Despite concerns about a potential “Dubai property bubble,” the UAE real estate market continues to show strong fundamentals and steady growth. Recent data from Markaz and other market reports highlight rising transactions, attractive rental yields, and supportive economic and monetary conditions, all indicating that the market is robust, not speculative.
Real estate activity across the UAE remained impressive in 2025:
- Dubai real estate transaction values rose 28.3% year-on-year to AED 554.1 billion.
- Abu Dhabi total property sales reached AED 58 billion, a 75.8% increase, with the number of transactions climbing 42.3% to 15,800.
- Rental yields in Dubai stood at 7.47%, significantly higher than global cities such as Singapore, New York, and London.
According to Markaz’s Real Estate Outlook: H1 2026, higher oil production, growth in the non-oil economy, continued government spending on infrastructure and development projects, along with policy rate cuts, are improving liquidity and credit growth. This supports borrowing and investment activity across residential, commercial, and industrial real estate segments, providing a strong foundation for continued market growth.
While some observers have expressed concerns about sustainability, the current growth cycle is underpinned by real economic fundamentals. Market moderation or a cooling phase may occur in the medium term, but the likelihood of a sharp correction is low. In fact, Markaz forecasts that the UAE real estate market could peak in H1 2026, with steady growth in both prices and rental rates across Dubai and Abu Dhabi.
In short, with strong transaction growth, high rental yields, and supportive macroeconomic conditions, the UAE real estate market is stable, mature, and highly attractive for investors.
Key takeaways for investors:
- Dubai and Abu Dhabi are experiencing real, sustained growth, not speculative bubbles.
- Rental yields remain competitive globally, providing reliable income.
- Macroeconomic factors, government spending, and accommodative monetary policy support liquidity and continued investment.
Contact Diamond City Real Estate today to discover the best investment options in one of the world’s most dynamic real estate markets.