Dubai real estate prices fall for the first time in two years

Dubai’s real estate prices have fallen for the first time in more than two years. In January 2025, prices dropped by 0.57%, showing that the market is slowing down after growing for a long time. This is the first price fall since mid-2022, according to Property Monitor, a company that studies the real estate market.

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Even though prices went down, the number of property sales in January 2025 was the highest ever recorded for this month. A total of 14,413 properties were sold. However, the average price per square foot fell to AED 1,484. Sales numbers also dropped by 4.6% compared to December 2024, meaning fewer people bought properties.

New property projects continued to grow. In January, 37 developers launched 53 new projects, bringing 12,400 new homes to the market. Mortgage activity also increased, with 4,134 home loans taken, which is 6.8% higher than the previous month. Loan rules stayed the same even though the UAE Central Bank made sure banks followed the regulations more strictly.

Zhann Jochinke, the Chief Operating Officer of Property Monitor, said that Dubai’s property market is now slowing down after growing for four years. He explained that high prices have made it harder for some people to buy homes, and the market is starting to settle. He added that Dubai’s real estate market is moving from fast growth to a more stable and balanced phase, where supply and demand will decide future prices.

The report also showed the average price of different types of homes. The median price for an apartment was AED 1.35 million. For townhouses, it was AED 2.61 million, and for villas, it was AED 6.91 million.

Off-plan sales, where buyers invest in homes before they are built, made up 52% of all sales in January. A total of 7,555 off-plan properties were sold, but this was 17.7% lower than in December 2024. At the same time, sales of ready-to-move-in homes increased by 15.7%, making up 47.6% of total sales.

Emaar Properties was the top seller in off-plan sales, with a 16.5% market share. Damac Properties followed with 15.8%, while Danube Properties had 5.3% of the sales.

The most expensive property sold in January was a villa in Emirates Hills, which was bought for AED 425 million. The cheapest sale was a studio apartment in Dubai Production City, which sold for AED 175,000.

The report suggests that Dubai’s property market is entering a new phase. Prices are not rising as fast as before, and a balance between supply and demand will decide how the market moves in 2025 and beyond.