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Demand for real estate in Dubai continues into 2025. The development of luxury projects and major infrastructure ventures are further shaping property values and investment opportunities. According to the ValuStrat Price Index (VPI) report, almost all market segments recorded significant annual and quarterly growth, further confirming the stability and potential of this dynamic market. In the following text, we bring you the most important data from the VPI report for the first quarter of 2025 — from the rise in apartment and villa prices, to rent increases, and the neighborhoods experiencing the highest value growth.

The VPI report confirms the positive trend in the real estate market

In the first quarter of 2025, the VPI index increased by 5% quarter-on-quarter and 25.9% year-on-year, reaching 210.8 points. Villas stood out in particular, with their values averaging 59.9% above previous market peaks, while the luxury real estate segment is reaching record levels. Although apartment prices are still, on average, slightly below levels from a decade ago, certain locations such as Palm Jumeirah, The Greens, and JBR have surpassed their historical highs. This growth trend confirms that Dubai’s real estate market remains one of the most advanced in the world.
Currently, 141,404 apartments and 29,649 villas/townhouses are under construction, with completion planned by 2029. Of these projects, 12% are located in JVC, 7% in Business Bay, and 5% in Jumeirah Lake Towers.
The VPI for residential rentals in Dubai rose by 1.2% quarter-on-quarter and 7.9% year-on-year, reaching 198.3 points. Villa rental rates remained stable in the first quarter, with an annual increase of 5.1%, while apartment rental rates grew by 1.6% quarter-on-quarter and 10% year-on-year. According to this report, it’s estimated that around 90% of residential units in Dubai are currently occupied.

Population growth is driving demand for real estate in Dubai

According to ValuStrat, by the end of March 2025, Dubai's population had grown to 3.92 million, with 89,695 new residents added in the first three months of the year alone, averaging around 1,000 people per day. This is not surprising given that Dubai is recognized as a leading business and tourist destination, as well as a city offering attractive and appealing conditions for living and working. Additionally, there has been an increase in demand for commercial spaces in Dubai, with capital values jumping 29.1% and rental rates rising 20.2% year-on-year. Stable growth has also been recorded in the hospitality and industrial sectors, following the city’s economic momentum.

You can read the full report at the following link: https://cdn.shopify.com/s/files/1/0572/9406/1661/files/ValuStrat_Dubai_Real_Estate_Review_Q1_2025.pdf?v=1745999057.  For more information about the real estate markets in Montenegro and Dubai, contact our agency and be sure to check out our blog about the best locations for properties in Dubai!