Dubai's residential property market experienced robust growth in 2024, with prices soaring by 19.1% over the past year, reaching AED 1,685 ($459) per square foot, according to the Dubai Residential Market Q4 2024 report from global property consultancy Knight Frank. This marks a 13.3% increase from the market’s previous peak in 2014.

Villas, in particular, saw even greater appreciation, with sale prices rising by 20.2% over the last 12 months to AED 2,009 ($547) per square foot, placing them 38.1% above their 2014 peak. This trend underscores the strong demand for stand-alone villas, beachfront homes, and branded residences, which offer immediate access to Dubai’s luxury lifestyle.

Knight Frank reports that 302,880 residential units are currently under construction, set for completion by 2029. Of these:

• 80% will be apartments
• 18% will be villas
• 2% will be branded residences

This translates to approximately 60,576 new homes per year over the next five years, surpassing Dubai’s long-term average completion rate of 36,000 homes per year. However, historical trends indicate a 30% lag in actual completions, with only half of the 60,000 homes promised for 2024 being delivered.

Despite increased supply, demand remains exceptionally strong, driven by both domestic and international buyers. Investment from Russia surged by 20% in 2024, particularly in luxury locations like Palm Jumeirah, Downtown Dubai, and Dubai Marina.

The availability of ultra-luxury properties in Dubai has significantly decreased:

• Homes priced at $10 million+ dropped 40%, from 4,119 to 2,491 units.
• Homes in the $25 million+ bracket saw an 85% decline, from 583 to just 86 properties over the past year.

Dubai’s prime residential market, which includes Palm Jumeirah, Jumeirah Bay Island, Jumeirah Islands, and Emirates Hills, has seen an exceptional surge in value. During Q4 2024, average transaction prices in these elite areas rose by 16.9%, reaching AED 6,627 ($1,805) per square foot compared to Q4 2023.

With property values on an upward trajectory and luxury real estate inventory shrinking, demand is expected to remain strong despite new supply entering the market. Factors like access to greenery, wellness centers, and waterfront locations continue to attract high-net-worth investors, further fueling Dubai’s real estate boom into 2025.