Through new research, international ratings agency S&P Global predict that property prices and rents within the Dubai property market will remain stable over the next 18 months.
However, after that period, both could fall due to the increased supply of accommodation choices in the pipeline.
S&P Global stated that Dubai’s property market will remain resilient. The research highlights that there has been no impact of the regional geopolitical conflict on the local market, thanks to demand from local and international investors.
“Property prices will remain stable over the next 18 months and could decline afterwards due to increasing supply. “A potential increase in supply could saturate the unfulfilled demand, and lead to lower prices and rents.
“The market expects residential supply stock will increase by about 182,000 units over 2025-2026, given that the large number of properties that were presold over 2022 to 2023 will be delivered.
“This is significantly higher than the average of 40,000 units delivered per year over 2019-2023.”
Sapna Jagtiani, Primary Credit Analyst, S&P Global
Rents and property prices in most of Dubai’s areas have been consistently on the rise due to unprecedented demand in the post-Covid world.
Continued population growth, expected to rise by around 3.5% over 2025 to 2026, and investor demand, is keeping the market buoyant. S&P Global expects Dubai’s population to reach four million by 2026.
“So far though, deliveries in 2024 have not kept pace with those in 2023. Significant delays in delivery, which are not uncommon for the industry – often due to construction capacity constraints – could tighten the market and support upward price trends, at least over the short term. Yet we expect the residential real estate market to balance out by 2026 at the latest.”
Sapna Jagtiani, Primary Credit Analyst, S&P Global
Dubai has launched the D33 agenda to push the growth of the real estate market and attract more foreign direct investment into the sector.
It comes as an increasing number of millionaires are migrating to UAE. 128,000 millionaires are expected to relocate in 2024, beating the previous record of 120,000 set last year.
