After two years of non-stop price hikes, Dubai’s real estate market has recorded its first dip, signaling a possible shift toward stabilization. According to the latest Property Monitor report, prices fell by 0.57% in January 2025, marking the first decline since summer 2022.
Despite this, transaction levels remained strong, with 14,413 sales recorded in January, making it the highest-performing January on record. However, sales volumes were down 4.6% compared to December 2024, raising questions about whether the market is starting to cool.
A Market in Transition?
While prices dipped, Dubai’s off-plan sector remained a powerhouse. January saw 53 new project launches from 37 developers, adding 12,400 more units to the market. Mortgage transactions also rose by 6.8% month-on-month, showing that buyer demand is still present, despite stricter lending regulations.
Zhann Jochinke, COO of Property Monitor, weighed in on the market shift:
“After four years of continuous growth, Dubai’s real estate market is starting to show signs of stabilisation. While transactions remain strong, affordability constraints and market maturity are beginning to shape the landscape.”
He noted that as sales volumes and mortgage transactions moderate, the market could be transitioning from rapid expansion to a more balanced, sustainable phase.
Latest Real Estate Trends
According to the report, property prices across different segments varied:
- Apartments: AED 1.35M ($368K) median price
- Townhouses: AED 2.61M ($711K) median price
- Villas: AED 6.91M ($1.9M) median price
Off-plan sales remained dominant, accounting for 52% of all transactions in January—though this was down 17.7% from December. Meanwhile, title deed sales saw a sharp 15.7% month-on-month increase, taking up 47.6% of total sales.
Emaar Properties led off-plan sales with a 16.5% market share, followed by DAMAC (15.8%) and Danube (5.3%).
Record-Breaking Deals
Dubai’s ultra-luxury market remains strong, with an Emirates Hills villa selling for AED 425M ($116M)—the highest transaction of the month. On the other end of the spectrum, the most affordable recorded sale was a studio in Dubai Production City for AED 175K ($48K).
What’s Next for Dubai’s Property Market?
With Dubai’s real estate sector surging by 30% year-on-year in 2024, it’s no surprise that the market is now finding a new rhythm. Whether this dip is a temporary fluctuation or the beginning of a broader market shift remains to be seen.
One thing is clear—buyer demand, off-plan launches, and investor confidence remain high. But with more inventory hitting the market and affordability becoming a bigger factor, 2025 could mark the start of a more sustainable and balanced real estate landscape in Dubai.
