From off-plan frenzy to suburban shift: 6 trends defining Dubai real estate

Dubai’s real estate market continues to outperform global counterparts, driven by a unique combination of population growth, strong foreign investment, a booming off-plan segment, and shifting lifestyle preferences in the post-pandemic era.

According to the Dubai Land Department (DLD), approximately 94,700 investors entered the market in the first half of 2025, marking a 26 per cent increase year-on-year. Notably, 59,000 were new investors, and UAE residents accounted for 45 per cent of this cohort, signaling robust domestic demand alongside global interest.

Data from Hudson Real Estate’s Q4 2025 Dubai Real Estate Market Update indicates a solid year across residential segments:

• Residential sales prices rose by 20 per cent year-on-year
• Rental prices surged 19 per cent across key segments

While traditional hot spots like Downtown Dubai and Dubai Marina remain resilient, market momentum is becoming increasingly project-specific.

Broader gains are decelerating, and buyer attention is now focused on differentiated offerings within high-performing developments.

Top performing submarkets: Yields and growth

In Q4, certain communities have emerged as outperformers in terms of capital appreciation and rental yields:

• Arjan: 6.3 per cent price increase, 8.1 per cent estimated gross rental yield
• Jumeirah Village Circle (JVC): 3.4 per cent price increase, 7.3 per cent rental yield
• Dubai Hills Estate: 2.1 per cent price growth, with strong mid-to-premium end-user demand

These areas are attracting investors due to price accessibility and stable rental demand, making them attractive alternatives to the traditional luxury corridors.

Over 80 residential projects have launched across Dubai in 2025. Submarkets such as JVC, Arjan, and Al Furjan are seeing considerable off-plan activity, prompting a need for selectivity among investors.

Meanwhile, master-planned areas like Dubai Hills, Dubai Creek Harbour, and The Oasis continue to effectively absorb new supply. Their integrated amenities and long-term masterplans are proving key to sustained demand.

Rental market: A tale of two segments

Rental dynamics across Dubai remain stable, with high occupancy in most long-term and short-term categories:

• Short-term rentals are averaging 65–72 per cent occupancy across the city
• Long-term leases under Dhs120,000 per year show 88–90 per cent occupancy
• Premium rentals over Dhs300,000 face longer vacancy cycles and slower absorption

Gross yield calculations now require a realistic assessment of vacancy risk and cost structures, particularly in high-end segments.

Dubai’s real estate continues to attract a diverse international buyer base. As of Q4 2025, the top five nationalities investing in Dubai real estate were:

1. India
2. United Kingdom
3. Russia
4. China
5. Saudi Arabia, notably, the fastest-growing segment

GCC-based investors are increasingly targeting family-oriented communities, villas, and branded residences, aligning with the market’s broader lifestyle evolution.

Transaction volumes hit Dhs262bn in H1 2025

Dubai’s residential real estate sector recorded Dhs262.1bn in transactions during the first half of 2025, up 36.4 per cent in value compared to H1 2024.

While the topline figures are impressive, underlying shifts in buyer behavior and developer strategy are even more telling.

Amaal’s research reveals six major trends shaping the city’s real estate market in 2025, with implications for buyers, tenants, and developers alike.

Six structural trends redefining Dubai real estate

1. Off-plan sales take the lead

Off-plan transactions now account for over 70 per cent of all property sales in 2025, a  Flexible payment plans, anticipated appreciation, and confidence in long-term development have tilted the market away from resales, A Cavendish Maxwell report titled, ‘Dubai Residential Market Performance H1 2025‘ conveyed.

Key zones witnessing strong off-plan demand include:

• Mohammed Bin Rashid City
• Dubai South
• Dubai Hills Estate
• Business Bay
• Downtown
• Jumeirah Village Circle

Emerging areas with improved infrastructure such as Dubai Production City, Dubai Silicon Oasis, Dubai Maritime City, and Downtown Jebel Ali are also gaining traction.

“We’re strategically expanding our footprint in these emerging zones, where we see long-term value creation potential,” said Patrick Rouse, Chief Development Officer at Deyaar Development.

2. Suburban shift gains pace

Rising central area rents are pushing residents to suburban locations. Areas like Dubai Silicon Oasis, Jumeirah Village Circle, and Dubai South are evolving into fully serviced lifestyle hubs.

With Dubai’s population now exceeding 3 million, the traditional boundaries of urban demand are expanding rapidly.

3. Wellness is the new standard

Developers are elevating amenities beyond gyms and pools. New projects increasingly include meditation decks, green walkways, co-working lounges, hydrotherapy pools, and pet-friendly zones.

This evolution reflects changing buyer expectations, especially in a hybrid work environment, and is now a defining feature in the mid to premium housing segments.

4. Sustainability drives buying decisions

Sustainability is no longer just a luxury touch. Green certifications like LEED, solar integration, and energy-efficient materials are becoming standard even in mid-market projects.

According to Amaal, sustainable features are increasingly influencing both purchase and rental decisions, particularly among international buyers and ESG-conscious investors.

Properties with smart cooling systems and utility optimization are also seeing reduced vacancy and better retention rates.

5. Rise of mixed-use developments

New projects are prioritising walkable urbanism, with vertical communities that combine residential, commercial, and social infrastructure.

These “vertical villages” offer co-working spaces, cafes, supermarkets, childcare centers, and wellness hubs, promoting a live-work-play ecosystem within the same building or neighborhood.

6. PropTech transforms property access and investment

From AI-enabled platforms to tokenised property investments, technology is revolutionising real estate in Dubai.

International investors from Europe and Asia are using AR/VR home tours, blockchain-based transactions, and predictive pricing tools to remotely shortlist and purchase properties, adding new global liquidity into the market.

While the record-breaking transaction values of 2025 may suggest a market peak, industry leaders argue this is part of a structural shift, not a speculative cycle.

“We are witnessing a long-term recalibration of the UAE’s global position,” said Patrick Rouse of Deyaar. “Dubai is now seen not just as an investment destination but as a place to live, work, and grow.”

The demand is increasingly driven by genuine interest in residency, business expansion, and lifestyle upgrades, not just capital speculation.

Looking head: Quality and vision to drive differentiation

Going forward, sustainability, technology integration, and community-centric planning will be the key differentiators in Dubai’s real estate market.

Developers are being called to raise design standards, enhance service offerings, and prioritize long-term value.

“At Deyaar, we’re aligning our pipeline with evolving buyer preferences. Our focus is on projects that reflect not just where Dubai is today, but where it’s headed,” said Rouse.

Dubai’s real estate market is not just weathering global economic shifts, it is actively transforming through innovation, strategic planning, and a redefined value proposition. With strong domestic and international investor participation, evolving buyer demands, and long-term vision from developers, the city is poised to maintain its upward trajectory well into the future.

This article was originally published in Gulf Business.