Dubai Property Prices and Market Outlook Early 2025

After a prolonged period of robust growth, Dubai's real estate market is showing signs of stabilization as it enters 2025. The latest data reveals a nuanced shift in trends, indicating a market that is maturing and responding to a complex interplay of factors.

Price Dynamics: A Turn Towards Moderation

For the first time in over two years, Dubai’s property prices experienced a month-on-month decline of 0.57% in January 2025, with prices averaging AED 1,484 per square foot. This moderation follows a period of decelerating price growth in the latter months of 2024, suggesting that the market may be reaching a plateau. While this decline is modest, it signals a potential shift in the market's trajectory, as affordability constraints begin to exert pressure, particularly in the ready market. 

Transaction Volumes: Strong Yet Cooling

The total number of sales transactions declined by 4.6% in January, reaching 14,413. However, despite this dip, it still stands as the highest transaction volume ever recorded for the month of January. The overall trend indicates that after peaking in October 2024, sales activity is normalizing to more sustainable levels.   

Off-Plan Market: Still a Driving Force

The off-plan market continues to be a significant driver, with 7,555 Oqood transactions recorded in January. Off-plan launches continue to soar with 53 launches bringing over 12,400 units to market in January. Although the Oqood transactions represent a 17.7% decrease from the previous month, they still constitute a majority (52.4%) of the market share. Adjusting for technicalities in Title Deed sales, the off-plan market's share is even more substantial, at 67.6%.   

Resale Market: Gradual Expansion

Resale transactions accounted for 38.6% of the market in January, with 5,561 transactions. This marks a 1.7% increase month-on-month. Off-plan resale activity is also on a gradual rise, concentrated mainly in properties nearing completion. However, there's a subtle indication of increased speculation, with resale activity slowly extending to properties further from handover. 

Mortgage Market: Stable Amidst Regulations

Mortgage transaction volumes increased by 6.8% in January with a total of 4,134 loans recorded. The market has so far remained resilient to the UAE Central Bank's stricter enforcement of regulations on mortgage amounts, but this could pose affordability challenges in the near future.   

Market Outlook: Balanced Growth

The Dubai real estate market's long-term health hinges on maintaining a balance between supply and demand. Government initiatives such as the Dubai Economic Agenda (D33) and the Real Estate Sector Strategy 2033 provide long-term confidence, but as the market matures, a shift toward stability over rapid gains is expected.   

Key Facts:

✔️ Median prices in January 2025

• Apartments: AED 1,350,000   
• Townhouses: AED 2,671,000   
• Villas: AED 6,915,888   

✔️ Highest recorded sale: AED 425M (Villa, Sector E, Emirates Hills)   

✔️ Lowest recorded sale: AED 175K (Studio Apartment, Lakeside Tower A, Dubai Production City)   

✔️ Off-plan launches: 53 launches, bringing over 12,400 units to market   

✔️ Dynamic Price Index: Current Property Price - AED 1,484/sq ft   

Source: Property Monitor

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