Dubai’s residential market to stabilise; prices, rents to ease with 243,000 new properties to come

Dubai’s residential property market supply looks strong, with 243,000 new units in the pipeline for delivery. This will stabilise prices and rents and ease pressure on tenants.

According to real estate advisory and property consultancy Cavendish Maxwell, these units will be delivered by the end of 2027, with apartments accounting for 80 per cent of the future inventory.

It noted that the future supply table is topped by Jumeirah Village Circle, where almost 25,000 units are set to be delivered between now and 2027, followed by Business Bay (16,000), Azizi Venice (13,500), Damac Lagoons (11,100) and Arjan (9,000).

The areas with the largest upcoming supply, with 2,000-plus units on the way, include Palm Jumeirah, Dubai Hills, Dubai Marina, Jumeirah Village Circle and Triangle, Al Furjan, Dubai Silicon Oasis, Town Square, and Studio City.

These new handovers are expected to slow down price increases and reduce rental increases, which have been at double-digit rates over the past four years due to high demand.

Interestingly, January 2025 marked the first monthly price decline in over two years as average property prices dipped by 0.57 per cent.

“Despite this slight correction, the market remains robust… This price adjustment remains a positive sign for the market’s long-term health. For a market to grow sustainably, periods of consolidation are needed. This phase allows the market to recalibrate and align with underlying economic fundamentals, ensuring that the market does not enter a bubble phase,” said Ray Verma, luxury broker at Eden Realty UAE.

Dubai has also seen the start of 2025 on a positive note, with projects worth billions of dirhams being grabbed by investors and end-users within hours and days. In the past few weeks, off-plan projects have been launched regularly, averaging one per day.

400 units launched every day

Cavendish Maxwell data showed that Dubai’s residential property markets recorded 145,000 new off-plan unit launches last year, averaging 400 per day, as unprecedented demand prompted local developers to launch new projects and attract foreign developers.

Emaar, Binghatti and Damac led the new launch market in terms of both units released and sales value in the off-plan segment.

“These impressive figures are not just the result of the recovery from the pandemic. They reflect a strong, stable property market that has seen consistent growth since 2022, driven by continued international demand from India, China and other Middle Eastern countries in particular,” said Ronan Arthur, MRICS, partner and head of residential valuation at Cavendish Maxwell.

“While Dubai’s residential market remains extremely robust, with further growth expected in 2025, there are now signs of an adjustment to more sustainable levels. As with previous market cycles, the emirate’s regulators, developers and investors are taking the right steps to avoid runaway growth, which, as we have seen before, could threaten market stability,” he said.

According to Cavendish Maxwell, Mohammed Bin Rashid City saw the highest number of units delivered in 2024, with 5,300 new homes, followed by Jumeirah Village Circle (4,800), Business Bay (2,800), Al Furjan (2,600) and Rukan, Dubailand (1,500).

This article is originally published in Khaleej Times.