Dubai house prices to rise 8% by 2025

Commercial real estate agency Knight Frank expects Dubai house prices to rise by 8% in 2025, driven by demand and weak supply. This is expected in the Dubai Property Market Review report, which showed that house prices will see a modest increase of 5% next year, compared to a 6% increase in 2024.

High demand and falling supply

The report indicated that Dubai’s real estate market continues to record guarantees, as it remained at a rate of 19.9% ​​compared to last year. This includes luxury homes by 52% over the 12 months, with a 65% decrease in homes set at $10 million.

Meanwhile, real estate transactions hit a record high during the third sector in 2024, averaging €47,269, up 41.8% compared to the same period in 2023. The total average value between January and September 2024 was AED306.3 billion, up 36% from the previous year.

Supply challenges

Developers are responding, causing problems in fillers. It is estimated that approximately 8,900 villas will be delivered by the end of 2024 and 19,700 villas by the end of 2025. Nearly 300,000 residential units are expected to be delivered by 2029, most of which will be apartments at 80.1%, while villas are spread out at only 17.4%.

Once again

Knight Frank identifies several people who may be in the Dubai real estate market, including:

Global economic dynamism: could lead to a change in population growth and weak market confidence.

Volatile oil prices: could affect government innovation and economic growth.

Contract #4: Despite not stopping from other Gulf cities, Dubai remains a major commercial and tourism hub.

Sustainable growth

“After five years of strong growth, we are starting to see new customer growth through 2025. However, we will continue to see new growth, supported by strong demand and low supply,” said Faisal Dominic, head of research in the Middle East at Knight Frank.

He added that villas in prime locations such as Palm Jumeirah and Jumeirah Islands have performed the best, with current values ​​and 2014 levels.

Real estate wealth

Consider Knight Frank’s analysis that the number of homes over $1 million has increased from 6.3% of total sales in 2020 to 18.1% today. The value of these places amounts to 822 billion dirhams, which reflects the increased concentration of everyone in the Dubai real estate market.