The price of the square of the apartment in the city center increased by 122 percent in five years, but the new wave of customers creates a more stable market than previous cycles.
Dubai is experiencing real estate boom again, but it seems that this time it has a stronger foundation than in earlier cycles. According to Deutsche Bank, apartment prices in the city center increased by 122 percent in the last five years. This is the second largest increase in the price of the 69 world cities that the Bank monitors, writes the Economist.
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Until August this year, the total sales of real estate has reached 441 billion dirham ($ 120 billion), which is a third more than in the same period 2024. residential real estate prices are now greater than in the record year 2014. years.
The new customer profile changes the market
Unlike previous cycles, this wave boom launch mostly new residents who immigrate to Dubai, instead of those who buy real estate just to resolve them quickly. The UAE population has grown to 11 million, which is a growth of 20 percent compared to 2020. year.
“The newcomers are better educated, younger and faster, real estate owners,” explain brokers. Among them are British residents dissatisfied with the quality of life in the UK, African entrepreneurs working from the house, as well as Europeans in search of tax benefits.
Henley & Partners Consulting Company estimates that the number of millionaires in the Emirates will increase by 9,800 this year – more than anywhere else in the world.
Infrastructure monitors growth
The data of local service providers confirm realistic growth: Dubai Elektroprivreda (DEWA) increases from 24 percent of electricity and water users from 2020, while Toll Operator Salik reports nine percent more registered vehicles in the first quarter of 2025. Years.
Prestigious schools like Harrows open their branches in Abu Dhabi and Dubai. At the same time, employers are looking for more and more office space – empty rentals for rent now have at least in the last ten years.
Moderate speculation, stricter regulations
The key difference compared to previous cycles is the reduction of speculative activities. Less than 5 percent of customers now resell real estate within a year, versus 17 percent in 2014.
Large construction companies have also become more careful. According to the Moody’s Agency, they now require customers to pay 80 percent of the apartment in advance before the start of construction, instead of earlier 50 percent. Thus advantage more money and more money are easier to finance projects.
In addition, the authorities introduced stricter measures against money laundering, seeking evidence of the origin of cash purchases and mandatory Escrow accounts for construction projects.
Despite growth growth, Dubai remains relatively accessible. According to the consulting house Savills, shopping and maintenance of real estate worth 2 million dollars are cheaper than in Bangkok, London, Mumbai or New York. Mortgages are among the most favorable in the world in relation to revenues, and the new program for first real estate buyers further reduces costs.
Challenges of future growth
However, real estate counselors warn that the factors that encouraged the previous Boom are exhausted. Russian billionaires who bought real estate after the beginning of the war in Ukraine no longer come as earlier, and neither Indian businessmen and bolivud stars leaving Mumbai and moved to Dubai.
The cryptomillionaires that invest in luxury real estate is also less. The problem is also the growth of life costs in Dubai.
Import products such as beer and clothing have risen, which refuses to the middle-class strangers. However, despite the warning of possible prices, the market currently operates more stable than earlier speculative waves that ended with dramatic falls.
