Dubai residential prices climb 13.7% year-on-year

• Villa prices grow 16% YoY, continuing to outperform the wider market
• Q2 2025 sees over 51,000 home sales - an all-time quarterly record
• H1 2025 transaction value hits AED 268 billion, on track to surpass 2024’s AED 367 billion

Dubai, UAE | 23 July 2025: Dubai’s residential property market continues to set records, with Q2 2025 marking a historic high in both transaction volumes and values. According to the latest analysis from global property consultancy Knight Frank, residential prices are now 13.7% higher than a year ago, with villas leading the charge - up 16% year-on-year.

Dubai’s dynamic market continues to grow, with no signs of a slowdown in activity. In Q2, the city recorded over 51,000 home sales - the highest quarterly figure on record. This brings total H1 2025 sales to more than 94,000, putting the market firmly on track to exceed the 169,000 transactions recorded in 2024.

The total value of residential sales in H1 reached AED 268 billion, a 41% increase compared to the same period last year. With this momentum, 2025 is poised to surpass the AED 367 billion achieved in 2024.

Citywide residential prices rose by 3.4% in Q2 2025, reaching an average of AED 1,809 per square foot. This places current values 21.6% above the previous market peak recorded in 2014.

Faisal Durrani, Partner – Head of Research, MENA, said: “The sustained growth in prices - now approaching five consecutive years since the current cycle began in November 2020 - is a clear sign of a more stable and predictable market environment. This is precisely the kind of consistency that global investors seek. Knight Frank’s forecasts for 2025 remain unchanged, with 8% growth expected in the mainstream market and 5% in the prime segment.

A segment to watch remains the villa market. Just 20% of the planned housing supply through to the end of 2029 will fall in the villa category and with demand remaining centred on stand-alone family homes, the delta between villa and apartment price performance may well continue to widen.”

Villas continued to outperform the broader market, with values climbing to AED 2,172 per square foot - a 4% increase over the quarter and a 49.3% rise since 2014. The prime segment also scaled new heights, with prime residential values across ten key communities rising by 16% over the past 12 months. The average prime transacted price now stands at AED 3,850 per square foot.

Off-plan sales account for nearly 70% of all transactions in Q2, reflecting growing investor confidence and the appeal of new developments across the city. Prime residential areas such as Palm Jumeirah, Emirates Hills, Jumeirah Bay Island, and Dubai Hills Estate remain the most sought-after locations, particularly among international high-net-worth individuals.

Sales of homes priced above US$ 10 million reached AED 9.5 billion in Q2 2025, the highest quarterly figure on record. Notably, for the first time since Q2 2023, apartments outpaced villas in the US$ 10 million+ segment, with 80 apartment sales compared to 63 villas.

Will McKintosh, Regional Partner – Head of Residential, MENA, said: “The market is increasingly being shaped by genuine buyers rather than speculators, with resale activity within 12 months of purchase now at just 4–5%, compared to 25% in 2008. This shift toward end-user activity is a positive indicator of the market’s growing maturity and long-term sustainability.

As we approach the fifth year of Dubai’s current growth cycle in November 2025, we are seeing the property market mature and align with global norms in a meaningful way. It has become more stable, more transparent and is underpinned by solid fundamentals. This shift is drawing in more long-term investors and end-users and is helping to strengthen Dubai’s position as one of the most attractive residential markets globally.”

Knight Frank’s annual Destination Dubai 2025 report also highlights the emergence of ‘accidental millionaires’ - homeowners whose properties have appreciated beyond US$ 1 million due to market inflation. As of Q2 2025, there are 110,000 such homes in Dubai, with 37,000 owned by individuals who originally purchased below the million-dollar threshold.

For more data insights, read Knight Frank’s Dubai Residential Market Review here and Destination Dubai 2025 here.