“With off-plan transactions now more than double those in the secondary market, Dubai's residential market is becoming increasingly investor-driven,” says Prathyusha Gurrapu, Head of Research & Consulting at Cushman & Wakefield Core.
This trend, she says, is pricing a segment of end-users out of the market, as off-plan activity becomes skewed toward investors.
“Rising inflation and growing affordability challenges, particularly in the rental market, are driving a shift toward suburban areas and the Northern Emirates,” Prathyusha Gurrapu said.
According to Cushman & Wakefield Core’s annual report, 2024 was a landmark year for Dubai’s real estate market, which saw unprecedented demand in both the residential and office sectors.
City-wide sales prices surged by 18% year-on-year (YoY), marking 18 consecutive quarters of growth and entering a fifth year of sustained upward momentum. Villa prices rose by 20% YoY, outperforming apartments, which increased by 18%.
The highest gains were seen in Arabian Ranches (29%) and The Springs & The Meadows (28%), while ultra-prime villa districts like Palm Jumeirah (9%) and Emirates Hills (7%) experienced single-digit growth. Jumeirah Village Circle (22%) and Dubai South (22%) saw sharp price increases, largely driven by the Al Maktoum Airport expansion announcement.
As supply struggles to keep pace, the market is seeing record-breaking growth in rents, prices, and transaction volumes. At 16% YoY, rents have risen for the 16th consecutive quarter. Villa rents increased by 13%, while apartment rents surged by 16%, driven by high occupancy levels and population growth.
Jumeirah Village Circle led villa rental growth with a 48% increase, while The Springs and The Meadows saw a 10% rise. In contrast, Palm Jumeirah villa rents declined by 5%, indicating a stabilisation in its ultra-prime rental market. In the apartment segment, Discovery Gardens recorded the highest rental growth at 20%, followed by Downtown Dubai at 17%.
The report highlights supply constraints, noting that only 30,200 residential units were handed over in 2024, 11% below forecasts and 30% lower than 2023. However, 2025 is expected to see a 41% surge in handover volumes, with 42,700 units projected for delivery, likely moderating rent growth.
Contrary to popular perception, Dubai’s real estate market remains price-sensitive, despite its reputation for high-value transactions. Nearly 62% of all transactions were below the Dh2 million mark, while the secondary market was even more price-sensitive, with 39% of transactions below Dh1 million, compared to 26% in the off-plan market.
Looking ahead, Prathyusha Gurrupu said Dubai’s real estate market is expected to maintain its upward trajectory in 2025, though price and rent growth is expected to moderate with increased supply and the new RERA Rental Index.