Dubai Property Market Demand Likely To Continue Amid Global Headwinds

As Dubai's residential property market heads towards the final quarter of the year, tourist inflows and an exciting launch pipeline that includes new masterplans are likely to sustain demand, experts say.

“After the usual summer slowdown, demand should reaccelerate, and we expect momentum to build into a strong Q4. New liquidity pockets will support demand, including the introduction of fractional ownership and the legalization of property tokenisation,” Abdullah Al Ajaji, Founder and CEO, Driven Properties, told Khaleej Times.

The global macroeconomic environment is increasingly defined by slower nominal growth, elevated interest rates, rising geopolitical complexity and the transition to multipolarity. The reconfiguration of global capital flows and risk premiums means that investment decisions are no longer governed purely by market fundamentals but are increasingly shaped by national security, trade policy, and fiscal sovereignty.

Amid this repricing, investors are increasingly rotating out of duration-sensitive, low-yielding assets and into real assets with inflation-linked cash flows. Real estate, particularly in transparent, high-growth, and geopolitically insulated jurisdictions, has emerged as a strategic core allocation.

Dubai, underpinned by prudent monetary policy, FX stability, and a reform-oriented regulatory framework, has emerged as a beneficiary of this capital rotation.

The intersection of elevated macro uncertainty, shifting central bank posture, and fiscal asymmetry creates both risk and opportunity.“Real estate, particularly in structurally advantaged jurisdictions such as the UAE, offer a compelling hedge against currency devaluation, policy unpredictability, and public market drawdowns,” an expert said.

Data shows that the Dubai residential market has experienced a significant and sustained rise in transaction volumes, growing from just ~26,891 transactions in H1 2021 to a record ~99,146 in H1 2025, a nearly fourfold rise in just four years. Each year from 2021 to 2025, Q2 transaction volumes have outpaced Q1, indicating a seasonal trend where buying activity accelerates in the second quarter, according to a recent report by Driven properties and Forbes.

The consistent Q2 strength also suggests healthy pipeline absorption, where new launches are being quickly taken up by a market with deep demand. With over 99,000 residential transactions in just the first half of 2025, Dubai has reached a new benchmark of market liquidity.

This underscores the emirate's transition from a cyclical, speculation-driven market to a more institutionalised, diversified, and end-user-driven landscape.

Importantly, it reflects strong investor sentiment despite global economic headwinds.

Within the emirate, Jumeirah Village Circle (JVC) stood out in Q2 2025 with 4,870 transactions, more than any other community, underscoring its appeal as a well-supplied, affordable hub attracting both investors and residents. Other emerging areas like Damac Island City, Dubailand Residence Complex, and Dubai Production City (IMPZ) also performed strongly, reflecting shifting buyer preferences toward value-driven, lifestyle-oriented developments. Meanwhile, prime areas such as Business Bay and Dubai Marina continued to demonstrate resilience, driven by rental yields, central locations, and long-term capital appreciation prospects.“This blend of demand across both mature and emerging zones highlights Dubai's growing market depth, offering opportunities for a wide spectrum of investors and end-users,” the report said.

“Market depth has improved, and leverage remains low, so we don't anticipate sharp swings or large dips. Instead, expect small, steady growth and resilient pricing. We currently see more cash than mortgage buyers and expect the same through the rest of the year. The ultraluxury market should again outperform others, as international buyers pursue rare properties with distinctive design and strong amenities. We expect the year to finish with a disciplined, healthy market,” Al Ajaji said.

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