Dubai’s real estate market has witnessed a significant transformation in 2024 and early 2025, with a sharp decline in prime property listings as more end-users enter the market. According to the latest report by real estate consultancy Knight Frank, the number of homes available for sale in Dubai fell by 30%, with the prime market experiencing an even greater reduction of over 50% in home listings. This shift is largely driven by an increasing number of residents opting for homeownership due to rising rental prices.

End-Users Driving Market Trends

Unlike previous market cycles dominated by speculative investors, the current demand is led by genuine end-users. Faisal Durrani, Partner and Head of Research for MENA at Knight Frank, highlighted that the drop in property listings is a reflection of the changing buyer profile, with more long-term homeowners entering the market.

Dubai’s rental market has seen a significant surge, pushing many tenants to transition to homeownership. Real estate consultancy Asteco reported that apartment and villa rental prices rose by approximately 2-3% in Q4 2024. This shift has resulted in a 30% decline in month-on-month rental renewals as more residents choose to buy properties instead of continuing to rent.

Luxury Market Sees Record Demand

Dubai’s luxury real estate market has solidified its position as a global safe haven for ultra-high-net-worth individuals (UHNWIs). Knight Frank’s data revealed a substantial decline in the availability of high-end properties:

  • Homes priced at $10 million or more: Listings dropped by 40%, from 4,119 to 2,491 properties.
  • Homes priced at $25 million or more: A staggering 85% drop, from 583 to just 86 available units.

Petri Mannila, Partner for Prime Residential at Knight Frank, stated that the continuous demand for luxury homes, coupled with limited supply, has led to record-breaking prices, reaching AED 6,627 per square foot in Q4 2024. The market also recorded 435 transactions for homes above $10 million in 2024, with 153 of those sales occurring in Q4 alone—the highest quarterly figure ever recorded for this segment.

Dubai’s Population Growth & Housing Supply

Dubai’s population continues to grow at a rapid pace, with nearly 27,000 new residents added in the first two months of 2025, pushing the city’s population to 3.852 million. This influx is fueling demand across all real estate sectors.

To meet this rising demand, 302,880 residential units are currently under construction, with 80% consisting of apartments and the remaining 20% comprising villas and branded residences. According to Knight Frank, Dubai is set to deliver approximately 60,576 new homes annually over the next five years—significantly higher than the historical average of 36,000 units per year. However, past trends indicate a 30% delay in completion timelines, meaning that actual delivery might fall short of projections.

Future Outlook: Market Stabilization Ahead?

While Dubai’s real estate market remains strong, experts predict stabilization in the coming years. Cavendish Maxwell reports that 243,000 new units are scheduled for delivery by the end of 2027, with Jumeirah Village Circle (JVC) leading in new developments. This surge in supply is expected to ease price pressures, making homeownership more accessible while offering relief to tenants facing soaring rental rates.

Farooq Syed, CEO of Springfield Properties, emphasized that Dubai’s real estate sector is built on strong long-term fundamentals. The emirate’s ability to attract global investors, combined with strategic regulatory initiatives, ensures sustained demand across all property segments.

Conclusion

Dubai’s real estate market is undergoing a major shift, with end-users driving demand and luxury property listings dwindling. The city’s appeal to high-net-worth individuals, coupled with its growing population, has pushed property values higher, while new supply is expected to gradually stabilize the market. As Dubai continues to evolve as a global real estate hub, 2025 will be a crucial year in shaping its property landscape.

For more insights on Dubai’s real estate market and investment opportunities, stay updated with GCC Real Estate.