Dubai’s real estate sector has continued its upward climb into 2025, registering property transactions worth more than AED142 billion ($38.7 billion) in the first quarter, according to a comprehensive data analysis by Bayut.
The momentum, driven by strong demand, ample supply, and the city’s attractiveness to high-net-worth individuals seeking a business-friendly and tax-efficient environment, has translated into widespread price appreciation across major communities.
Both apartments and villas experienced value growth, with DAMAC Hills leading the way villa prices in the community surged by nearly 21 percent, making it the top performer for price appreciation. This area also delivered standout returns for investors, achieving up to 11 percent in rental yield.
In terms of buyer preferences, budget-friendly localities such as Dubai Residence Complex, Dubai Silicon Oasis, DAMAC Hills 2, and Dubailand remained popular for cost-conscious purchasers. Mid-market buyers were largely drawn to communities like Jumeirah Village Circle, Business Bay, Al Furjan, and Reem. On the high-end spectrum, Dubai Marina, Downtown Dubai, Arabian Ranches, and DAMAC Hills continued to be major hubs for premium investment.
In the affordable segment, apartment prices rose by as much as 10 percent, while villa prices saw a rise of up to 6 percent. Mid-tier apartments recorded price gains ranging from 1 percent to 11 percent. A notable exception was Business Bay, where the average transactional price dipped by 3.09 percent, likely due to increased sales of smaller, more budget-friendly units during the quarter.
Luxury properties sustained their growth streak, with villa prices rising between 11 percent and 21 percent, and apartments appreciating by up to 11 percent. As confirmed by Dubai Land Department (DLD) figures, DAMAC Hills led villa price increases with a jump of 20.7 percent.
Q1 2025 also saw a strong volume of activity in both the ready and off-plan segments. More than 45,000 transactions were recorded, with over 15,000 involving ready properties valued at AED64 billion ($17.4 billion). Off-plan transactions, meanwhile, totaled more than 29,000, amounting to AED78 billion ($21.2 billion).
When it comes to rental returns, affordable apartment locations like International City, Dubai Investments Park (DIP), and Discovery Gardens generated robust yields between 9 percent and 11 percent. Mid-range communities such as Living Legends, Al Furjan, and Town Square also performed well, with returns between 8 percent and 11 percent. In the luxury apartment category, Al Sufouh, Green Community, and DAMAC Hills offered yields exceeding 7.88 percent.
Villas in budget-conscious areas like DAMAC Hills 2, Serena, and International City delivered rental yields of over 5.71 percent. Mid-range villa communities, including Jumeirah Village Circle, Motor City, and Mudon, achieved 5 percent to 8 percent returns. High-end villa areas such as Al Barari, Dubai Creek Harbour, and Mohammed Bin Rashid City posted returns surpassing 5.82 percent.
Commenting on the strong start to the year, Haider Ali Khan, CEO of Bayut, Head of Dubizzle Group MENA, and Board Member of the Dubai Chamber of Digital Economy, said that Dubai’s real estate sector is building on the momentum of the previous year. He noted that global investor interest remains high, particularly in the luxury segment, and that the emergence of sustainable, master-planned developments is aligning with growing demand for comprehensive, community-oriented living environments.
Source: Arabian Business
