S&P Global’s Forecast for the Dubai Real Estate Market in 2025
10.11.2024
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S&P Global has published a forecast regarding the development of the Dubai real estate market for the coming years. Experts expect that over the next 18 months, property prices and rental rates in the emirate will remain stable. However, with the anticipated increase in supply, property prices may start to decline in 2025.
Key Factors Influencing the Market:
1. Construction Rates: Between 2025 and 2026, Dubai plans to introduce 182,000 new real estate units. This will significantly increase the market supply.
2. Population Growth: The emirate’s population is expected to grow by 3.5% annually in 2025-2026. By 2026, approximately 4 million people are projected to reside in Dubai.
3. Economic Stability: Conflicts in the Middle East have not adversely affected the UAE's economy. According to S&P Global, the gross domestic product (GDP) growth in Dubai is expected to average around 3% per year from 2024 to 2027.
Current Market Situation:
As of fall 2024, the real estate market remains active, with a new record set in September: over 18,000 transactions were concluded in a single month. Average prices for apartments reached $353,000, for townhouses $751,000, and for villas $1.9 million.
One reason for the strong interest from foreigners is the opportunity to obtain a long-term visa by purchasing property valued at $204,000 (750,000 dirhams). This particularly attracts Russians and Belarusians, for whom there are no restrictions.
S&P Global’s forecasts indicate that while stability in the Dubai real estate market is expected in the short term, a shift related to increased supply may occur in the long term. With active construction and population growth, the market in Dubai continues to attract investments and new residents. For investors, this might be the right moment to consider the opportunities within this sector of the economy.
Key Factors Influencing the Market:
1. Construction Rates: Between 2025 and 2026, Dubai plans to introduce 182,000 new real estate units. This will significantly increase the market supply.
2. Population Growth: The emirate’s population is expected to grow by 3.5% annually in 2025-2026. By 2026, approximately 4 million people are projected to reside in Dubai.
3. Economic Stability: Conflicts in the Middle East have not adversely affected the UAE's economy. According to S&P Global, the gross domestic product (GDP) growth in Dubai is expected to average around 3% per year from 2024 to 2027.
Current Market Situation:
As of fall 2024, the real estate market remains active, with a new record set in September: over 18,000 transactions were concluded in a single month. Average prices for apartments reached $353,000, for townhouses $751,000, and for villas $1.9 million.
One reason for the strong interest from foreigners is the opportunity to obtain a long-term visa by purchasing property valued at $204,000 (750,000 dirhams). This particularly attracts Russians and Belarusians, for whom there are no restrictions.
S&P Global’s forecasts indicate that while stability in the Dubai real estate market is expected in the short term, a shift related to increased supply may occur in the long term. With active construction and population growth, the market in Dubai continues to attract investments and new residents. For investors, this might be the right moment to consider the opportunities within this sector of the economy.
