bolstered by strong economic growth and continued global investor interest. While some minor price adjustments may occur, the fundamentals of Dubai’s property sector—such as infrastructure expansion, economic diversification, and investor-friendly regulations—will ensure sustained confidence in the market.
“The stabilisation of property prices, coupled with robust global demand, reinforces Dubai’s position as a premier real estate hub,” said Christopher Cina, Director for Development Sales and Consultancy at Betterhomes.
Key Market Developments in 2025:
- Over 9,000 new units will be handed over in Q1 alone, with key areas such as Sobha Hartland, Arjan, and JVC accounting for 41% of this inventory.
- The UAE government has introduced stricter mortgage financing policies to prevent overheating in the market, including restrictions on financing the 4% Dubai Land Department (DLD) fee and 2% brokerage fee.
- Prominent locations such as Jumeirah Village Circle (JVC), Mohammed Bin Rashid City (MBR City), and Business Bay remain high-demand areas for both investors and end-users.
Dubai’s 2024 Real Estate Performance
The year 2024 saw the launch of over 470 new projects, averaging nearly one new development per day. However, due to unforeseen delays, only 27,000 units were delivered—lower than initially anticipated.
- 77% of the units delivered in 2024 were apartments, reinforcing Dubai’s preference for high-rise living.
- 17% were townhouses, while 6% were villas, catering to growing family and luxury markets.
- JVC, MBR City, and Business Bay emerged as the top-performing communities, attracting significant buyer interest and driving most of the year’s completions.
Contact Information:
Blue Shark Real Estate
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