The Dubai Real Estate & Short Let Market Report Q4 2025

A market under pressure

Dubai’s property market is still growing, but Q4 2025 shows clear signs that pressure is building. AirDXB’s Dubai Real Estate & Short Let Market Report Q4 2025 highlights a market that is slowing, becoming more selective, and increasingly split between segments that are holding up and those starting to soften. This quarter marks a shift in tone for Real Estate in Dubai.

Growth is slowing

Transaction values reached AED 141bn in Q4 2025, up 20.4% year on year. Volumes rose 13.3%, a sharp slowdown compared to the same period last year. The market is still expanding, but the pace has eased quickly. Momentum has clearly cooled. Download the full report below to see the double digit reduction in YOY growth 2023-2024 compared to 2024-2025.

Source: Property Monitor

Buyers are trading size for affordability

Average price per square foot rose to AED 1,927, up 11.8% year on year. However, over 51% of transactions now sit below AED 1.5m. Studios and one bedroom units account for 62% of all sales, up from last year. Buyers are adjusting rather than stretching. Smaller units are doing the heavy lifting.

Source: Property Monitor

Off plan activity is carrying the market

Off plan sales continue to dominate. Transaction volumes for new launches rose over 22% year on year, while resale volumes declined. Transaction values show an even wider gap, with off plan values up nearly 29%. This leaves the market increasingly dependent on future delivery rather than completed stock showing a heavily speculative market that is investor driven.

Source: Property Monitor

Long term rentals continue to weaken

The long term rental market softened further in Q4 2025. Total contracts fell 5.72% year on year, while renewals dropped 6.61%, with another decline quarter on quarter. Tenants are more flexible and have more choice. Landlords are facing increased competition, particularly in areas with rising supply. Long term leasing is steadily losing traction.

For investors, this is a point to pause and reassess. Rental income can no longer be taken for granted, and assumptions based on past performance may no longer hold. This is a market that rewards informed decisions, clear planning and active oversight. Understanding your investment objective, whether income, capital preservation or timing an exit, is key. Staying in control of your asset and adapting your strategy is becoming essential.

Source: Property Monitor

Short lets remain more resilient

Despite wider pressure, Short Let Dubai performance continues to outperform long term rentals in many areas. Locations such as Dubai Marina, Jumeirah Village Circle and Dubai Creek Harbour still deliver stronger annual income when managed correctly.

That said, competition is rising. As more properties enter the short let market, performance is no longer passive. Pricing strategy, positioning and day to day management now play a decisive role in who secures bookings and who does not.

More than ever, professionally managed homes are setting themselves apart. Those that are priced correctly, marketed properly and actively managed are the ones staying ahead of the curve and capturing demand, while others are increasingly left behind.

Sources: AirDNA, Property Finder, Property Monitor

What this means for owners

Q4 2025 was not a turning point, but it was a warning. Growth is slowing. Long term rentals are under pressure. Off plan supply is shaping the market. For landlords and investors, strategy now matters more than sentiment. Professional Property Management Dubai is becoming essential, not optional.