The UAE’s property market is set for another significant year, with new data showing record-breaking activity in Dubai, a stronger-than-expected rebound in Abu Dhabi, and a major supply wave expected to reshape conditions from 2025 to 2027.
According to figures released for the first half of 2025, Dubai posted its strongest-ever quarter between April and June, reaching 53,252 sales worth AED 184.3 billion (AUD 78.8 billion).
Across the first six months of the year, Property Finder reported the emirate recorded 98,726 transactions totalling AED 327 billion (AUD 139.3 billion), reinforcing its position as one of the world’s most active real estate markets.
The average rental yield now sits at 7.4%, rising to 9.4% in several affordable communities.
A total of 94,717 investors, the majority foreign, placed AED 326 billion (AUD $138.9 billion) into UAE properties during the same period.
Dubai surges while Abu Dhabi rebounds
Dubai’s strong performance was driven by both end-users and investors, with ready homes taking a 60% share of monthly volumes.
Q1 activity reached 45,474 transactions worth AED 142.7 billion (AUD 60.7 billion), representing a 22% lift in volume and a 49% lift in value year-on-year.
Abu Dhabi had a slow start, recording a 35% fall in Q1 transactions, but the capital staged a swift turnaround in the second quarter with a 10% rise in sales and a 48% increase in value.
Together, the two markets sit at roughly 90% of peak activity, signalling a firm seller’s market.
High rental yields attract investors
Affordable communities under AED 1,500 per sq ft (AUD 640 per sq ft) continue to offer the strongest returns, with yields above 7.5%.
Current yield leaders include:
- Dubai Investment Park – 9.44%
- International City – 9.10%
- Arjan – 7.90%
- Discovery Gardens – 7.77%
- Jumeirah Village Circle – 7.59%
Lower entry prices in communities such as International City—where property averages AED 725 per sq ft (AUD 310 per sq ft)—continue to support high investor activity.
Emerging areas show firm price growth
Price data from August 2024 to August 2025 highlights several fast-moving communities, including Barsha Heights, Dubai Internet City and Emirates Hills 2.
Additional growth was recorded in:
- Mohammad Bin Rashid Gardens (Dubai)
- Dubai Waterfront
- Sharjah Waterfront City (Sharjah)
- Al Majaz (Sharjah)
- Gateway Residences (Ras Al Khaimah)
Redevelopment, tech precinct expansion and increased demand for mixed-use precincts were key drivers.
Foreign buyers continue to dominate, accounting for more than 70% of total investment value.
Growing participation from residents and women investors is also reshaping buyer demographics.
A major supply wave is coming
Property Finder forecasts a three-year supply pipeline of 240,000 units, including:
- 90,000 units in 2025
- 120,000 units in 2026
- 30,000 units in 2027
This represents roughly a 20% increase in Dubai’s housing stock and is likely to shift market balance towards buyers from 2026 onwards.
Strategic outlook: 2025–2027
Late 2025
The market remains seller-driven. Investors seeking reliable income are encouraged to act ahead of the supply surge, particularly in communities producing yields above 9% or in competitively priced off-plan developments.
Early 2026
As new stock arrives, conditions are expected to ease. Prices may stabilise, giving buyers more negotiating power and more favourable entry points.
Late 2026–2027
The market is projected to enter a stable phase. Investors are advised to focus on mature, well-connected communities capable of maintaining rental demand and long-term value.
A balanced Dubai-focused portfolio may include a 60% allocation to ready homes and 40% to off-plan projects, with properties priced under AED 1,500 per sq ft (AUD 640 per sq ft) offering strong income performance.
The outlook for UAE property
Despite an expected moderation in some segments from 2026, the UAE remains one of the most active and stable real estate environments globally.
Record transaction volumes, strong yields, increasing foreign interest and a substantial supply pipeline all point to a market entering its next stage of growth.
For strategic investors, the next two years offer a significant chance to secure property across both established and fast-developing communities before the market settles into a more balanced phase.
