Dubai is experiencing a notable drop in the number of homes priced below Dh1 million as heightened buyer activity continues to absorb affordable stock at a rapid pace.
According to new market analysis released by Knight Frank, listings under the Dh1 million bracket fell by 14 percent during the first nine months of 2025. Sales in the same segment rose by 10 percent over the same period, highlighting sustained demand from both residents and investors seeking lower-priced units after five years of strong price growth.
Knight Frank’s review also shows an increase in listings around the Dh1.25 million range, although transactions in this band are rising more quickly. The consultancy notes that homes are selling faster than new inventory is being added.
Despite speculation about a broader slowdown, Dubai’s residential market continues to hold steady. Most price segments remain active, supported by consistent buyer confidence and ongoing population growth.
The only deviation appears in the ultra-luxury segment above Dh25 million, where stock is accumulating at a faster rate than sales. Knight Frank attributes this partly to developers shifting toward luxury and super-luxury projects to capture demand from international buyers.
Five-Year Run of Growth Continues
Dubai maintained its momentum through the third quarter of 2025. Knight Frank reports that average residential prices rose 2.5 percent in Q3, extending the city’s streak of quarterly price increases that began in late 2020. Overall values now stand about 10 percent higher than the same period last year.
Transaction volumes remain elevated. Residential deals for the year to date have surpassed Dh310 billion, placing 2025 among the strongest years on record. Q3 contributed Dh117 billion in transactions, slightly above the same quarter in 2024.
Knight Frank notes that price growth is starting to moderate after several years of rapid increases. Average quarterly growth was just over 2 percent in 2021 and 2022, peaked in 2023 and 2024, and has eased to roughly 3.2 percent across the first three quarters of 2025.
Apartments recorded a 2.3 percent quarterly rise in Q3, supported by strong demand in waterfront and central districts. Villas continued to outperform, climbing 3.6 percent during the quarter and ending nearly 12 percent higher than Q3 2024 levels.
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