Dubai's villa prices are exploding amid 5-year property boom
Global property consultancy Knight Frank said Q2 2025 marked a 'historic high' in both transaction volumes and values. The April-to-June period saw over 51,000 home sales — 'an all-time quarterly record.'
Faisal Durrani, Partner – head of research, MENA, said a segment to watch is the villa market. 'Just 20 per cent of the planned housing supply through to the end of 2029 will fall in the villa category, and with demand remaining centred on stand-alone family homes, the delta between villa and apartment price performance may well continue to widen.'
When the Covid-19 pandemic hit, buyers focused on securing larger homes, with more space for a home office, a home gym, and/or outdoor space. 'More importantly for Dubai, there has been unrelenting demand from international HNWIs looking to secure the city's most expensive homes, which tend to be stand-alone, beachfront properties,' Durrani told Khaleej Times.
Villas outperformed the broader market, with values climbing to Dh2,172 per square foot — a 4 per cent increase over the quarter. Villas are likely to remain in short supply over the medium term, and the price performance of this segment is expected to continue outperforming apartments.
'In fact, villa prices are now 49.3 per cent above 2014 peak levels, while apartment prices are up by 17.5 per cent over the same period.'
Top areas for villas
Villa price growth has been strong across both the luxury and affordable ends of the market.
'In Q2 2025, the highest quarterly growth was recorded in Victory Heights, Al Barari, Jumeirah Park, and Dubai Hills Estate, with average price increases ranging between 8-10 per cent. Al Barari and Dubai Hills, now firmly established as prime villa markets, continue to see strong demand driven by their lifestyle offerings and limited supply,' said Durrani.
Annual figures show that the top performers include the more accessible areas of Green Community West, Al Furjan, and Emaar South, along with the affluent communities of The Meadows and Arabian Ranches.
Who are the buyers?
Will McKintosh, Regional Partner – Head of Residential, MENA, said the market is increasingly being shaped by genuine buyers rather than speculators, with resale activity within 12 months of purchase now at just 4-5 per cent, compared to 25 per cent in 2008.
Durrani explained there is far less speculative market activity today compared to the two previous cycles, which were underpinned by 'buy-to-flip' activity. 'A metric we use to gauge market speculation is the proportion of homes resold within 12 months of acquisition. During 2008/09, this figure stood at 25-30 per cent, compared to nearer 4 per cent today, highlighting that there are more genuine end users in the market, in addition to long-term 'buy-to-let' or 'buy-to-hold' investors. Given the changing dynamic of buyers — many of whom are families — demand for villas remains strong.'
Five years of growth in prices
The total value of residential sales in H1 reached Dh268 billion, a 41 per cent increase compared to the same period last year. Knight Frank predicts that 2025 will surpass the Dh367 billion achieved in 2024.
Citywide residential prices rose by 3.4 per cent in Q2 2025, reaching an average of Dh1,809 per square foot. This places current values 21.6 per cent above the previous market peak recorded in 2014.
'The sustained growth in prices — now approaching five consecutive years since the current cycle began in November 2020 — is a clear sign of a more stable and predictable market environment,' said Durrani. 'Knight Frank's forecasts for 2025 remain unchanged, with 8 per cent growth expected in the mainstream market and 5 per cent in the prime segment.'
Off-plan sales accounted for nearly 70 per cent of all transactions in Q2. 'Prime residential areas such as Palm Jumeirah, Emirates Hills, Jumeirah Bay Island, and Dubai Hills Estate remain the most sought-after locations, particularly among international high-net-worth individuals.'
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