Dubai’s real estate market experienced significant growth in 2024, with residential property values increasing by 19.1% over the past year, reaching AED 1,685 per square foot, as reported by global property consultancy Knight Frank. This puts the average price 13.3% higher than the 2014 peak.
Villa prices saw even stronger growth, rising by 20.2% to AED 2,009 per square foot—38.1% above their 2014 peak. The demand for standalone villas, beachfront homes, and branded residences continues to drive this price surge.
“Residential property values remain on an upward trajectory, with demand showing no signs of abating, both from domestic and international buyers,” stated Faisal Durrani, partner – head of research, MENA.
Dubai’s Residential Supply: 302,880 New Units by 2029
According to the report, Dubai’s real estate sector currently has 302,880 residential units under construction, set for completion by 2029. Of these, 80% are apartments, 18% are villas, and 2% are branded residences. This equates to around 60,576 new homes per year—well above the long-term completion average of 36,000 homes annually.
Despite this supply increase, the number of ultra-luxury homes available for sale has dropped. Properties priced above $10 million saw a 40% decline, with availability falling from 4,119 to 2,491 homes in the past year. Meanwhile, listings for homes priced at $25 million or more declined even faster, from 583 to just 86 properties.
“In this cycle, we have noted a rise in genuine end users, rather than speculative purchasers that have defined previous cycles. This change is reflected in the fact that there has been a 30 percent reduction in homes available for sale across the city last year, with the prime markets in the city experiencing an even more acute 52 percent reduction in home listings. It’s villas though where the attention of the global super-rich remains focused, with values rising by 20.2 percent last year, reflecting a 99.8 percent uplift on Q1 2020 price levels,” added Durrani.
Prime Residential Market Prices Increase by 16.9%
Luxury real estate in Dubai’s prime neighborhoods—Palm Jumeirah, Jumeirah Bay Island, Jumeirah Islands, and Emirates Hills—also saw a substantial price surge. In Q4 2024, average transaction prices in these elite areas hit AED 6,627 per square foot, a 16.9% rise compared to Q4 2023.
“Dubai’s luxury market has cemented its status as a safe haven for international and local luxury buyers with another record-breaking year for the US$ 10 million homes market registering 435 deals over 2024, 153 of which were recorded in Q4 alone making it the highest figure recorded in one quarter on record for this segment,” stated Petri Mannila, partner – prime residential, Dubai.
Dubai’s Office Market: Rents Rise 9.1% in H2 2024
The commercial real estate market also experienced robust growth in 2024. Office lease rates in key submarkets increased by an average of 9.1%, with the highest growth recorded in the Trade Center District, where rents surged by 96%.
“Dubai’s office market continues to experience rising levels of demand in the form of new business entrance as well as expanding businesses. This rising demand means that prime office space is in exceptionally short supply city-wide,” added Durrani.
Knight Frank noted a substantial 1.28 million square feet of new office space demand in 2024, marking a 64% increase from the previous year. The main sectors fueling this demand include business services, real estate, and banking & finance, collectively accounting for 843,111 square feet of new office space needs.
By 2028, Dubai’s prime office supply is projected to grow to 8.2 million square feet—an 86% increase compared to the 4.4 million square feet delivered between 2021 and 2024.
New Office Locations Gain Popularity Amid High Demand
Occupancy rates in Dubai’s top business districts—DIFC, Downtown Dubai, and Business Bay—range between 95% and 99%, driven by strong tenant demand and limited new supply. This has pushed rental rates up significantly, with Business Bay seeing a 46% price increase.
With prime office space in the city nearing full capacity, businesses are exploring alternative locations. Areas such as Dubai Science Park and Expo City are gaining attention due to their modern facilities and competitive rental prices.
“Occupiers remain driven by quality and we are seeing businesses migrate outside of central Dubai to newer locations where office space is available. With prime space in Dubai’s key business districts nearing full capacity, companies are finding new areas to expand into. Locations like Dubai Science Park and Expo City are experiencing increased interest, with occupiers drawn by state-of-the-art facilities and attractive rents,” noted Adam Wynne, partner – head of commercial agency, Dubai.
Dubai’s real estate market continues to demonstrate its resilience, with both residential and commercial segments experiencing notable growth. With strong demand, increasing property values, and shifting preferences in luxury and office spaces, the city remains a prime destination for investors and businesses alike.
