UAE Property Market 2025: Growth, Yields, and Forecast for 2026

Nov 15, 2025

A composite view of the Dubai skyline, Abu Dhabi skyline, and Al Marjan Island in Ras Al Khaimah.

The UAE property market is demonstrating impressive and diversified growth in 2025, proving it is no longer a stage dominated solely by Dubai. While Dubai continues to lead in transaction volume, Abu Dhabi posted record-breaking 39% growth in transaction value, hitting AED 51.7 billion in the first half of 2025. Simultaneously, Ras Al Khaimah is emerging as the fastest-growing market, with a 118% surge in deal value in 2024, a trend accelerating in 2025 due to the Wynn Resort mega-project. This economic stability, combined with proactive government programs, is attracting different investor profiles to each emirate. In this complete analysis, we will examine the key drivers, compare the hotspots, and provide an expert forecast for 2026.

Content

State of the UAE Property Market – Diversified Trends 2025

Price Analysis

Price growth in the UAE is highly diversified depending on the emirate:

Dubai: Continues to lead the ultra-luxury segment (Palm Jumeirah, Jumeirah Bay Island). Mid-market apartments in high-demand areas (JVC, Arjan) also show stable growth but are facing significant new supply.
Abu Dhabi: Demonstrating more sustainable and stable growth. Villa prices have seen low- to mid-double-digit annual growth, with apartment prices up by high single to low double digits in H1 2025. Growth here is driven by strong end-user and HNW (high-net-worth) demand and a shortage of quality supply.
Ras Al Khaimah: Experiencing explosive growth. Average property prices saw a significant YoY jump in Q1 2025. Demand is primarily speculative, focusing on off-plan projects on Al Marjan Island in anticipation of the casino resort opening.

Demand Drivers

Beyond the universal appeal of the Golden Visa and 0% taxes, each emirate has specific drivers. Dubai is the global financial and lifestyle hub. Abu Dhabi attracts capital as the stable, oil-rich capital and a family-oriented destination. Ras Al Khaimah is transforming into a global tourism destination, with its population projected to grow from 400,000 to 650,000 by 2030, creating massive housing demand.

Rental Market and Yields

Yields vary significantly. While Dubai is stable (averaging 6-9%), Ras Al Khaimah offers attractive returns, with average gross yields around 5–6%, and select waterfront or branded projects on Al Marjan Island achieving up to about 8–9% in some cases. In Abu Dhabi, yields are slightly lower but exceptionally secure, due to constant demand from professionals in the government and energy sectors. Before committing, it’s critical to understand how to calculate your potential Return on Investment (ROI) to assess the true potential.

Investment Hotspots: Where to Invest in the UAE?

Investors must now choose an emirate based on their risk tolerance and goals.

Dubai (The Global Hub)

Why: The most liquid market, a global “brand,” and the widest variety of assets. While the luxury segment leads growth, some Dubai neighborhoods still offer excellent value.
Prices: The highest barrier to entry in established areas (Dubai Marina, Downtown).
Yields: Stable, with excellent short-term (Airbnb) and long-term rental opportunities.
Risk/Advantage: The advantage is liquidity. The primary risk is oversupply in certain segments.

Abu Dhabi (The Stable Capital)

Why: The political and economic center, with a focus on sustainability and quality. The market is less speculative and more stable.
Prices: High, but underpinned by real demand. Saadiyat Island (AED 9.1B in transactions) and Yas Island (AED 5.86B) are the most sought-after locations.
Yields: Strong and secure, driven by a supply shortage of villas and quality apartments.
Risk/Advantage: Lower volatility. The main challenge is a supply shortage, which is a positive for current investors.

Ras Al Khaimah (The Rising Star)

Why: The “Wynn Effect.” The anticipated 2027 opening of the UAE’s first regulated casino resort, originally announced as a $3.9B project (with recent estimates higher), has ignited an investment frenzy.
Prices: Still significantly lower than Dubai, but with the highest percentage growth. 85% of deals are off-plan.
Yields: High potential (up to 8-9% for properties on Al Marjan Island).
Risk/Advantage: Highest potential for capital appreciation. The risk is that the market is highly speculative and tied to the success of a single mega-project.

Key Factors for Foreign Investors

The UAE Golden Visa Program

This is a universal tool across all emirates.

Investment Threshold: A minimum property investment of AED 2 million (approx. €505,000 / $545,000).
Benefits: Grants a 10-year residency for the investor and their family.
Market Impact: This program directly fuels demand, especially in Abu Dhabi and Dubai, as investors seek assets above this threshold. For a full breakdown, see our complete guide to the UAE residency visa through property.

Taxes and Purchase Costs

Tax efficiency is a primary advantage of the entire UAE property market.

Transfer Fee: Varies (e.g., 4% in Dubai).
Annual Property Tax: 0% (zero).
Capital Gains Tax: 0% (zero).
Rental Income Tax: 0% (zero).
Note: While there is no annual property, capital gains, or personal income tax on rental income in the UAE, investors may still face housing/municipal fees, corporate tax where applicable, and taxes in their home country.

Risks and Forecast for 2026

The forecast for 2026 is not uniform across the country.

Oversupply Risk (Dubai-Specific)

This is the classic Dubai risk. Analysts predict that between 2025 and 2027, over 120,000 – 150,000 new residential units will enter the market. This massive supply will almost certainly put downward pressure and a price correction on rents and prices in specific segments of Dubai.

Undersupply Risk (Abu Dhabi & Ras Al Khaimah)

These two markets face the opposite problem. In Abu Dhabi, too few quality new homes are being delivered, keeping prices high. In Ras Al Khaimah, a massive demographic boom is expected (needing 45,000 new homes by 2030), which current off-plan projects will struggle to meet. For investors, this is a positive risk, as it supports capital and rental growth.

Expert Forecast for 2026

We expect a market divergence:

Dubai: Analysts expect a single- to low double-digit price correction (up to around 10–15%) in oversupplied apartment segments, while prime and luxury stock should remain more resilient.
Abu Dhabi: Continued stable growth (5-8%), driven by a fundamental supply shortage and strong end-user demand.
Ras Al Khaimah: Continued strong growth, though moderating, as the Wynn Resort opening (2027) approaches. The market remains speculative but with a massive upside.

Conclusion

The UAE property market in 2025 offers something for everyone: liquidity and luxury in Dubai, stability and quality in Abu Dhabi, and explosive growth in Ras Al Khaimah. The days of easy wins are giving way to a more mature strategy focused on rental yields and quality capital appreciation. Choosing the right emirate is now just as important as choosing the right property.

Before making a decision, it is crucial to calculate your potential return. Learn how in our complete guide to calculating Return on Investment (ROI).