Dubai: Rent increases slow down as more inventory comes online
New property inventory availability has reduced rent growth in Dubai which provides tenants with more choices according to real estate executives.
Online rental listings have grown in number which supports the trend toward stable rents in several locations throughout 2025. Tenants have expanded choices and demonstrate heightened price sensitivity in these sectors while landlords who offer competitive pricing secure tenants faster according to Rupert Simmonds, director of leasing at Betterhomes.
Simmonds explains that the recent rent increases should be seen as normal market fluctuations indicating healthy cycles. Dubai's first monthly rent decrease since before 2023 emerged in January 2025 and marked the start of a shift toward market equilibrium.
Average prices showed a 0.57 percent decline to Dh1,484 per square foot in January 2025 marking the first fall since summer 2022 according to Property Monitor data. The market cooling follows four years of exceptional growth where prices rose more than 30 per cent in 2024.
The real estate brokerage Asteco reported that 2024 saw fewer new supply deliveries than expected but forecasts for 2025 show a major rise in available inventory.
If the projected supply enters the market in large numbers rental growth will moderate or reverse in particular communities or projects.
The Northern Emirates expect to see migration growth in 2025 because of affordability factors which accelerated during the latter part of 2024. This year Asteco expects delivery of 63,900 apartments and villas which surpasses the 33,625 units delivered in 2024.
The real estate consultancy Cavendish Maxwell predicted that 243,000 new units will be delivered by 2027 with 80 per cent of them being apartments. The price and rental market in Dubai will experience additional relief as more housing arrives.
Between now and 2027 most new units will be built in Jumeirah Village Circle which will feature almost 25,000 deliveries followed by Business Bay (16,000), Azizi Venice (13,500), Damac Lagoons (11,100), and Arjan (9,000).
The strongest rental growth was reported at Al Khail Heights apartments which saw an increase to Dh66,900 with a 6.6 per cent rise according to Betterhomes data. Townhouses in Palm Jumeirah registered a 6.5 per cent increase reaching Dh127,300.
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