Tight Supply Boosts UAE Real Estate Growth in Q3 as Demand Strengthens Across Key Sectors

Thursday, 18 December 2025

The UAE’s real estate sector experienced strong growth in Q3 2025, supported by tight supply conditions, rising off-plan activity, and increasing demand across residential, hospitality and industrial markets, according to JLL. Strategic diversification and value-focused development continue to elevate long-term sector performance.

Key Highlights:

Overall Market Performance

Tight supply and rising demand pushed prices and rents upward across all segments.
Diversification, strategic adaptability, and value optimisation strengthened long-term market resilience.
Strong macroeconomic fundamentals and population growth continued to support sector-wide expansion.

Residential Sector – Off-Plan Drives Momentum

UAE residential market recorded record transactions, led by off-plan sales.
Dubai achieved AED 139.7 billion in sales value during Q3.
Abu Dhabi off-plan transactions grew 113%, with overall growth at 76.2%.
Dubai saw 16.5% growth, with off-plan comprising 75.4% of all Q3 sales.
Villa prices rose around 15% in both Dubai and Abu Dhabi.
Apartment prices increased 7.8% in Abu Dhabi and 12.6% in Dubai.
Upcoming supply: 12,000 units in Q4 2025, 47,200 units in 2026, 72,500 units in 2027—mostly apartments.

Rental Market Trends

Dubai rentals showed steady performance with stable growth trends.
Abu Dhabi rents increased across all property types:
- 15.6% for villas
- 14.8% for apartments

Hospitality Sector – Strategic Investment Shift

Investors pivoted towards existing hospitality assets due to rising land costs and limited plots.
Dubai welcomed 13.95 million visitors (Jan–Sept), up 5% YoY.
Tourism strengthened by visitors from GCC, Western Europe, and South Asia.
Secondary markets like Australasia and Americas saw double-digit growth.
2025 forecast: 19.44 million international overnight visitors (+5.2%).
Limited new land supply supports strong occupancy and long-term pricing power.

Industrial & Logistics – Rapid Evolution

Rising demand for specialised and flexible warehouse solutions.
Growth of micro-fulfillment centres and temperature-controlled facilities.
Smart logistics push from RTA and DP World enhances value through operational efficiency.
Warehouse rents increased:
- 21.3% in Abu Dhabi
- 17.8% in Dubai
High demand boosting rents in:
- Dubai Industrial City (24.3%)
- Dubai South (21.3%)
- Kezad – Al Mamoura in Abu Dhabi (24.7%)
Free Zone demand exceeds supply, encouraging new pre-leased facility developments.