Dubai’s residential real estate market began 2026 on a strong note, with higher transaction volumes and renewed buyer confidence shaping market activity in January. Momentum carried over from late 2025, driven largely by consistent demand for mid-range homes and continued interest from property investors.
Residential property sales reached a total value of AED 55.2 billion during the month, completed across 15,764 transactions. Compared to December, sales value increased by 18.7%, while transaction volume grew by 8.9%. Pricing conditions remained largely stable, with the average sale price recorded at AED 1,924 per square foot, reflecting only a slight month-on-month movement of 0.25%.
Off-plan properties continued to dominate sales activity, accounting for approximately 67% of all transactions. Apartments represented the majority of deals, with one-bedroom units emerging as the most transacted property type. This trend highlights ongoing demand from both end-users seeking affordability and investors targeting rental yields and capital appreciation.
Buyer engagement strengthened further during January, supported by rising lead volumes and sustained investor participation. Investors made up more than half of active buyers, while end-users continued to play a significant role, indicating a balanced and healthy demand profile across the market.
Overall market performance suggests steady absorption rather than speculative surges. Transaction growth combined with stable pricing reflects a market environment where buyers are acting with confidence and long-term intent rather than short-term speculation.
Rental Market Performance
Leasing activity also remained robust at the start of the year, with 48,966 rental transactions recorded in January. Contract patterns stayed consistent, with renewals accounting for 64% of agreements and new leases making up the remaining 36%. This balance reflects strong tenant retention alongside continued population growth.
Rental price increases were selective rather than widespread. In the villa segment, The Lakes recorded the highest month-on-month rental growth at 3%, with average annual rents reaching AED 365,000. Within the apartment market, Al Khail Heights led performance, also posting 3% growth and average rents of AED 70,000.
Demand for larger, well-located homes remained particularly strong, especially within established residential communities. Villas continued to achieve rental rates above broader market averages, underlining the preference for quality living spaces and long-term tenancy stability.
Market Outlook
Dubai’s residential property market is entering 2026 with solid fundamentals. Rising transaction volumes, steady pricing, strong leasing activity, and balanced buyer participation all point to a market supported by real demand. These trends reinforce Dubai’s position as a resilient and attractive destination for both property ownership and long-term rental investment.
Source: https://www.constructionweekonline.com/analysis/dubai-january-property-sales
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