Dubai’s real estate sector recorded its first price dip in over two years, indicating a shift towards a more balanced market. According to Property Monitor, residential prices declined by 0.57% in January 2025, bringing the average price per square foot to AED 1,484. This marks the first downward movement since mid 2022.
Despite this adjustment, market activity remained robust. A total of 14,413 transactions were recorded in January, making it the busiest start to a year on record. However, sales volumes saw a slight 4.6% reduction compared to December 2024.
Market Trends and Transactions
Off-plan developments maintained strong momentum, with 53 new project launches from 37 developers, adding 12,400 units to the market. Mortgage transactions saw a 6.8% uptick compared to the previous month, with 4,134 new loans secured. Loan-to-value ratios remained steady, even as UAE Central Bank regulations continued to be enforced more strictly.
Zhann Jochinke, Chief Operating Officer at Property Monitor, noted that they are beginning to see indications of a market settling into a more sustainable phase, following an extended period of steady growth. While transaction volumes remain high, affordability factors and broader market maturity are influencing current trends.
He added that the trajectory of the sector in the coming months will largely depend on maintaining a balanced supply and demand equation.
Property Prices and Performance
The latest report highlights median property prices, with apartments averaging AED 1,350,000, townhouses at AED 2,610,000, and villas reaching AED 6,915,888. Off-plan transactions accounted for 52% of total sales in January, though this segment saw a 17.7% month-on-month decline.
Meanwhile, title deed transactions increased by 15.7%, making up 47.6% of total market activity. Leading the off-plan sales market, Emaar Properties secured a 16.5% share, followed by DAMAC Properties at 15.8% and Danube Properties at 5.3%.
On the high end of the market, a villa in Emirates Hills recorded the most significant sale at AED 425M, while the most affordable transaction was a studio apartment in Dubai Production City, priced at AED 175,000.
A Market Poised for Sustainable Growth
Dubai’s real estate market experienced an impressive 30% year-on-year expansion in 2024, setting new records across prices, launches, transactions, and mortgages. The recent signs of moderation suggest that the sector is evolving towards a phase of steadier, long-term growth.
Original article reference: Arabian Business.
