Dubai’s property market closed 2025 with strong momentum, driven by resilient demand for ready-to-move-in homes and sharply rising rental rates, according to data from the Annual Dubai Property Market Report.

Market activity broadened across luxury, mid-tier, and affordable segments, rather than overheating, as buyers, tenants, and investors spread their focus across communities of varying price ranges.

Strong Demand for Completed Properties

Ready homes continued to attract solid interest throughout the year, even while off-plan sales gained attention. Completed units offer immediate occupancy, predictable service charges, and strong rental appeal, which made them especially attractive in 2025.

In the luxury apartment segment, Dubai Marina remained one of the most sought-after neighbourhoods for both tenants and investors thanks to its waterfront lifestyle and stable yields. Mid-tier hubs such as Jumeirah Village Circle and affordable zones like International City also recorded heightened interest, with average rents in International City climbing to about Dh53,000 — one of the sharpest increases among budget communities.

Villas and Rental Trends

In the villa market, standalone homes also saw strong demand. Damac Lagoons led luxury villa interest, while Al Furjan and Damac Hills 2 were the top choices in the mid-tier and affordable segments. Rising rental requirements were partly driven by new supply handovers, with mid-tier villa rents in some areas jumping by over 45 percent year-on-year.

Investment Returns and Market Dynamics

Rental returns remained attractive compared with global cities. Mid-tier apartment yields in communities like Town Square were among the highest, while villa returns led overall. Real estate consultants still see solid fundamentals underpinning growth as interest rates are expected to moderate into 2026.

Outlook for 2026

Industry analysts expect market growth to shift toward a more stable and sustainable pace next year, supported by continued population inflows, infrastructure development, and diversified economic activity. Even so, rental demand and population-driven housing needs are likely to keep Dubai among the world’s most active property markets.