Dubai Property Market Overview

The overall sales value of AED 354.3 billion declining by 22% year-over-year, alongside a 20% volume drop to 113.8k transactions, signals a notable contraction in market activity. However, the 6% rise in price per sqft to AED 1.7k suggests that price increases are detached from transaction volume, indicating price inflation unsupported by widespread buying interest. The primary market, commanding 68% of value and 72% of volume, shows a smaller decline in sales (-17% value, -15% volume), which implies that developers' new inventory is better absorbing demand compared to resale properties, where sales value and volume fell by 30%. The resale segment's strong 63% surge in capital gains (AED 37.8 billion) despite volume contraction reflects concentrated speculative activity or selective asset appreciation rather than broad market strength.

Mortgage activity contrasts sharply with cash transactions, as mortgage value increased by 11% to AED 136.2 billion and loan-to-value ratios rose to 75.74%, while mortgage transaction volume fell 11%. This divergence suggests larger, more leveraged deals are driving demand in the financed segment even as total mortgage deals decline, highlighting a bifurcation in buyer profiles. With cash transactions still constituting nearly 67% of mortgage-involved deals but declining by 5%, liquidity constraints or buyer caution are evident. Investors should prioritize assets with strong financing support and avoid reliance on headline price gains unsupported by volume, focusing instead on primary market opportunities where transaction activity remains more resilient and financing conditions are favorable.