Dubai Property Market Outlook: Anticipated Slowdown in Unit Deliveries
The Dubai property market is set to undergo a notable slowdown in residential unit handovers in 2025 and 2026. According to a recent report from Morgan’s International Realty, the anticipated supply of residential units is expected to fall short of expectations. This analysis suggests that only 62% of the anticipated units for 2025 will be delivered, translating to just 22,896 out of 37,171 projected units. For 2026, the situation appears even more subdued, with only 48%, or 34,740 units from the estimated 71,613, expected to reach the market.
Recent Trends in Unit Deliveries
These figures are reflective of a persistent trend in the region’s real estate sector. From 2022 to 2024, a mere 97,000 out of 174,000 projected units were completed, marking a completion rate of 56%. Factors contributing to this lagging performance include challenges in securing reliable contractors, delays in project sales timelines, funding issues from banks, and complications regarding buyer payments. Renowned firms like Emaar Development have maintained strong records of timely project completions, yet the overall landscape remains challenging.
Surging Demand Amidst Supply Issues
Despite these challenges, Dubai’s real estate market has witnessed a surge in demand, pushing both prices and rents to unprecedented heights. In the past year alone, the city experienced a staggering 226,000 transactions, generating a combined value of Dh761 billion. This represents a 36% increase in transaction volume and a 20% rise in overall value year-on-year. However, the influx of new developers has not sufficiently addressed the ongoing shortage of qualified contractors, further complicating the supply landscape.
Key Delivery Areas for 2025-26
The Morgan’s International Realty report highlights key delivery areas for residential units in the upcoming years. In 2025, the primary locations for new unit handovers will be:
- Studio City
- Sobha Hartland
- Jumeirah Village Circle (JVC)
- Jumeirah Lake Towers (JLT)
- Al Furjan
For 2026, the focus of deliveries will shift toward:
- Jumeirah Village Circle (JVC)
- Azizi Venice
- Damac Lagoons
- Business Bay
- Arjan
Significant Spike in 2027 Supply
Looking ahead to 2027, projections indicate a significant surge in residential deliveries, with around 70,537 units expected. This figure is nearly double the average annual supply of 35,531 units over the previous five years. Notably, the majority of this new supply will concentrate in key areas such as JVC, Business Bay, Azizi Venice, Dubai Hills Estate, and Creek Harbour.
Implications of Concentrated Supply
Jumeirah Village Circle will remain the most active development zone across these years, with 16,852 units scheduled for delivery between 2025 and 2027. This concentrated supply may lead to downward pressure on prices, raising concerns about potential oversupply. Business Bay follows closely, with 10,127 units expected, while Azizi Venice will see 7,860 units completed during the same timeframe. The elevated supply in these burgeoning areas could have lasting impacts on pricing and absorption dynamics in the subsequent years.
Outlook Summary
In summary, while the Dubai property market has seen significant demand and transactional growth, the projected slowdown in new unit deliveries over the next couple of years raises essential questions about the ongoing supply chain challenges and market dynamics. Real estate stakeholders will need to navigate these complexities carefully, especially as the landscape shifts dramatically in 2027 with the anticipated influx of new residential units.
