UK Tax Changes Drive Ultra-Wealthy to Dubai as Property Market Grows 23% in H1 2025
Dubai’s residential real estate market recorded 91,897 sales transactions in the first half of 2025 — a 23% increase year-on-year — according to a new report by Espace Real Estate.
The market remained strong across both off-plan and ready properties, although signs of stabilisation are emerging in more established communities.
John Lyons, Managing Director at Espace Real Estate, noted:
“In H1 2025, Dubai’s residential market continued to display impressive resilience and growth. Demand for off-plan and ready units kept transaction volumes elevated.”
Market Snapshot: Off-Plan, Supply, and Community Trends
Off-plan deals accounted for 59% of all residential transactions in H1 2025, slightly lower than the 61% recorded during the same period in 2024.
Around 17,013 off-plan units were completed in the first half, boosting rental supply and easing upward pressure on rents — especially in newly handed-over areas.
Although many established neighborhoods saw reduced sales activity, both rental and capital values still trended upward.
The report also noted a behavioral shift, with more residents seeing Dubai as a permanent home rather than a short-term destination. This shift is contributing to market stability and more measured growth.
High-End Segment Surges
Sales of properties priced above AED 20 million saw the most significant growth, both compared to H1 2024 and H2 2024.
Villa and townhouse prices surged in 19 of the 20 tracked communities, with an average increase of 19%, fueled by constrained supply.
Meanwhile, apartment prices rose in 10 of 11 tracked communities, though gains were more modest — averaging 8% compared to 17% during the same period last year.
Rental Activity and Investor Trends
Rental activity slightly dipped across monitored communities due to increased availability. While rents continued to rise, the delivery of new projects helped temper the pace of rent hikes.
The report also highlighted that Dubai continues to attract global investor interest. The UK remains the largest source, but interest is growing from Europe, North America, and Asia-Pacific.
One major factor drawing ultra-wealthy UK residents to Dubai has been the recent overhaul of the UK’s non-dom tax regulations.
Outlook
Espace suggests that current market moderation could lead to healthier, more sustainable growth as Dubai’s property sector matures and evolves.
