According to analysts at S&P Global, property prices and rents in Dubai are expected to remain stable over the next 18 months but could decline thereafter due to an influx of new supply from numerous project launches post-pandemic.
In a recent note, S&P Global highlighted that the Dubai property market remains resilient, largely unaffected by regional geopolitical tensions, thanks to strong demand from both local and international investors, along with recent visa reforms enhancing stability.
The report indicates that rental growth will stabilize as the supply of available units increases, particularly in non-prime areas starting in 2025. Sapna Jagtiani, primary credit analyst at S&P Global, noted that the market could see around 182,000 new residential units delivered between 2025 and 2026—significantly higher than the average of 40,000 units delivered annually from 2019 to 2023.
While demand has been robust, Jagtiani cautioned that the rate of inventory absorption will depend on Dubai’s population growth, projected at approximately 3.5% over the same period. Although 2024 deliveries have lagged behind those of 2023, potential delays in construction could tighten the market and sustain upward price trends in the short term.
S&P Global anticipates Dubai’s population will reach 4 million by 2026, bolstering demand for real estate. The report notes that off-plan sales in Dubai are currently double that of the secondary market, with buyers willing to pay a premium for new constructions.
Despite geopolitical uncertainties, S&P expects Dubai’s economy to remain resilient, projecting an average GDP growth of around 3% from 2024 to 2027. Additionally, the pace of new project launches is expected to slow over the next 12 to 24 months, as the market adjusts to current supply levels.
As developers shift focus to affordable and mid-market properties, the share of luxury developments is predicted to decrease in 2025, reflecting changing market demands.
