Property Rents in Dubai: July 2025 Market Analysis

Dubai's rental market in July 2025 presents a compelling narrative of stabilization and strategic positioning after several years of dramatic growth.

As we dive deep into the July performance data, the market reveals distinct patterns that offer valuable insights for property investors, landlords, tenants, and all stakeholders in this dynamic real estate ecosystem.

1. Overall market trends for property rents in Dubai

Apartments: Segment-Specific Insights

Overall apartment rents averaged 82,000 AED for new contracts, representing a 6.5% year-over-year increase from July 2024's 77,000 AED average.

This growth rate in property rents in Dubai, while positive, indicates a significant moderation from the double-digit increases witnessed in previous years, suggesting the market is entering a more sustainable phase.

2. Breakdown of property rents values by types, overall

Apartments 6.5% increase YoY

Villas and Townhouses 5.7% increase YoY

Commercial properties 200% increase YoY

3. Apartment rental highlights by area and unit-type

Beach main areas:

Dubai Marina and Plam Jumeirah

Palm Jumeirah continues to command premium pricing across all unit categories, reinforcing its status as Dubai's most exclusive residential destination. Studio apartments in the area reached 98,500 AED in July 2025, marking a notable 9.4% increase from the previous year. One-bedroom units averaged 145,000 AED, while two-bedroom apartments maintained their luxury positioning at 220,000 AED

Dubai Marina exhibited stability with minimal fluctuations across unit types. Studios recorded a marginal 1.6% increase to 65,000 AED, while one-bedroom apartments grew 3.3% to 93,000 AED. Interestingly, two-bedroom units experienced a 3.3% decline to 145,000 AED, suggesting some market softening in the family segment within this waterfront community.

City main areas:

Downtown Dubai and Business Bay

Downtown Dubai showcased mixed performance patterns. While studios experienced a slight decline of 1.3% to 75,000 AED, one-bedroom units saw reduced demand with rents falling 2.5% to 117,000 AED. However, two-bedroom apartments demonstrated resilience with a modest 1.4% increase to 182,500 AED, likely driven by family-oriented demand

Business Bay remained largely flat, with studios and one-bedroom units maintaining their July 2024 levels at AED 65,000 and AED 90,000 respectively. Two-bedroom apartments saw a 3.6% decrease to AED 135,000, indicating increased supply or reduced demand in this business-centric district.

4. Market Dynamics and Underlying Factors

The July 2025 rental performance reflects several key market dynamics. According to industry reports, Dubai recorded over 20,300 real estate transactions valued at 65 Bil during the month, marking a 24.9% year-on-year growth in volume. This unprecedented activity demonstrates continued confidence in Dubai's property market.

Supply-Side Impact

The market is experiencing the effects of substantial new supply, with over 72,000 new residential units expected to be delivered throughout 2025. This influx is already moderating rent growth, particularly in areas with significant new completions such as Jumeirah Village Circle and emerging communities.

Latest delivered projects in June were: THE HAVEN by Meraki Developers with 326 units

Pearl House I by Imtiaz Developer with 185 units

Year-to-Date the number of completed units is sitting at 20,432

Demand Patterns: Despite increased supply, demand remains robust, driven by Dubai's growing population, which crossed 3.75 million in June 2025 and is projected to reach 4 million by late 2026. The continuous influx of expatriates, remote workers, and returning residents maintains upward pressure on rental rates, especially in well-connected, established communities.

5. Market Outlook and Recommendations

For Property Investors: The July data suggests a market transitioning from rapid growth to sustainable expansion. Investors should focus on areas with strong infrastructure development and limited upcoming supply. Emerging communities with good connectivity offer the best risk-adjusted returns.

For Property Owners: Current rental levels provide strong cash flow opportunities, but owners should prepare for more competitive market conditions as new supply increases. Properties with unique amenities or prime locations within established communities will maintain pricing power.

For Tenants: July's moderated growth rates signal improved market conditions for renters. With substantial new supply entering the market, tenants have enhanced negotiating power and more options, particularly in emerging areas and newly completed developments.

For Market Stakeholders: The data indicates Dubai's rental market is maturing. The introduction of transparency measures and smart rental indices is creating a more balanced, data-driven market environment that benefits all participants

Conclusion

July 2025's rental performance demonstrates Dubai's property market entering a new phase characterized by measured growth, increased transparency, and enhanced choice for market participants. While premium areas like Palm Jumeirah maintain their luxury positioning, the overall market is showing signs of healthy stabilization after years of rapid expansion.

The combination of continued population growth, robust economic fundamentals, and substantial new supply creates a dynamic but increasingly balanced market. For stakeholders across the spectrum, July 2025 represents both the culmination of Dubai's remarkable rental market journey and the beginning of a more mature, sustainable growth trajectory.

For more detailed insights, stay tuned for our next monthly report to keep updated of the latest market developments in Dubai.

Source: DXB Interact