Shifting investor, tenant preferences fuel Dubai realty boom
Dubai's real estate market is experiencing a significant surge, driven by shifting preferences among investors and tenants, according to analysts at Property Finder, a leading property portal.
In February, the market recorded a remarkable 35 per cent annual increase in transactions, totalling 16,099 deals, along with a staggering 55 per cent rise in total market value, reaching Dh51.1 billion.
When it comes to apartments, a substantial 71 per cent of buyers are gravitating toward smaller units. Specifically, 34 per cent are seeking one-bedroom apartments, while 37 per cent are focused on two-bedroom configurations. The demand for studios remains stable at 13 per cent. Notably, prime locations such as Dubai Marina, Downtown Dubai, and Palm Jumeirah are dominating the searches, as investors prioritise luxury and connectivity.
On the villa front, the demand for larger spaces is evident. A striking 86 per cent of villa seekers are interested in three-bedroom (39 per cent) or four-bedroom-plus properties (47 per cent), reflecting a growing preference for family-oriented living. Areas like Dubai Hills Estate, Damac Hills 2, and Al Furjan are topping the lists, showcasing a desire for community amenities and affordability.
The tenant side of the market is also evolving. A significant shift has been observed among renters, with 64 per cent now opting for furnished apartments, a notable increase from 45 per cent in 2024. This trend is largely driven by expatriates seeking convenience. Among renters, 56 per cent are focusing on studios (20 per cent) or one-bedroom apartments (36 per cent), indicating budget-consciousness.
In terms of rental hotspots, Jumeirah Village Circle (JVC), Deira, and Business Bay are attracting the most interest. For villa rentals, while unfurnished options still dominate (58 per cent), the demand for furnished villas has risen sharply to 42 per cent, compared to 36 per cent in the previous year. Space remains a priority, with 80 per cent of renters seeking three-bedroom (41 per cent) or larger villas, particularly in sought-after areas like Jumeirah, Dubai Hills Estate, and Al Furjan.
The report also highlights a booming off-plan market, with transaction values soaring 57 per cent year-on-year to Dh20.5 billion. Key areas driving this growth include Wadi Al Safa 5 and Al Yufrah 1, with significant sales recorded at Dh2.2 billion and Dh1.4 billion, respectively. Meanwhile, the ready market remains resilient, with existing property transactions rising by 27 per cent to 6,997, led by high-profile properties such as the Burj Khalifa and Al Yelayiss 1.
Cherif Sleiman, chief revenue officer at Property Finder, said Dubai's market is maturing, with investor and tenant preferences shaping inventory strategies. 'The spike in furnished apartments and off-plan investments reflects Dubai's appeal to global talent and entrepreneurs seeking turnkey solutions. Meanwhile, villa demand highlights the city's growing reputation as a family destination. Regulatory initiatives, like streamlined business setups, are amplifying this momentum, making Dubai a magnet for long-term capital.'
According to realty experts, this evolving market landscape carries significant implications. Investors are balancing high-yield opportunities in studio and one-bedroom apartments with luxury villa projects in emerging suburbs.
Tenants, on the other hand, increasingly value flexibility, with furnished units minimising relocation costs for transient professionals.
'Developers and landlords must adapt to the polarized demand, focusing on compact, ready-to-move-in apartments versus spacious, customizable villas,' the report said.
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