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Will Property Prices Increase In 2025? Key Trends To Look Out For

By admin,April 9, 2025

Dubai’s record-breaking number of transactions for 2023-2024 has made buying property a popular option among residents. While these figures have unlocked significant investment potential for Dubai’s inhabitants, a pressing question remains: Will property prices increase in 2025?

The answer lies in front of you, as the real estate trends of 2025 are your forecast pickup points. In this blog, let’s gather insights on the latest Dubai real estate trends and how the current Dubai property market can benefit you.

Overview of Current Housing Market Conditions in Dubai

Before we get an answer to the question, “Will property prices increase in 2025?”, let’s look at the current housing conditions in Dubai.

Off-plan properties are everywhere, and so are the investors. It’s true because the flexible payment options and developer incentives have opened doors for first-time hom e buyers who want to escape the matrix of rising rental costs.

One of the factors contributing to the Dubai property price increase is the change in mortgage regulations, which will require buyers to cover certain upfront costs, such as the 4% Dubai Land Department (DLD) fee and the 2% agent fee, instead of allowing banks to handle these additional fees along with the 80% mortgage financing.

Mainly this rule was introduced by UAE authorities to create a financially responsible and sustainable economy, which is in line with practices in the US and UK. But how is the UAE economy still making successful transactions even with these shifts? Let’s explore this further.

Why Dubai Property Prices Are Expected to Rise in 2025?

Dubai’s property market wants to maintain the pace of its demand and supply. As a result, property prices are expected to rise, especially considering the UAE government’s recently announced initiatives for residential expansion.

So it’s established that Dubai’s property market wants to maintain the pace of its demand and supply and this price hike is closely related to the government’s sustainability and growth-friendly objectives.

Firstly, the supply of homes in Dubai is expected to rise compared to the previous year, with a forecasted 41% year-on-year surge in residential handovers. So, if you’re a potential homebuyer or investor for this year or shortly, the supply of additional properties could be an investment opportunity for you.

Moreover, with “one residential project launch every 15 hours” in 2024, the interest in off-plan properties has sustained from 2024 until today. This means that some people may be shifting from renting to considering homeownership, especially in prime locations like Jumeirah Village Circle (JVC) and Dubai South, largely due to more affordable options.

Therefore, all these changes are an eye-opener for investors’ new investments, as Dubai aims to lead by proving peak sophistication in property development while incorporating sustainability measures in projects. In Dubai’s real estate market, every change signifies a new trend, and each trend is driven by specific factors.

Key trends shaping the housing market in 2025

In Dubai’s real estate market, every change signifies a new trend, and each trend is driven by specific factors. So, speaking of property prices, Dubai is hands down the top choice among local and international buyers.

Predictions for the 2025 housing market in Dubai

Here are the key factors and trends affecting Dubai housing market in 2025:

Economic performance: 2025 is the year for luxurious residency in Dubai. With many mid-housing opportunities emerging, the price increase is not quite surprising. This increase is evident in rental rates and sales prices, particularly alongside the expanding population. With inflation at 3.15% in January 2025, it makes sense that this could lead to sustained demand for off-plan properties, rising mortgage rates, and increased costs for running businesses.
Sustainability will lead: The Mohammed Bin Rashid Housing Establishment (MBRHE) and Wasl Group signed a Memorandum of Understanding (MoU) in 2024 to promote the quality of life for UAE residents. This is a push for the UAE to engage in environmentally friendly practices for the construction and design of properties in Dubai. You can see notable examples of projects like Sustainable City in Dubai, Masdar City in Abu Dhabi, and Al Zorah in Ajman, which use eco-friendly infrastructure and renewable energy technology for housing.
Growing demand for Community-centric living: Dubai housing supply and community-centric living is no longer just a trend; it’s a demand. With UAE’s 2025 Year of Community initiative setting the stage, people’s convenience is prioritized the most. That’s why you can see many metro lines and new buses opening in line near business hubs, metro stations, and schools. Ultimately, 2025 is where community living is the ultimate residential experience. And with projects like the Urban Master Plan like 2040, you can expect more such community-oriented changes in the upcoming years.

|| Check Out: How To Check Your Property Value in Dubai: Free Online Calculator ||

Predictions for the 2025 housing market in Dubai

The Dubai real estate forecast for 2025 means significant improvements, except it comes with a fair price. The most popular discussed predictions include:

Palm Jumeirah, Downtown Dubai, and Dubai Harbour are slowly gaining the spotlight for higher rental yields, meaning the appreciation may increase.
Since investment in off-plan properties has been high for the past 2 years, you can expect a potential surge in property ownership in the coming years and 2025 is the start.
Dubai is both tourism and resident-friendly, meaning residencies will combine hospitality as well as short-term benefits for people in terms of financing and housing options.
Don’t be surprised by the increased foreign investments and property demands from expats, as long-term visas and tax-free property ownership have made it easy for all.

Is it a good time to invest in Dubai now?

With the shift in property prices and demand, you might be wondering if now is the right time to invest in property in Dubai. The simple answer is yes! The years leading up from 2025 will present many attractive opportunities and lifestyle benefits for Dubai residents, and you don’t want to miss out.

So, don’t let fluctuations in property prices dictate your decisions. At AZCO Real Estate, we understand your budgetary needs and know how to align them with your dream property. Let this guide be your first step toward making the best investment.

Click here to get in touch with us NOW!

Wrapping up: Will property prices increase in 2025?

Dubai’s real estate sector in 2025 promises a bright future for people It also presents an opportunity for buyers, investors, and tourists to make the most of their experience in the UAE.

As one of the few economies that remained resilient post-pandemic, the developments and initiatives undertaken have proven to be beneficial, keeping Dubai a step ahead of other global cities.

So, if you’re wondering, “Will property prices increase in 2025?” the answer is yes, based on expert insights and the current situation of the UAE housing market in 2025.

Frequently Asked Questions

1. What will Dubai look like in 2025?

According to the latest plans and reports, the city aims to complete 19,700 villas by 2025 to keep up with the rising demand from investors and residents. Other changes include infrastructure that is equally sustainable and innovative in nature.

2. Will Dubai rents drop in 2025?

With an increase in housing supply, demand is expected to rise. This indicates that rental prices in Dubai will likely experience slight upward fluctuations, but a significant decline is not anticipated.

3. Will property prices increase in 2025?

As the city’s population continues to grow, the demand for housing and properties is rising. This increased demand may lead to a significant rise in property prices, especially if demand keeps growing like this.

Brace Yourselves for Up to 20% Increase in Rent

By admin,March 18, 2024

Understanding the Impact of the Rera Calculator Update

Dubai’s real estate market is again in the spotlight following recent revision of Real Estate Regulatory Authority (Rera) calculator and trends that affect both landlords and tenants. This update is effective from March 1st and is likely to shake rental landscape especially among tenants who have called Dubai home over 2 years. Mr. Khurram Farooq- CEO Azco Real Estate Brokers LLC. throws more light into this development and stresses that tenants could be exposed to higher rent increments upon renewals than it was under the previous system.

Navigating Rental Dynamics in Dubai: Insights from Industry Experts

Industry executives see a big jump in rents with increases expected range between 10 – 20% in the near future. This readjustment will impact places where there have been significant hikes in rents during the last 2 years like central villa communities, waterfront apartment complexes etc.

Insights from Mr. Khurram Farooq – CEO Azco Real Estate Brokers LLC.

Mr. Farooq gives valuable insights regarding this revised calculator’s implications for tenants. As much as immediate fears would be about increased tenant rental costs, Farooq remains positive about their long-term effects. He opines that the revised calculator can create a more balanced market and consequently reduce open market rents slightly.

Khurram Farooq

Identifying Areas of Maximum Impact: Central Villas and Waterfront Apartments

The revision in Rera calculator disproportionately affects certain areas such as central villa communities and waterfront apartments. These regions are popularly demanded implying they may be affected most by these rent hikes within the next few months.

Assessing Projected Rent Hikes: 10-20% Increase on the Horizon

Industry experts are expecting rents to increase between 10% to 20%, hence residents should brace themselves for any potential financial adjustments. While this sudden increase would have both near and far-reaching impacts on the real estate market of Dubai.

Long Term Outlook: Balancing the Rental Market Dynamics

Mr. Farooq sees these challenges as short term and believes that the recalibrated calculator will bring a positive transformation to the market. This is where he suggests that increased renewal costs may lead to heightened activity in the market, which may result in more homes being built and ultimately stable rents for everyone.

Optimism Amidst Immediate Challenges: From the Lens of Mr. Khurram Farooq

Mr. Farooq’s optimism stems from his belief that the previous calculator created a big gap between renewal prices and market rates which caused stagnation in the market dynamics. By addressing this disparity, Dubai’s real estate sector can potentially achieve greater equilibrium and resilience during such volatile times.

Anticipating Market Resilience: The Ripple Effects of Recalibrated Rent Calculations

The wider implications of adjusted rental calculator go beyond individual deals to encompass a larger part of Dubai’s property landscape. As tenants prepare for potential rent hikes, landlords may be able to enjoy better position thus strengthening responsiveness within their markets.

Tenant Considerations: Strategies for Adapting to Changing Rental Trends

The changing rentals and the choice between moving out and buying property are leading to different considerations by tenants. Some may prefer to reduce space or move just to avoid increased rent costs while others will take the chance of entering the real estate sector.

Dubai’s Real Estate Evolution: Navigating the Path Forward Dubai’s real estate industry remains dynamic with the global market following suit, where it has adapted and embraced fluidity in response to regulatory changes and economic shifts. In this ever-changing environment, residents and investors have begun adjusting themselves accordingly knowing that re-calibrations done on Rera calculator is a sign of its resilience and innovation capacity.

Increase in Dubai Rents Drives Tenants to Choose 12-Month Cheques or Direct Debits

By admin,March 13, 2024

Dubai’s housing sector is experiencing dramatic shifts as tenants are dealing with ever-increasing rents on yearly leases. A growing number of mid-market residential area residents are now seeking a paradigm shift in the traditional payment arrangement due to rising costs. Tenants have recently turned to monthly direct debits, attempting to find an approach to money management that suits them best. With all these questions arising, will landlords go along with such changes and what problems will they face together?

The Rise of Monthly Direct Debits

This has made tenants ask their landlords to allow them to pay their rentals through monthly direct debits after the recent RERA Rent Index revisions resulted into a higher rise in rents. This process involves withdrawing rent straight from the tenant’s bank account, which provides for more efficient way of fulfilling payment requirements. This move is mostly felt in mid-market residential areas where residents have been hit hardest by adjustments in rental rates.

Monthly Payments: A Solution for Budget Management

To lessen the burden on struggling tenants, rent payments can be deducted monthly thus obviating the need for sufficient funds during cheque submission time. Bounced cheques are becoming more frequent and this has negatively affected relationships between the tenant and landlord as well as credit scores being downgraded sometimes. In UAE bounced cheques do not attract criminal charges, therefore tenants are looking for secure alternatives.

Direct Debit System’s Perspective

The Direct Debit System CEO Ummair Butt says that 96% of the UAE population falls under a group whose salaries are paid on a month-to-month basis hence implying that direct debit should mimic payday cycle accurately. According to Butt allowing deductions every month causes reductions in bounced payments equaling 41%, which makes it possible to maintain life amid rising costs.

Landlords’ Reluctance and Current Adoption

Although some landlords are already offering 12-cheque options or monthly debits, however their numbers remain very limited. Physical cheques issued by tenants are trusted because of old fashioned mentality surrounding landowners. According to Usman Jameel, Sales Manager at Azco Group, millennials who are more comfortable with digital payments have adopted direct debits the most. Real estate experts argue that this change may take a while because landlords are used to having physical checks as method of payment.

Challenges & Factors Affecting Adoption

Landlords face several issues to implement a direct debit system even if it has numerous advantages. These include ‘assignment of receivables’ and the need for a ‘legal alternative’ to cheques. Due to multiple bank loans against various real estate assets, Landlords may find it difficult to divert their income through different banks.

Cost Implications for Landlords

Digital alternatives may be resisted by landlords who always look into costs in their business. Additionally acquiring charges on credit cards payments is 2% while direct debits on credit cards attract a fixed fee of Dh7. Even with processing fees being paid, traditional cheques remain safe instruments for the landlord.

The Bottom Line

Dubai’s real estate market is gaining traction in its adoption of monthly direct debits as tenants seek financial flexibility amidst soaring rents. Nevertheless, while obstacles and conventional thinking persist, the possible gains to be had by both tenants and landlords may set the stage for a gradual change in payment options. It will take a few years before we can see if monthly direct debit becomes one of the widespread features in Dubai’s rental market which is changing over time.

For those seeking rental solutions or landlords considering alternative payment methods and Azco Real Estate Brokers provides tailored services to meet your needs. Contact Azco today to explore how we can help navigate Dubai’s rental market and facilitate smoother transactions, including the adoption of monthly direct debits. Start your journey to financial convenience with Azco Real Estate Brokers.