Dubai Property Market to See Continued Growth Amid Supply Constraints. The property market in Dubai is expected to witness continued price and rental growth over the next two to three years, driven by increasing demand and limited supply, according to industry experts.
A recent report by ValuStrat, a management consultancy firm, revealed that only 27,000 new residential units were completed in 2024—the lowest number in the past six years. This supply shortage comes as Dubai's population continues to expand, creating a gap between demand and available housing.
The report indicates that out of the newly completed homes, 20,066 were apartments, while only 6,891 were villas. Experts highlight that apartment construction significantly outweighs villa development, which is contributing to the supply imbalance.
According to Mario Volpi, head of brokerage at Novvi Properties, the disparity in housing types is a major concern. "Building high-rise towers is more practical than developing standalone houses, which require larger plots and infrastructure," he explained. "For the market to stabilize, we need at least double the current number of new homes being delivered."
Projected Supply and Demand Trends
The study estimates that 118,401 apartments and 28,351 villas and townhouses are currently under construction, with anticipated completion by 2028. However, until this new supply enters the market, property prices and rental rates are likely to remain elevated.
Matthew Green, head of research at CBRE Mena, pointed out that population growth is the primary driver of increasing housing costs. "The market data suggests that there isn’t enough supply to accommodate the growing number of residents. Dubai’s population now exceeds 3.8 million and is expected to continue growing at a rate of 3.6% annually until 2030," he noted.
While rental and purchase prices are projected to rise throughout 2025, the rate of increase is expected to slow compared to previous years. Mr. Green anticipates a more balanced market by 2026-2028 as additional housing projects are completed.
Market Indicators and Future Outlook
Indicators such as traffic through Salik toll gates, mobile network registrations, and electricity and water connections reflect increasing demand for housing. However, a surge in off-plan sales over the past few years has bolstered the development pipeline, with approximately 40,000 to 45,000 units slated for completion in 2025. This figure is expected to rise even further from 2026 to 2028, helping moderate price increases.
Despite this expected rise in supply, experts caution that demand remains ahead of construction, particularly in key residential areas. The ValuStrat report highlights that Jumeirah Village Circle (JVC) is expected to receive 12% of the new housing supply by 2028, followed by Business Bay with 8% and Jumeirah Lake Towers (JLT) with 5%.
Industry Insights and Developer Perspectives
Developers are actively seeking innovative solutions to meet the growing demand. Mohammed Tahaineh, general manager of projects at Damac, emphasized Dubai’s appeal as a global investment hub. "The city's rapid population growth and economic expansion are driving strong demand for residential properties. We are leveraging advanced construction technologies and strategic planning to meet this demand effectively," he said.
Meanwhile, Christopher Cina, director of development sales and consultancy at Betterhomes, believes that the rising supply in 2025 will help stabilize the market. "With over 72,000 new units expected for handover next year, the market is likely to see a significant boost in supply. This should help moderate rent and sale price increases, keeping growth below 10%," he stated.
While the Dubai property market remains highly competitive, experts agree that the supply-demand gap will likely persist until 2027-2028, after which a more balanced market may emerge. Until then, residents and investors can expect gradual price increases driven by sustained demand.
Source: The National News
