Dubai Real Estate Prices Surpass 2008 Peak Amid Record-Breaking Sales in Early 2025

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The Dubai property market started 2025 with a surge, recording property sales worth AED 51.1 billion (approximately $14 billion) in February. This marks a 39.91% increase compared to the same month in 2024, reports Khaleej Times. Property prices continue to rise, now surpassing many global capitals. Experts are voicing concerns about a potential new real estate bubble forming, which could burst soon.

According to a report by fäm Properties, there were 16,099 property transactions in February, up 35.5% year-on-year. Data from DXBinteract shows villa sales nearly doubled—up 99.7%—to AED 18.8 billion ($5.12 billion) across 3,679 contracts. Land transactions rose by 74.7% to AED 9.6 billion ($2.61 billion) across 608 deals, while apartment sales increased by 21.3% to AED 21.4 billion ($5.83 billion) with 11,364 units sold.

Commercial property transactions reached AED 1.2 billion ($327 million), up 40.1% year-on-year. The average price per square foot rose by 3.4% to AED 1,551 ($423).

Over the past five years, Dubai’s real estate sales volume has increased by 449%—from AED 9.3 billion ($2.53 billion) in 2020 to AED 51.1 billion ($14 billion) in 2025. The most expensive property sold last month was a luxury villa in Hadaeq Sheikh Mohammed Bin Rashid for AED 140 million ($38.12 million). An apartment in The Rings-1, Jumeirah Second, sold for AED 116 million ($31.59 million).

The primary market accounted for the majority of activity, with 66% of transactions and 62% of total value. Properties priced above AED 5 million ($1.36 million) made up 9% of all sales, while those in the AED 1–2 million range ($270,000–$540,000) accounted for 31%, and units under AED 1 million represented 25%.

Ray Verma, a luxury real estate broker at Eden Realty UAE, noted that Dubai property prices are up 27% compared to January 2024, with villa prices rising by 31.2%. This growth outpaces cities like London, Paris, and Madrid, and surpasses the previous 2008 peak, which was followed by a sharp market crash, according to the Financial Times.

Bloomberg experts have also expressed doubts about the long-term sustainability of Dubai’s real estate market. They foresee a potential slowdown and urge caution when investing in new developments. Even developers acknowledge this. Emaar’s chairman, Mohamed Alabbar, stated that price increases must be managed carefully, or they could backfire. He emphasized that Dubai must continue to attract new residents to occupy the influx of housing and simultaneously fight inflation and rising living costs.

Developer Danube has started offering one-bedroom apartments at studio prices. "I don’t think prices will keep rising at the same pace due to increasing competition," explained Talal Al-Gaddah, Senior Executive VP at MAG. He added that developers will begin undercutting each other to gain market share.

In addition to high prices, buyers now face higher upfront costs starting February 2025. Banks have stopped financing Dubai Land Department (DLD) fees (4%) and 2% broker commissions, meaning buyers must pay these costs out of pocket. For a AED 1 million ($272,000) transaction, this adds AED 60,000 ($16,336) in upfront fees.

It’s also important to note that Dubai updated its Golden Visa rules: investors must now make a minimum 50% down payment on off-plan properties, and no mortgage is allowed for ready properties.