Dubai real estate market grows 23% in Q1 2025 as villa sales lead surge: Report
Dubai’s residential real estate market maintained its growth trajectory in the first quarter of 2025, recording significant increases in both transaction volumes and values, according to new figures released by Betterhomes.
Data from the Dubai Land Department (DLD) showed total property sales transactions rose by 23% year-on-year to 42,422 deals during the first three months of the year. The value of these transactions reached AED114 billion, a 29% increase compared to the same period in 2024.
Villa sales in Dubai jump 65% as demand for larger homes increases
Apartments continued to represent the largest segment by volume, accounting for 32,237 transactions, a 14% rise from the previous year.
Villas recorded the strongest growth, with transactions climbing 65% year-on-year to 10,185 deals. The total value of villa sales increased by 56% to AED53.4 billion.
The off-plan sector remained dominant, making up 59% of all transactions, with 24,942 deals, reflecting a 25% year-on-year increase. However, within the prime property category, off-plan transactions fell by 30% while secondary market prime sales increased by 77%.
Betterhomes reported that average selling prices rose by 28% across the market. Villas saw the most significant price movement, with a 92% increase in average selling prices.
Mortgage-backed purchases also continued to grow, now comprising 57% of all Betterhomes sales.
Christopher Cina, Director of Sales at Betterhomes, said: “Q1 2025 has reaffirmed Dubai’s resilience and continued global appeal. We are seeing more buyers acting with urgency, securing properties faster to avoid potential price increases or losing out on preferred options. Demand for villas, townhouses, and prime properties continues to grow. What’s notable is the shift to more end-users and mortgage-backed buyers, indicating deeper confidence in Dubai as a place to live and invest long-term.”
The report also revealed a 14% annual rise in buyer enquiries and a 51% increase compared to the last quarter of 2024.
Townhouse leasing enquiries in Dubai climb 199% in early 2025
Townhouses experienced the most notable growth in demand, with a 64% quarter-on-quarter increase in buyer leads.
End-users now represent 50% of the market, a 22% increase from the previous quarter. Mortgage transactions increased by 21% year-on-year and 13% quarter-on-quarter.
Jeffrey De Souza, Head of Mortgages at Lomond, said: “In today’s market, with property prices rising and the cost of renting increasing, buyers are seizing the opportunity to turn monthly payments into long-term equity.”
In rentals, Betterhomes recorded a 36% annual increase in tenant leads. The townhouse segment saw a 199% rise in leasing enquiries year-on-year, while apartment leads increased by 39%.
Tenant demand for Dubai rentals increases 36% in Q1 2025
Rupert Simmonds, Director of Leasing at Betterhomes, added: “With tenants planning to stay longer, we are witnessing a rise in multi-year rental contracts. This is a win-win, with tenants securing rental rates and landlords benefiting from reduced turnover and fewer vacancy periods.”
Luxury transactions in the secondary market rose, with properties above AED15 million increasing by 44% year-on-year. Secondary market sales in this segment climbed 77%. Popular areas included Palm Jumeirah, Emirates Living, and Downtown Dubai.
Looking ahead, Property Monitor data shows 7,848 new residential units were completed in Q1 2025, with a peak of nearly 97,000 expected in 2026. Off-plan launches continue to support supply in Zabeel, Dubai Creek Harbour, and Dubai South.
