May Update: April Market Recap & What’s Next | Dubai Short-Let & Real Estate Insights
Dubai’s property market is shifting long-term rentals are down 44%, sales volume has dropped 26% and off-plan dominates. Investors face price corrections, increased competition and evolving strategies
Long-Term Rentals in Dubai
Long-term rental tenancy agreements have dropped by 44% over the past 16 months according to Property Monitor, including a 23% decline from March to April 2025 alone signaling market instability and weakening demand for long-term rentals. Despite brief recoveries (e.g., October 2024), the downward trend has persisted as seen in the below graph, setting the stage for inevitable price corrections in long-term rentals.
Declining long-term tenancy demand → lower rental rates → reduced ROI.
With this decline already unfolding, the key question remains: What happens when 300,000 new units enter the market? The impact will be profound rental prices will fall, competition among landlords will increase, and investor strategies will shift.
Sales Volume in Dubai
Property Monitor also reports a 26% decline in total sales transaction volume from October 2024 to March 2025, indicating a sustained slowdown in market activity. In March 2025, transactions fell by 5.7% month-on-month, as seen in the below graph, bringing total sales to 15,223 further reinforcing the downward trend. This decline confirms that Dubai is entering a cooling period, leading to price corrections, increased seller competition and strategic shifts among developers including payment plans and incentives to stimulate demand and facilitate the sale of handover units.
Our Advice
Market corrections, adjustments and even collapses are inevitable but avoiding long-term contracts and maintaining chain free properties can help mitigate risks in an unpredictable economic landscape.
NEW: The Big Short Series. Navigating Dubai’s Property Market Episode 1
From long-term rentals to property sales and the growing influence of off-plan developments, Gregory Lewis teams up with Louis Bowers in AirDXB’s new series, 'The Big Short' together, they break down the data, facts and figures that no one else is talking about. With declining long-term rental demand, shrinking sales volume and an off-plan market dominating the landscape with 64% in March 2025, what does this mean for investors?
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