Dubai Real Estate Market Overview January 2025

The Dubai real estate market in January 2025 captured considerable attention from both local and international investors, showing remarkable growth in volume and sales value. In all, property sales transactions emerged to 14,236 from the previous year’s level, representing a 23.2% rise over January 2024. This month’s overall sales revenue was AED 44.4 billion, a 24.1% rise from the previous year. Price per square foot remained steady at AED 1,550, marking the market’s resiliency despite square foot price declining slightly by -0.4%.

Market Segmentation: Performance by Property Type

The breakdown of sales by property type indicates varying levels of performance across the market:

Apartments:

• Sales Volume: A total of 9,945 apartments were sold, marking a 7.1% increase compared to January 2024. In strong economies like Dubai, it isn’t strange for local and international investors to show interest due to improved investment returns and expansion opportunities. This rise highlights the interest.
• Sales Value: Dubai’s real estate sector remains one of the most appealing investment hotspots with its sales value at AED 18.2 billion and still growing.
• Average Price: As the demand for rental apartments at prime locations increases, there is a constant rise in the average price of apartments. Recent statistics show the average price stands at AED 1.4 million which is a 3.7% growth from last year.

Apartments continue to lead in terms of the total units transacted, which suggests the sustained interest for residential properties in Dubai, particularly in active Jumeirah Village Circle (JVC), and Dubai Marina.

Villas:

• Sales Volume: 3,117 villas were sold, marking a massive 89.6% increase compared to January 2024, driven by growing interest in suburban and waterfront communities.
• Sales Value: The total sales value remained at AED 16.4 billion, indicating a robust investment demand despite price volatility.
• Average Price: The average villa price dropped to AED 3.1 million, a 6.3% fall from the previous year, reflecting a shift in buyer preferences for more economical villa options.

The most noticeable change was an increase in villa sales, which surged by 89.6% in total sales volume transactions. This corresponds to the heightened interest across the region including Palm Jumeirah and Dubai Hills Estate where a greater number of people are relocating.

Commercial Properties:

• Sales Volume: 363 commercial units were sold, reflecting a 17.9% increase from January 2024, as businesses and investors capitalize on Dubai’s thriving economy.
• Sales Value: Total sales value reached AED 1.2 billion, highlighting strong demand for office spaces, retail units, and commercial hubs.
• Average Price: The average commercial property price surged to AED 1.7 million, a 34.6% increase year-on-year, indicating rising property values in key business districts.

Although commercial Properties represent a smaller segment as compared to residential units, they have seen sharper price movements. This reveals Dubai’s business-friendly ambience encourages investors’ growing interest in the city’s commercial real estate.

Plots:

• Sales Volume: Due to developers and investors taking advantage of property buying or selling, 811 plots were sold, indicating a stunning 151.9% rise from January 2024.
• Sales Value: The total sales value reached AED 8.6 billion, reflecting strong confidence in Dubai’s long-term growth potential.
• Average Price: The average plot price dropped significantly to AED 673.6K, an 86.8% decline from last year, suggesting increased transactions in more affordable areas or smaller plot sizes.

The plot market has seen a sharp rise in transaction volumes, indicating that more investors are looking to purchase land for development, with certain areas witnessing massive increases in activity.

Property Price Changes in January 2025

While the market shows positive overall trends, certain property types have experienced varying price changes. For example:

• Apartments have seen a modest increase in prices (3.7%), reflecting the continued interest in this segment.
• Villas, however, experienced a slight price decline of -6.3% compared to January 2024, which can be attributed to shifting demand towards more affordable villa options in developing communities.
• Commercial properties have witnessed a significant price rise (34.6%), signalling a return of confidence in Dubai’s commercial sector.
• Plots have experienced a sharp decline in price (-86.8%), though this may be due to a shift in sales to areas that were not as highly priced in the previous year.

Rental Market Trends

The rental market has also experienced notable growth in January 2025:

• Apartment rents rose by 10.4% to AED 80,000.
• Villa rents increased by 12.5%, reaching AED 180,000.
• Commercial rents jumped significantly by 59.6%, averaging AED 75,000.

This surge in rental prices signals strong demand across all property categories, particularly in residential and commercial spaces, as more people and businesses seek to establish roots in Dubai.

Top Performing Areas in January 2025

Several key areas dominated the Dubai real estate market in January 2025. These include:

• Wadi Al Safa 5
• Jumeirah Village Circle (JVC)
• Dubai South
• Al Yelayiss 1
• Business Bay

These locations have seen increased transaction volumes, especially in residential properties like apartments and villas. JVC and Business Bay are especially attractive for buyers and investors due to their central locations and well-established amenities.

Price Range Distribution

The distribution of property sales by price range in January 2025 illustrates a healthy mix of transaction values:

• Properties sold for AED 1-2 million made up 27% of the total volume.
• AED 2-3 million properties accounted for 9%, while AED 3-5 million properties represented 14% of transactions.
• AED 5 million and above properties dominated 31% of the transactions, highlighting the sustained demand for high-end luxury homes and properties.

Top High-End Property Sales

Dubai’s luxury market continues to fascinate global investors. The most expensive apartment sales in January 2025 were:

• Ava at Palm Jumeirah – AED 57 million
• Ocean House at Palm Jumeirah – AED 50 million
• One Za’Abeel Tower at Zaabeel First – AED 45 million

Meanwhile, the highest-selling villas included:

• Hadaeq Sheikh Mohammed Bin Rashid – AED 140 million
• Bukadra – AED 130 million
• Palm Jumeirah – AED 64 million

These luxury sales reflect the continued appeal of prime locations like Palm Jumeirah and Za’abeel First for high-net-worth individuals.

Off-Plan Property Market in January 2025

The off-plan property market showed strong demand across both apartments and villas. The best-selling off-plan apartments included:

• Terra Heights – 493 units sold (AED 891.1 million)
• Verdes By Haven 1 – 155 units sold (AED 296.4 million)
• Lacina – 150 units sold (AED 313.3 million)

Off-plan villas also saw significant activity:

• La Tilia at Villanova Phase 2 – 106 units sold (AED 346.7 million)
• La Tilia at Villanova Phase 1 – 103 units sold (AED 327.7 million)

The off-plan market continues to evolve and buyers are buying new properties due to the competitive prices and developer incentives offered on new properties.

Mortgage Market Overview - January 2025

The total volume and value of transactions in the Dubai mortgage market decreased in January 2025 as compared to January 2024:

• Mortgage Transactions: 4,066 mortgages were completed, representing a 34.9 percent increase from the year before. This suggests continued interest in property financing despite a decrease in overall market activity.
• Mortgage Value: The total mortgage value reached AED 11.3 billion, down 56.4% from January 2024. The drop reflects a shift toward more cash transactions and lower-priced properties, with fewer high-value mortgages being issued.

Though the value of the mortgage market has contracted, the increase in transactions reveals sustained demand for financing, particularly in more affordable property segments. As the year moves, the mortgage market may recover with more promising lending conditions.

Conclusion

The Dubai real estate market in January 2025 remains vibrant and dynamic, showing growth across multiple segments, including apartments, villas, commercial properties, and plots. The prices are lower for some property types, but as a whole, the market is looking forward, as great demand and many types of investment opportunities are boosting the overall picture. The luxury sector continues to expand with the sale of further multi-million-dirham pieces of real estate confirming Dubai’s status as a leading global real estate hub.

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