The United Arab Emirates’ real estate sector is powering ahead in 2025, with surging property sales, robust foreign investment, and an ever-expanding skyline in both Dubai and Abu Dhabi. According to recent international reports and data from JLL, the market’s momentum is showing no signs of slowing, as new projects break ground and investors—both local and international—flock to capitalize on the UAE’s stable, business-friendly environment.
Dubai, often seen as the flagship of the country’s property boom, posted a staggering AED153.7 billion ($41.9 billion) in property sales during the second quarter of 2025. That’s a 44.5 percent jump compared to the same period last year, as reported by JLL. Abu Dhabi, the capital, isn’t lagging behind either; average sales prices there climbed by 12.1 percent in the same period, and total sales transactions rose by 9.1 percent, buoyed by a remarkable 32.6 percent surge in the secondary market.
What’s fueling this relentless growth? A combination of factors, it turns out. The UAE’s population has now surpassed 11 million, placing upward pressure on both rental and sales markets. With more people comes more demand for homes, offices, and all the infrastructure that supports a thriving urban life. As noted by Mercer in its 2025 Middle East Housing and Schooling Report, rental prices in Dubai and Abu Dhabi have been climbing at high single-digit to double-digit rates over the past four years, prompting companies to increase housing allowances by an average of four percent to help employees keep pace.
Off-plan properties—those sold before construction is completed—have become the darling of investors and buyers alike. JLL’s latest report highlights that these properties led the market in both Dubai and Abu Dhabi during the first half of 2025, thanks in part to a wave of new project launches. Approximately 32,400 residential units are currently under construction in the two emirates, a testament to the market’s ability to meet soaring housing needs.
The rental market, too, remains remarkably stable. Tenants in both Abu Dhabi and Dubai are showing a preference for renewing existing contracts, which contributed to a 9.4 percent year-on-year increase in lease contracts in Abu Dhabi and an 11.5 percent rise in Dubai during the second quarter. This stability is a boon for landlords and offers reassurance to investors looking for steady, predictable returns.
As property prices and rents climb, UAE companies are feeling the pressure to stay competitive in the talent market. According to Mercer, 70 percent of UAE firms now offer a separate housing allowance, while 25 percent include housing in a consolidated allowance. The rest provide total cash packages. In a market where large upfront rent cheques are common, 52 percent of employers now offer housing allowances in advance. As Aleksei Kolesnik, career products manager at Mercer Middle East, put it: “As competition for talent intensifies in the region, employers must ensure they have a strong employee value proposition, including market-competitive allowances and benefits.”
Andrew El Zein, Mercer’s UAE career products leader, echoed this sentiment: “This enhances the employee value proposition and helps organizations acquire the right talent to fuel their growth ambitions, especially at a time when attracting top talent is crucial for business success.”
But it’s not just about residential real estate. The UAE’s office market is also expanding rapidly. Abu Dhabi added 78,000 square meters of office space in the second quarter of 2025, bringing its total to 4.6 million square meters, with another 66,000 square meters expected by year’s end. Dubai, meanwhile, added 24,000 square meters, reaching a total of 9.3 million square meters. Looking ahead, the Dubai International Financial Centre is set to deliver a whopping 264,000 square meters of premium office space in 2026, further cementing the city’s status as a regional business powerhouse.
The numbers paint a picture of a market in full bloom. Statista projects that the UAE real estate market will reach $693.53 billion by the end of 2025, with the residential segment leading at $401.81 billion. The sector is expected to grow at an annual rate of 2.28 percent until 2029, ultimately reaching $759.04 billion. The real estate services market alone is estimated at $18.45 billion in 2025 and is forecast to expand to $24.75 billion by 2030, reflecting a compound annual growth rate of 6.05 percent, according to Mordor Intelligence.
Luxury properties are in especially high demand, with high-net-worth individuals driving the market for villas, penthouses, and premium towers. In some areas of Dubai, such as Jumeirah Islands, villa prices have soared by up to 41 percent. No wonder the country is solidifying its reputation as a global investment destination.
Government policy continues to play a pivotal role in this growth story. Initiatives like the Dubai Land Department’s blockchain-powered property transactions have enhanced transparency and security, while the Golden Visa program—tied to property ownership—has attracted wealthy individuals and families by offering long-term residency benefits. These measures, combined with ongoing digital transformation, have made the UAE a beacon for international investors.
Nor is the boom confined to residential and office real estate. The industrial and logistics segments are expanding rapidly, thanks to the UAE’s position as a global trade hub and the explosive growth of e-commerce. Areas like Dubai Industrial Park and Khalifa Industrial Zone Abu Dhabi (KIZAD) are magnets for companies seeking advanced warehousing and distribution centers. The demand for data center real estate is also rising, in line with the country’s ambitions in digital economy, 5G, and AI-driven services.
Geographic diversification is another hallmark of the current market. While Dubai and Abu Dhabi remain the flagships, other emirates like Ras Al Khaimah are projected to achieve the highest real estate growth rates in the coming years. Sharjah and Ajman are also drawing investors, thanks to more affordable housing options and ongoing infrastructure developments.
Looking ahead, the market is expected to rebalance as supply catches up with demand. More than 150,000 new homes are set to be delivered in Dubai alone between 2025 and 2027, which should offer buyers more choice and lead to more stable price dynamics. Analysts predict a moderation in price growth, though the market’s fundamentals remain strong.
Financing options are evolving, too. Competitive mortgage products, flexible loan-to-value policies, and emerging models like crowdfunding and tokenization are making it easier for a broader range of investors and homeowners to participate in the market.
As the UAE’s real estate sector continues its dynamic ascent, the country stands as a testament to what’s possible when innovation, policy, and global ambition intersect. Investors, residents, and businesses alike are betting big on a future that’s only getting brighter.
