Dubai Property Market Overview

Despite a significant contraction in overall sales value by 20% and transaction volume down 18% year-on-year, the price per square foot has risen by 7%, signaling a price resilience unsupported by broad transaction growth. The primary market continues to dominate capital flow with 69% of sales value and 72% of transaction volume, showing less decline (-15% value, -12% volume) compared to resale. However, resale reveals substantial capital gains of 34.7B AED, up nearly 63%, indicating price appreciation concentrated in fewer, higher-value deals, which could create pockets of speculative risk amid overall market tightening.

Mortgage activity is rising, with mortgage value up 14% and loan-to-value ratios increasing nearly 5 percentage points, yet mortgage transaction volume has fallen by 10%. This divergence suggests higher leverage per financed deal but fewer buyers relying on mortgages, hinting at a cautious lending environment or selective financing. Cash transactions remain dominant at 68% but declined slightly, while mortgage transactions grew by over 10%, reinforcing a shift toward leveraged purchases. Investors should prioritize assets in the primary sector with stable volumes and approaching price growth, while monitoring mortgage-driven transactions for early signs of credit stress or market overheating. Focus on transaction-backed price movements rather than listing prices to avoid mispricing risks in portfolio allocations.