Bayut has released its report on the most in-demand residential areas in Dubai for the first quarter of 2025. The data shows significant growth in property prices across key areas, supported by increased demand, stable supply, and Dubai’s continued attractiveness to investors and individuals seeking high-spec housing, thanks to its thriving economy and encouraging environment.
Buying Trends
The company’s insights for the first quarter of 2025 show continued momentum in the Dubai market, with significant increases in apartment and villa prices. Damac Hills villas led the way, with a 21% increase, while apartment prices in lower-priced areas rose by up to 10%, and villas by 6%.
The mid-market segment saw increases ranging from 1% to 11%, with the exception of Business Bay, which recorded a slight decline of 3.09% due to increased demand for smaller units. Luxury properties continued to perform strongly, with villa prices rising between 11% and 21%, and apartments up to 11%.
Buyer Interest
Buyer interest varied according to budget, with those seeking lower-priced options heading to areas such as Dubai Residence Complex, Dubai Silicon Oasis, Damac Hills 2, and Dubailand. Mid-market buyers preferred communities such as Jumeirah Village Circle, Business Bay, Al Furjan, and Al Reem, while areas such as Dubai Marina, Downtown Dubai, Arabian Ranches, and Damac Hills continued to attract investors seeking luxury properties. According to data from the Dubai Land Department, more than 45,000 real estate sales transactions were recorded during the first quarter of the year, with a total value exceeding AED 142 billion. These included approximately 15,000 ready property transactions worth AED 64 billion and 29,000 off-plan property transactions worth AED 78 billion.
Return on Investment
The company’s data revealed strong investment returns in a number of real estate areas in Dubai, particularly in the apartment sector. Lower-priced apartments in areas such as International City, Dubai Investment Park, and Discovery Gardens achieved attractive rental returns ranging from 9% to 11%. Mid-priced residential communities such as Living Legends, Al Furjan, and Town Square recorded returns ranging from 8% to 11%. Luxury apartments in Al Sufouh, Green Community, and Damac Hills also performed well, with rental returns exceeding 7.88%.
In the villa sector, areas such as Damac Hills 2, Serena, and International City demonstrated strong performance within the lower-priced villa category, with investment returns exceeding 5.71%. Returns in mid-priced villa communities such as Jumeirah Village Circle, Motor City, and Mudon ranged between 5% and 8%, while investment returns in luxury communities such as Al Barari, Dubai Creek Harbour, and Mohammed Bin Rashid City exceeded 5.82%, reflecting the continued attractiveness of the real estate market across all investment segments.
Rental Trends
The report’s findings indicated a general upward trend in property rents in Dubai, with some notable exceptions by category and area. Rents for lower-priced apartments increased by 1% to 3%, with the exception of some units in Deira and Bur Dubai, which saw rents decline by up to 7%.
Rents in the mid-range segment also increased by 1% to 5%, while luxury three-bedroom apartments in Dubai Marina and Dubai Creek Harbour recorded slight declines of 3.52% and 2.11%, respectively.
In the villa sector, lower-priced areas recorded significant rent increases of up to 11%, while rents for mid-range villas increased by 3%. Declines were recorded in some categories, such as three- and four-bedroom villas in Al Furjan and five-bedroom villas in Jumeirah Village Circle, which decreased by up to 7%.
A Big Jump
Luxury villas saw the largest jump, with increases of 75%, particularly in Dubai Hills Estate, driven by the handover of new units in communities such as Fairways, Golf Place Terraces, and Maple. In terms of geographical distribution, Bur Dubai and Dubai Residence Complex maintained their position in the low-end segment, while Damac Hills 2 and Mirdif emerged as the leading villa communities. In the mid-range segment, Jumeirah Village Circle and Business Bay were popular destinations for apartments, while Al Furjan and Jumeirah Village Circle attracted tenants looking for villas. In the luxury segment, Dubai Marina and Downtown Dubai maintained their lead for apartments, while Jumeirah and Damac Hills led the way for villas. Accelerated Growth
Dubai’s real estate market is experiencing rapid growth, driven by economic stability, expanding infrastructure, and government initiatives that attract foreign investment. Real estate transactions in January increased by a remarkable 22.9% year-on-year, as the population exceeded 3.8 million.
The luxury real estate sector continues to play a pivotal role in this growth, with sales nearly doubling due to strong demand from high-net-worth buyers. Sustainable development projects and integrated residential communities have also attracted investors seeking a modern, eco-friendly living environment.
Strong Momentum
Haider Khan, CEO and Head of Dubizzle MENA, said: “Dubai’s real estate market has started 2025 with strong momentum, building on the positive performance it achieved in 2024. The city continues to strengthen its position as a global investment destination, with growing demand for luxury properties from high-net-worth investors.”