Dubai‘s residential property market has witnessed a shift as tenants move from renting to purchasing homes, with August property transactions reaching AED42.4 billion, according to a report by Engel & Völkers Middle East.
The real estate company reported a 22 per cent increase in secondary market sales during the first eight months of 2025 compared to the same period in 2024, indicating growing confidence among residents who view Dubai as a permanent base.
Families and young professionals are driving this transition, seeking property ownership to build equity, secure stability, and avoid rising rental costs.
Dubai secondary property sales surge 22% as renters choose to buy homes
“For many tenants, ownership is no longer aspirational; it’s becoming the preferred choice for long-term security and value creation,” Daniel Hadi, CEO of Engel & Völkers Middle East said.
Dubai recorded 17,879 property transactions worth AED42.4 billion in August, representing a 17 per cent increase in volume and 12 per cent rise in value year-on-year.
Off-plan sales dominated the market, rising 25 per cent year-on-year and accounting for nearly three-quarters of all transactions. The secondary market maintained momentum driven by end-user demand.
Sales of family homes led growth, with four-bedroom property sales climbing 70 per cent and five-bedroom or larger properties rising 63 per cent compared to the previous year.
Property prices continued upward movement, reaching AED1,664 per square foot in August according to Property Monitor, marking a 16.3 per cent year-on-year increase.
Villas experienced gains in lifestyle communities including Victory Heights (+37.0 per cent year-on-year), Dubai Hills Estate (+26.0 per cent year-on-year), and Arabian Ranches (+23.2 per cent year-on-year). Apartments recorded increases in areas including Jumeirah Village Triangle (+29.3 per cent year-on-year) and Jumeirah Village Circle (+17.0 per cent year-on-year).
Rental yields remained at 6.76 per cent overall in August, with apartments at 7.12 per cent and villas at 4.92 per cent. These yields exceeded prime markets including London (3-5 per cent), Singapore (3-4 per cent), and New York (5-7 per cent).
The yields are supported by Dubai’s growing population, new company formations, and limited supply of rental stock.
Leasing volumes declined 4 per cent year-to-date, with new contracts falling 14 per cent while renewals increased 2.6 per cent. The luxury segment saw villa leases fall by double digits as families chose purchasing over renting.
Demand spans UAE residents and international buyers from Europe, the Middle East, and Asia. Indian, British, German, Egyptian, and Chinese buyers remain active in off-plan purchases, while residents drive resale market growth.
Mortgages support transactions with loan-to-value ratios of 70-80 per cent and interest rates around 3.9 per cent. Cash transactions and developer-backed payment plans continue driving off-plan sales.
“Dubai’s market today is being fueled by a dual dynamic: strong global investment flows into off-plan projects and a clear shift among residents toward homeownership. August’s activity reflects both the city’s international appeal and the growing number of long-term residents putting down roots,” Hadi explained.
Engel & Völkers expects momentum to continue into the final quarter of 2025, with off-plan sales driven by developer activity, payment plans and international demand, while the resale market benefits from population growth, mortgages, and tenant-to-owner transitions.
“Dubai’s property market is no longer just about short-term investment cycles. It is increasingly about residents choosing to establish roots here — buying homes for security, lifestyle, and long-term value creation. This shift is set to define the next phase of the city’s real estate story,” Hadi concluded.
