Since moving from Beirut to Dubai in 2023, Lebanese expatriate Mohammad Yassin has watched property prices and rents soar and felt the growing strain on middle-class budgets.
“Owning a home in Dubai, amid the ever-rising cost of living, has become a distant dream, even for people with steady incomes,” Yassin said.
Like him, many residents and families have given up on the dream of home ownership, hoping only to keep up with rent payments and daily expenses.
Even so, more housing units keep coming onto the market, and Dubai’s real estate sector remains one of the most active in 2025, powered by strong demand from local and international investors. Office and industrial properties continue to see high occupancy and steady rent growth, driven by rising interest in logistics assets.
Data from Betterhomes and Property Monitor show continued strength in both transactions and demand this year. The Dubai Land Department reported real estate sales worth 100 billion dirhams (about $27 billion) between the start of the year and March 4. By mid-year, that figure had climbed to 326.64 billion dirhams, up 40 percent from 233 billion dirhams during the same period in 2024.
Dubai continues to rank among the world’s leading luxury property markets, recording 590 sales of homes valued above $10 million since January, nearly matching the combined totals of London and New York in the same category.
According to Bloomberg, property prices in Dubai have risen 70 percent since the end of 2019, alongside annual increases in both sales and rents across most emirates.
That surge has raised doubts about how sustainable the boom is, prompting a question increasingly heard in Dubai: Is a property bubble forming?
Million-Dollar Deals
In 2024, Dubai was estimated to account for roughly 20 percent of global luxury real estate sales, setting record-breaking transactions in Palm Jumeirah, Emirates Hills, Jumeira Bay Island, and Dubai Hills Estate, where some properties sold for more than $100 million.
Major deals followed in the first half of 2025, including 3,731 transactions each worth at least 10 million dirhams, a 63 percent jump from a year earlier. The second quarter alone saw 2,388 deals, the highest quarterly total ever recorded.
Among the standout sales was a 60,000-square-foot mansion in Emirates Hills that sold for 750 million dirhams, and another in Dubai Hills Estate for 150 million dirhams.
The luxury villa segment posted robust growth in the first half of 2025, with transaction values rising 27.6 percent to 78.3 billion dirhams, up 53.5 percent from the first half of 2024, driven by demand for new communities and larger family homes.
Apartments also held their ground, with sales up 18.2 percent year-on-year to 71,879 units, accounting for about 79 percent of total transactions and more than half the market’s total value.
Real estate data suggest Dubai’s property market remains resilient and increasingly sophisticated, sustaining demand for high-end units and record transaction values. The boom has even created a class of “accidental millionaires,” homeowners who bought properties for under $1 million years ago and have since seen their values skyrocket. Analysts estimate there are now around 37,000 such homeowners in Dubai.
Yassin believes Dubai is designed primarily for the wealthy, offering them unmatched comfort and luxury, while middle-income residents live within their limits, enjoying some of the city’s advantages but far removed from its trademark opulence.
Risk of a Bubble
A central question now echoes through economic circles: Has Dubai, the global hub of wealth and investment, entered another real estate bubble, or is its market today more mature and resilient than in past crises?
Global economic reports have begun sounding the alarm. The UBS Global Real Estate Bubble Index for 2025 placed Dubai in the “high-risk” category after prices surged more than 50 percent in five years, the highest increase among all cities in the study.
But real estate expert Ahmad Awad argues that the current rise in prices is part of a natural growth cycle fueled by strong demand and economic expansion, not a speculative bubble. “The UAE market is well regulated and built on solid foundations, which gives it the strength to withstand fluctuations,” he told Alhurra.
Housing supply and demand in Dubai are now shaped by several structural factors that make future trends difficult to predict, including population growth of about 15 percent since 2020 and an expanding supply that could soon test the market’s limits, according to real estate reports. Data from Jones Lang LaSalle indicate roughly 250,000 new housing units are under development and expected to enter the market in the coming years, representing about a 30 percent increase in supply.
Awad said a price correction is possible but will not affect all projects equally. “Premium properties will retain their value and stability,” he said.
Dubai’s property market has weathered multiple crises, from the costly The World project, which stalled after billions in losses in the 2000s, to the 2014 slowdown triggered by falling oil prices, and the pandemic-related slump that hit global demand.
“After the UAE’s experience during the COVID-19 pandemic, it’s difficult to take pessimistic views of its crisis management seriously,” Awad said.
“Real estate isn’t a quick trade,” he added. “Those who buy with short-term resale in mind are making a serious mistake. Property investment is long-term, and those chasing quick gains tend to exaggerate fears of bubbles.”
Sukina Ali
A Saudi writer, researcher, and TV presenter
