Dubai Property Market Overview

Despite a significant contraction in sales value and volume across both primary and resale sectors by 21-29%, price per sqft continues to rise modestly by 5-6%, signaling that price gains are concentrated in fewer, likely higher-quality or premium transactions. The resale market displays a pronounced divergence, with a sharp 28% volume decline yet a robust 62% surge in capital gains, suggesting a strong premium on scarcity and select assets rather than broad market appreciation. This mismatch highlights a liquidity squeeze in the secondary market, while primary market sales, making up 67% of total value and 71% of volume, maintain more stable transactional throughput, indicating capital preference towards new developments over resales amid the current cycle downturn. Investors should prioritize selective primary projects with sustained liquidity over resale assets, which are trending towards higher valuation but lower transactional support.

Mortgage activity diverges notably from overall sales trends, with a 15% increase in mortgage volume value and an 11% rise in mortgage transactions despite a 21% decline in total sales volume. This indicates an expanding role for leveraged purchases, supported by a higher loan-to-value ratio at 75.5%, which may be driving price resilience amidst falling cash transactions that dropped nearly 5%. Cash transactions now constitute just 67% of mortgage-involved sales, down from previous periods, pointing to a shift in buyer profiles towards financed acquisitions. For investors, this transition suggests that mortgage-backed demand is underpinning price stability; therefore, capital deployment should be aligned with financing structures and mortgage availability trends to capture enduring underlying demand rather than relying on cash-driven market momentum.