Dubai’s residential property market continues to grow strongly over the past year, with property values rising by 19.1% over the course of 2024, and now standing at AED 1,685 per square foot, according to the Dubai Residential Market Report Q4 2024, published by global real estate consultancy Knight Frank.
This puts average prices 13.3% above their 2014 peak.
On average, villa sales prices have risen by 20.2% over the past 12 months, reaching AED 2,009 per square foot, putting them 38.1% above their 2014 peak. According to Knight Frank, this sustained growth demonstrates the strong appeal of standalone villas, beachfront homes and branded residences that offer immediate access to the Dubai lifestyle. The report, ‘Dubai Destination 2024’, showed that: Access to green spaces, wellness centres and waterfront locations are key factors attracting wealthy international buyers.
“Residential property values remain on an upward trajectory with no signs of abating demand from either local or international buyers,” explained Faisal Durrani, Partner and Head of Research for the Middle East and North Africa at Knight Frank.
Residential Buying
A significant observation in this cycle, according to Knight Frank’s report, is the increasing number of genuine end-users rather than speculative buyers as in previous cycles. This change is reflected in a 30% drop in homes available for sale across the emirate last year, with the emirate’s luxury home market seeing an even sharper 52% drop in listings. However, the report says, global HNWIs remain focused on villas, which rose 20.2% in value last year, reflecting a 99.8% increase from Q1 2020 prices.
Upcoming supply
Knight Frank has updated the total residential supply due to be completed by 2029. The total number of homes under construction now stands at 302,880.
Of these, 80% will be apartments, 18% villas and 2% branded residences.
This translates to an average of around 60,576 homes per year over the next five years, above the long-term completion rate of around 36,000 homes per year. While this appears to be above historical levels, there has been a 30% delay in the completion of promised projects over the long term. With this in mind, the company highlights that just over half of the 60,000 homes it promised to deliver in 2024 have been delivered.
Scarcity of premium homes
The number of homes available for sale in the $10 million+ category has fallen by 40%, from 4,119 to just 2,491 over the past 12 months. The number of homes available in the $25 million+ category has more than doubled (85%), from 583 to just 86 over the past year.
Rising performance
Dubai’s luxury property market, which includes the Palm Jumeirah, Jumeirah Bay Island, Jumeirah Islands and Emirates Hills, has also seen a rise in performance. During Q4 2024, the average price traded in Dubai’s most affluent neighbourhoods stood at AED 6,627 per square foot, up 16.9% compared to Q4 2023.
Safe haven
Petri Manella, Partner at Knight Frank’s Prime Residential Dubai, said Dubai’s prime property market has cemented its position as a safe haven for international and local luxury buyers with another record year for the $10 million home market, recording 435 transactions during 2024, 153 of which were recorded in Q4 alone, making it the highest number ever recorded in a single quarter for the sector.
He said this growth over the past 12 months (16.9%) highlights that continued demand for prime properties, coupled with a decline in available prime homes, continues to drive prices, which have reached AED 6,627 per square foot since Q4 2024.