Dubai Property Market Q2 2025: Prices Continue to Rise Amid Strong Off-Plan Demand
The Dubai real estate market sustained its upward momentum in Q2 2025, although the pace of growth moderated compared to the first quarter. According to the latest ValuStrat Price Index (VPI), home values increased by 4.7% in Q2, slightly lower than the 5% growth recorded in Q1. On a year-on-year basis, however, prices remain up by nearly 24% — more than double their levels in early 2021.
Haider Tuaima, Managing Director & Head of Real Estate Research at ValuStrat, noted that as new supply enters the market in the second half of the year, it will be important to watch how pricing trends evolve. Nonetheless, the outlook across the residential, office, and industrial sectors remains positive, supported by strong demand fundamentals.
Villas Lead Price Growth
Villas remain the top-performing segment in Dubai’s property market. Average villa prices jumped by an impressive 28.7% year-on-year, with some communities recording remarkable gains since 2021:
- Jumeirah Islands: +284%
- Palm Jumeirah: +248.6%
- Arabian Ranches: +201.1%
In Q2 2025 alone, villa prices saw notable quarterly increases: Jumeirah Islands and Palm Jumeirah rose by 8.5%, Emirates Hills and The Meadows climbed by 5.5%, while Mudon posted a more modest 2.1% gain. Despite signs of growth cooling, prime villa communities remain highly sought after, attracting both domestic and international buyers seeking exclusive addresses.
Apartment Prices Show Slower but Steady Growth
Apartment values rose by 3.4% in Q2 and are up 19.1% year-on-year. Areas with the strongest quarterly gains include:
- Remraam: +5.4%
- Dubai Silicon Oasis: +5%
- The Greens & Town Square: +4.5%
- Palm Jumeirah: +4.2%
Slower growth was recorded in Dubai Marina (+2.9%) and International City (+2.3%), offering some relief for buyers and tenants in those areas.
Rental Market Trends
Rental rates continued to edge higher, but at a more moderate pace compared to the sharp increases seen in previous years:
- Overall rents: +1% QoQ, +6.2% YoY
- Villa rents: Flat QoQ, +4.8% YoY (average AED 428,000)
- Apartment rents: +1.2% QoQ, +7.2% YoY (average AED 95,500)
Average annual asking rents by unit type:
- Studio: AED 64,000
- 1-bedroom: AED 91,000
- 2-bedroom: AED 131,000
- 3-bedroom: AED 191,000
For villas, average rents stand at AED 335,000 for three-bedroom units, AED 426,000 for four-bedrooms, and AED 522,000 for five-bedrooms. These figures highlight the premium associated with larger homes in prime locations such as Arabian Ranches and Emirates Hills.
More Supply Coming to the Market
Buyers and renters may soon see increased choice. Over 17,000 homes have already been completed in 2025, and a total of 66,596 units are expected by year-end — 65% apartments and 35% villas and townhouses.
Recent handovers include:
- Jumeirah Village Circle (JVC): 1,160 units
- Arjan: 1,029 units
- Dubai Science Park: 575 units
- Tilal Al Ghaf (Aura): 808 villas
- Damac Lagoons (Portofino 2): 61 villas
Looking ahead, nearly 200,000 homes are planned for delivery by 2029, signalling a strong pipeline that could help balance demand and supply over the coming years.
Off-Plan Market Hits Record Levels
Despite rising prices, buyer interest in off-plan projects is at an all-time high. Q2 2025 saw over 35,700 off-plan transactions — up 24% quarter-on-quarter and 43% year-on-year — with a total value of AED 113 billion. The average transaction price reached AED 3.2 million, representing a 32% increase from last year.
Top-performing off-plan locations include:
- JVC: 9.5% of total off-plan deals
- Damac Islands: 7.5%
- Business Bay: 5%
The secondary market also remained robust, with 13,691 resale deals completed in Q2, nearly 36.4% of which were priced under AED 1 million. These properties continue to serve as key entry points for budget-conscious investors.
Outlook for the Rest of 2025
While growth rates are moderating in certain segments, Dubai’s property market remains underpinned by strong fundamentals, investor confidence, and global appeal. The continued influx of high-net-worth individuals, government-led infrastructure projects, and a diversified economy position the emirate for sustainable real estate performance in the medium term.
Investors are encouraged to monitor upcoming project launches and consider established high-demand areas such as Dubai Marina, Palm Jumeirah, and Business Bay when seeking both capital growth and rental yield opportunities.
