Off-Plan Boom And Rising Ownership Fuel Dubai's Property Market Momentum

Dubai's real estate sector has extended its remarkable run through 2025, with new data pointing to a surge in both off-plan and secondary sales as residents and international investors deepen their commitment to the city.

The latest analysis by eXp Dubai shows that transactions climbed 26 per cent in the four months from May to August compared with the first four months of the year, a sign that momentum continues to build despite the seasonal slowdown in August.

The Dubai Land Department recorded 75,519 property transactions between May and August, up sharply from 60,110 in the January–April period. While transactions dipped 4.5 per cent month-on-month between July and August due to the summer lull, analysts stress the broader trend remains upward, fuelled by both domestic demand and strong foreign capital inflows. Off-plan activity dominated, accounting for 58 per cent of transactions during the four months, versus 52.7 per cent in the earlier months of the year, underlining developers' ability to attract buyers with flexible payment plans and attractive launch pricing.

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A decisive shift in buyer behaviour is reinforcing the momentum. Engel & Völkers Middle East reported a 22 per cent rise in secondary market sales in the first eight months of 2025 compared with the same period last year, highlighting how more tenants are opting to purchase homes rather than remain in the rental cycle. Rising rents, attractive mortgage offers, and a growing sense of permanence among expatriates are prompting many families and professionals to commit to homeownership.“For many tenants, ownership is no longer aspirational; it's becoming the preferred choice for long-term security and value creation,” said Daniel Hadi, CEO of Engel & Völkers Middle East.

Dubai's residential market set another milestone in August with 17,879 transactions worth Dh42.4 billion, a 17 per cent increase in volume and 12 per cent rise in value year-on-year. Off-plan accounted for nearly three-quarters of all sales, up 25 per cent compared with last year, while the resale market also gained traction. Larger homes led the way, with sales of four-bedroom properties rising 70 per cent and five-bedroom or larger homes up 63 per cent over the same period.

Prices continue to climb across both villas and apartments. According to Property Monitor, average values in August stood at Dh1,664 per square foot, 16.3 per cent higher than a year earlier. Villas registered sharp gains in lifestyle-led communities, including Victory Heights (up 37 per cent), Dubai Hills Estate (26 per cent), and Arabian Ranches (23.2 per cent). Apartments too posted strong growth, led by Jumeirah Village Triangle (29.3 per cent) and Jumeirah Village Circle (17 per cent). Analysts say the combination of strong population growth, limited supply in mature communities, and Dubai's positioning as a global safe-haven city continues to underpin price resilience.

For investors, Dubai's rental yields remain among the highest globally. In August, average gross yields stood at 6.76 per cent, with apartments at 7.12 per cent and villas at 4.92 per cent. Despite double-digit price growth, yields still comfortably outpace prime international cities such as London (3–5 per cent), Singapore (3–4 per cent), and New York (5–7 per cent). With leasing volumes down 4 per cent this year and new contracts falling 14 per cent, more residents are locking in ownership as a hedge against escalating rents.

Demand remains diverse, spanning both international investors and local residents. Indian, British, German, Egyptian, and Chinese buyers remain highly active, particularly in the off-plan market, while domestic buyers are driving momentum in the resale segment. Mortgages are playing an increasingly important role, with loan-to-value ratios of 70–80 per cent and rates of around 3.9 per cent, among the most competitive globally. At the same time, cash purchases and developer-backed instalment plans are keeping demand buoyant in the off-plan space.

Adding further depth to the market is the First-Time Home Buyer Programme, launched in July by the Dubai Land Department and the Department of Economy and Tourism. The initiative grants first-time Emirati and expatriate buyers priority access to new launches, preferential pricing, and bespoke mortgage products.

Developers from Emaar and Damac to Binghatti and Danube have pledged to allocate at least 10 per cent of new units priced below Dh5 million exclusively to this segment. Banks, including Emirates NBD, Dubai Islamic Bank, and Mashreq, are supporting the programme with lower rates and faster approvals. Officials say the scheme is aligned with the Real Estate Strategy 2033 and the D33 economic agenda, which aim to double GDP and boost homeownership rates.

Market watchers expect the dual drivers of global investment in off-plan projects and the shift toward resident ownership in the resale market to remain strong through year-end. With population growth, flexible developer offerings, and government-backed initiatives lowering entry barriers, Dubai's real estate sector is increasingly viewed as not just a cyclical play but a long-term growth story. As Engel & Völkers' Hadi noted,“Dubai's property market is no longer just about short-term investment cycles. It is increasingly about residents choosing to establish roots here - buying homes for security, lifestyle, and long-term value creation. This shift is set to define the next phase of the city's real estate story.”

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