Dubai Real Estate Tops Global Rankings in 2025 as Prices Surge, Surpassing London, Paris, and Madrid: Report
February 21, 2025
Dubai’s real estate sector is poised to dominate global real estate markets in 2025, with capital values projected to rise by up to 9.9%, according to a report by Savills. This growth follows an impressive performance in 2024, where prime residential capital values increased by 6.8%, and rental values soared by 23.5%.
The city’s real estate market continues to thrive, driven by strong demand in sought-after communities and a supply shortage in premium areas. Andrew Cummings, Head of Residential Agency at Savills Middle East, highlighted Dubai’s appeal to global investors, citing its robust rental market and consistent capital appreciation. He added that 2025 is expected to bring further momentum, with high-value transactions and ultra-luxury developments reshaping the city’s property landscape.
Key Drivers of Growth in Dubai Real Estate
Dubai’s real estate boom is fueled by a growing population and an influx of high-net-worth individuals (HNWIs) and family offices relocating to the UAE. The launch of ultra-luxury projects has redefined the concept of prime properties in Dubai, attracting affluent buyers and investors.
The rental market is also set to maintain its strong performance, with growth projections exceeding 10% in 2025. This stands in stark contrast to the global outlook, where Savills predicts average price growth of just 1.6% across 30 major cities, down from 2.2% in 2024.
Dubai vs. Global Markets
Dubai’s prime properties now command an average price of $930 per square foot (€9,200 per square meter), reflecting the city’s growing stature as a global real estate hub. Many international buyers are choosing to rent before purchasing, contributing to the significant rental value increases seen in 2024.
Kelcie Sellers, Associate Director at Savills World Research, noted that despite global economic challenges, prime residential markets have remained resilient. However, 2025 could bring changes as new governments implement policies affecting taxes, legislation, and international relations, potentially impacting property markets worldwide.
Future Outlook
As Dubai progresses into 2025, its real estate market is expected to continue its upward trajectory, outperforming major global markets such as London, Hong Kong, and New York. The city’s focus on branded residences, waterfront developments, and sustainable luxury homes is set to solidify its position as a premier destination for prime residential investment.
With sustained demand and innovative projects, Dubai’s real estate sector is not only leading the region but also setting new benchmarks on the global stage. Investors and buyers alike are drawn to the city’s dynamic market, making it a key player in the world of luxury real estate.
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