Dubai, May 30, 2025 – Dubai property prices have consistently increased for over four years. Now, however, analysts are saying that Dubai property prices will be on the way down as the current cycle hits its highest point. This news will be a relief for many potential buyers who have been waiting to go in at the right time.
Dubai Property Prices Reach Their Peak
According to Fitch Ratings, if prices fail to hit their highest ever mark, then the highest mark would be attained in 2025. The report further explains the extraordinary rally the city has witnessed, with Dubai property prices rising almost 60 percent between 2022 and Q1 2025. Heightened demand from foreign investors as well as professionals wanting to relocate to the UAE had fueled this extraordinary rally.
Dubai’s population growth rate is also quite explosive, surpassing 4 million by May 2025. However, supply in the property market is to outgrow population during the next couple of years. Fitch’s forecast is that property supply in Dubai will grow 16 percent from 2025 to 2027, while population growth will stay just about 5 percent during the same time period. That, in turn, shall place some downward pressure on the prices of Dubai properties.
Increased Supply to Impact Dubai Property Prices
The act of transferring the new units will be recorded. As per the plans, the leasing of almost 2.5 lakh new residential units is to take place over the forthcoming few years; the greatest disadvantage, however, shall fall in 2026, with the handover of 120,000-plus units. It is mentioned that only 30,000 units shall be handed over during the year 2024, while in 2025 the deliveries shall rise to 90,000 units. Such a high supply of units will very probably make Dubai real estate prices go into correction.
Fitch analysts raised the possibility that price drops in Dubai property would not exceed 15 percent and would likely be in operation in the second half of 2025 or in 2026. The report stated the correction might be less dramatic if the projects face delays in completion. It also stated that developers could relax their pre-sale payment plans, which would make it easier for investors to purchase the new properties. At present, it is often the case that buyers pay 70 percent during construction, but this might fall to 50 percent, making Dubai property prices more affordable to new investors.
What This Means for Buyers and Investors
Dubai is witnessing an opportunity for sale and purchase transactions as property prices are expected to soften. With an increasing number of units coming into the market and payment plans getting adjusted in favor of the buyer, the conditions seem favorable for those looking to invest in Dubai property.
Despite all this, buyers need to keep an eye on market trends and timelines of project completion. If unit delivery gets delayed, price drops in Dubai will rarely reach exhaustion. Yet, with demand falling well behind supply, the fall in prices could be even steeper.
The property prices in Dubai are due for a correction after rising for quite a number of years. With the increase in new supply, the market is expected to turn balanced, creating new avenues for buyers and investors alike.
Outlook for the Dubai Property Market
Dubai property prices have enjoyed a strong rally. But now, the market is entering a new phase. While a record number of new units will come into the market and population growth is slowing, prices in the Dubai market are still estimated to go down by some 15 percent over the coming two years. This correction should balance out the market, making it sustainable for the future.
Buyers and investors should watch Dubai property prices closely as the market shifts. The coming correction could offer new opportunities for those looking to enter the market or expand their property portfolios. As always, careful research and planning will be key to making the most of changing Dubai property prices.
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