Average price per square metre
In the absence of precise HPI data for the United Arab Emirates, the closest proxy is the trend in the average price per square metre. Broadly the same trend is visible across all emirates. After a decline that lasted until 2020, property prices resumed growth nationwide. The amplitude of the swings, however, is markedly higher in Dubai and Abu Dhabi.
Number of transactions
Dubai saw the sharpest fall in transaction volumes during the Covid restrictions because of its high dependence on foreign demand. By 2024, however, the number of transactions had returned to 2016 levels.
It is worth noting that foreign nationals account for roughly 88.5% of the emirate's total population, and this share continues to rise every year.
Areas open to foreign ownership
Share of total construction volume
Dubai remains the clear leader by scale of construction, accounting for 57.4% of the country's total construction volume.
Foreign demand
The most active buyers of UAE property are nationals of India, the United Kingdom, China, Russia, Saudi Arabia, Pakistan, Iran, the United States and Germany.
Rental yield
Dubai continues to lead on rental yield.
Price and yield
Dubai retains its lead when price per square metre is set against rental yield.
The current investment environment in the UAE reflects cautious optimism. On one hand, construction activity is accelerating. On the other, demand in Dubai's secondary market remains uncertain because of the very high pace of new construction.
Dubai's new development programme is built around five key pillars:
- Growing the population from 3.6 million to 6 million
- Expanding airport capacity to 260 million passengers a year — twice that of the world's leading transport hubs
- A fourfold increase in green space and the conversion of a number of districts into green urban areas
- A large-scale expansion of the transport network, which will stimulate demand in locations that are underdeveloped today
- The creation of a climate-controlled pedestrian and cycling route several kilometres long to improve urban quality of life
- 01
Dubai has repeatedly set ambitious targets and delivered on them. The city takes development planning seriously, and the stated priorities clearly reflect residents' needs. Over the past 50 years most strategic objectives have been met without major systemic failures.
- 02
Changes to the transport network will materially affect pricing in many locations, particularly with the development of the Blue Line.
- 03
Some older districts will lose relevance as new developments come through, while others will appreciate significantly. The direction of capital migration from ageing locations to emerging ones is already becoming clear.
- 04
The range of projects is very wide, so focusing on assets with predictable returns is critical. Such opportunities exist, but the number of projects unsuitable for investment purposes is far higher — and they are often marketed more aggressively. Many projects are already overpriced at launch and offer virtually no upside during the construction phase.
- 05
A number of locations currently offer strong long-term entry opportunities (5–7 years) with the potential for a multiple increase in price. The choice of the specific property is critical, however — even a difference of 100 metres can materially affect the potential for capital growth.
- 06
Many of the most valuable projects remain off the radar because of limited marketing, yet these are the ones most likely to be in demand on the secondary market in 5–6 years.
- 07
Redevelopment and flipping strategies are regaining potential as pressure on older districts increases.
- 08
The commercial property market recorded historically low vacancy in 2025, creating scope for rental yields to rise. If the trend holds, yields could reach 9–11% per annum in US dollars, significantly above residential. New commercial supply is under construction, but the potential for a temporary shortage is already evident.
- 09
In 2026, migration flows from Europe are expected to increase — above all from the United Kingdom and Germany.
Given the wide range of offerings and aggressive marketing activity, exercising caution in project selection is critical. In such an environment, buying illiquid assets becomes a substantial risk.
It is important to remember that the Dubai market has historically been volatile. Rapid growth in 2005–2008 was followed by a sharp correction in 2009. That gave way to a recovery in 2010–2014 and a further correction in 2014–2020. The current growth cycle began in 2021 and is still under way.
Many research houses forecast a correction because of the large volume of new supply expected in 2026. In practice, market performance will depend directly on the execution of the growth strategy. Dubai has a good chance of avoiding a correction, since conventional forecasts are built on historical data and often fail to account for population growth driven by continuing inward migration.
Whatever the scenario, therefore, the following recommendations are worth bearing in mind:
- Focus on higher-priced locations, which are less likely to suffer in corrections even when the mass-market segment declines. Waterfront districts represent zones of particular value, although they are not homogeneous.
- Year by year, the quality of a project's internal infrastructure will matter more and more, particularly in the premium segment.
- There are locations that should only be considered for entry once 2026 data provides clarity on the market's direction. Many districts — above all in the mass-market segment — should already be avoided if the objective is investment income.
- For residential rental income, properties completed 5–7 years ago, fully furnished and equipped, remain more optimal than new builds.
- Commercial property remains relevant as a more predictable strategy — provided the lease structure and location are right.
- Moderate growth in transaction volumes
- Stable end-user segment
- Investment focus on residential and mixed-use assets
✔ Demand concentrated in the suburbs and around new infrastructure hubs
✔ Rental yield remains stable with no sharp swings
✔ Premium projects continue to attract HNWI from Asia and the GCC
- Structural corporate relocation
- Government and infrastructure projects
- Inflow of professionals in oil and gas, finance and technology
Conclusion: more conservative dynamics than Dubai, with lower volatility.
- Steady increase in market share
- Expansion of the mid-market segment
- More affordable housing than in Dubai
- Growing domestic and regional demand
✔ Higher growth potential for price per m² than in Fujairah and Ras Al Khaimah
✔ Rental demand supported by population growth and migration from other emirates
- Proximity to Dubai and lower entry prices
- Improving infrastructure
- Growing middle-class demand
Conclusion: Sharjah is strengthening its position as an alternative to Dubai for investors and families, while remaining substantially smaller in scale.
- Faster growth in transaction share than in the other smaller emirates
- Expansion of a niche market
- Focus on resort projects and branded residences
✔ The highest percentage growth in transactions among the smaller emirates (~8–12%)
✔ Strong appeal for leisure and dual-use properties
- Development of tourism infrastructure
- Branded residences and resort projects
- Relatively low entry thresholds
Conclusion: growth is driven by tourism and supported by distinctive formats, but carries a higher risk of correction depending on demand.
- The smallest share of construction volume
- A stable but narrow market
- Slower transaction dynamics
- Infrastructure and logistics projects
- Limited housing supply
- A growing but relatively small tenant base
Conclusion: a “quiet” market, better suited to long-term holding than to active speculative strategies.
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