Dubai Property Market Rebounds as Sales Rise and Investors Return

The Dubai property market showed renewed momentum in July, with both residential transaction volumes and total sales values increasing as buyer sentiment improved. New data from Property Finder and Mortgage Finder indicates that investors and homebuyers are returning to the market, particularly in the secondary segment, while expectations of further price declines have begun to ease.

According to the latest figures, Dubai recorded 9,217 sale transactions in July, compared with 8,887 in June. This represents a monthly increase of 3.8 per cent. The total value of transactions also increased, rising 5.2 per cent from AED 33.2 billion in June to AED 34.9 billion in July.

The recovery was driven largely by the secondary market, suggesting that buyers are increasingly looking at completed and ready-to-move-in properties rather than focusing exclusively on new off-plan developments.

Cherif Sleiman, Chief Revenue Officer at Property Finder, described July as a market that had returned to growth, with transaction volumes and values increasing together and buyers demonstrating renewed purchasing intent. He also indicated that the momentum could continue through the second half of the year.

Secondary Market Leads the Recovery

One of the strongest signals emerging from the July data is the sharp increase in secondary-market activity.

Secondary-market transaction volumes rose by approximately 18 per cent, increasing from around 4,100 transactions in June to 4,800 in July. This significant rise indicates growing demand for ready properties and suggests that buyers are increasingly willing to commit to existing homes as concerns about further price corrections diminish.

The shift is particularly relevant for investors looking for properties that can generate rental income immediately. Ready homes can provide investors with quicker access to rental returns compared with properties that are still under construction.

The increase also points towards a more value-driven approach among Dubai property investors. Rather than waiting indefinitely for prices to decline, buyers appear to be reassessing opportunities in the mid-market and entering the market where they believe current pricing offers attractive value.

Commercial property activity also strengthened. Commercial transaction volumes increased by 24.8 per cent to 397 deals, with the segment recording a total transaction value of AED 5.8 billion.

Buyer Confidence Begins to Improve

The improvement in Dubai property market activity has been accompanied by a change in buyer expectations.

Property Finder data shows that the proportion of people planning to purchase a property within six months increased from 66 per cent to 68 per cent. This indicates that a larger share of prospective buyers is becoming prepared to move from consideration to actual purchasing activity.

At the same time, expectations of further price declines have moderated.

The proportion of respondents expecting prices to fall further declined from 56 per cent to 52 per cent. This represents a considerable change from the earlier peak of 73 per cent recorded at the beginning of the conflict.

Meanwhile, the share of respondents expecting prices to remain stable or increase rose from 44 per cent to 48 per cent.

This shift in expectations could be important for the next phase of the Dubai property market. When buyers believe that prices have largely stabilised, the incentive to delay purchases in anticipation of substantially lower prices becomes weaker.

Dubai Property Prices Show Signs of Stabilisation

The latest figures also point towards greater stability in advertised property prices.

Property Finder’s sale-listing price index remained at 2.5 per cent of the pre-conflict baseline for the second consecutive month. While this does not necessarily indicate a broad-based price surge, the continued stability suggests that the market may be moving away from the sharp price adjustments witnessed during periods of uncertainty.

Another important indicator is the narrowing gap between advertised and final transaction prices.

In July, the difference between listing prices and final transacted prices narrowed to between 5.5 per cent and 11 per cent. In May, the corresponding range was between 6 per cent and 12 per cent.

The narrowing spread suggests that negotiations between sellers and buyers are becoming more aligned. Sellers may be becoming more realistic about market conditions, while buyers appear increasingly willing to accept current valuations when they identify suitable properties.

This convergence could contribute to greater stability across the market in the coming months.

Apartments Become the Preferred Investment Segment

Apartments gained a larger share of Dubai’s residential sales during July, strengthening their position as a preferred investment category.

The share of apartment transactions increased from 59.5 per cent to 62 per cent of total residential sales. Studios and one-bedroom apartments were particularly important in driving this growth.

The preference for smaller apartments reflects their relative affordability, liquidity and potential rental yields. For investors, these properties can provide a lower entry point while maintaining access to Dubai’s large tenant population.

The trend also highlights the continuing importance of the mid-market segment. Investors appear to be targeting properties that combine manageable acquisition costs with the potential for rental income and resale liquidity.

Rather than being concentrated entirely among luxury buyers, the latest recovery therefore appears to have a significant investor component in more accessible segments of the Dubai property market.

Mortgage Activity Signals Returning Investor Confidence

Mortgage activity provides another indication that confidence is improving.

Mortgage transactions increased from 9 per cent of activity in June to 12.8 per cent in July, according to Mortgage Finder data. The increase was particularly visible among middle-income borrowers.

Applicants earning between AED 20,000 and AED 59,999 per month accounted for 62.4 per cent of the mortgage share.

This suggests that the recovery is not being driven solely by high-net-worth buyers. Middle-income households and investors are also becoming more active as financing conditions and market expectations improve.

The higher-income segment, meanwhile, faced a tighter pipeline of villas and townhouses. Limited availability in these categories may have constrained mortgage conversion among buyers seeking larger properties.

Apartments Dominate Mortgage Registrations

Dubai Land Department figures provide further insight into how different property categories interact with the financing market.

Of the 2,887 mortgages registered in Dubai during July, apartments represented 81.9 per cent of mortgage volume.

However, only 20.3 per cent of all apartment sales involved mortgages. This contrast demonstrates that the apartment market continues to include a substantial cash-buying component.

The data also highlights a different financing profile for villas and townhouses. These properties are more closely associated with owner-occupier demand and are more likely to involve financing, particularly because of their higher purchase values.

The distinction between the two segments will remain important for developers, lenders and investors as Dubai’s property market enters its next stage of development.

Rental Market Also Gains Momentum

The improvement in sales activity was accompanied by growth in Dubai’s rental market.

New leasing transactions increased by 2 per cent compared with the pre-conflict baseline. Softer rents encouraged some tenants to use the opportunity to move into larger homes.

This provides another important dimension to the Dubai property market recovery. Strong rental demand can support investor confidence because rental income remains a key consideration when evaluating residential property.

If rental activity continues to strengthen while sales transactions rise, investors may increasingly view Dubai residential property as an income-generating asset rather than simply a short-term capital appreciation opportunity.

What the July Data Means for Dubai Property Investors

The July figures suggest that the Dubai property market is entering a more balanced phase.

Transaction volumes are rising, total sales values are increasing, secondary-market activity is strengthening and expectations of further price declines are moderating. At the same time, apartments are attracting a greater share of transactions, particularly studios and one-bedroom units.

For investors, the combination of liquidity, rental demand and relatively accessible entry prices could make the mid-market apartment segment particularly attractive.

However, the latest figures should not automatically be interpreted as evidence of a broad-based price boom. The data points more clearly towards improving confidence and stabilisation than an immediate acceleration in prices.

The narrowing gap between asking and final transaction prices is particularly significant. A healthier relationship between sellers and buyers can create more predictable market conditions, potentially encouraging additional transactions during the remainder of the year.

Outlook for the Dubai Property Market

The second half of 2026 could therefore be an important period for Dubai’s real estate sector.

The return of buyers to ready homes suggests that market participants are becoming more comfortable with current valuations. Meanwhile, stronger mortgage activity indicates that financing is playing a larger role in transactions, particularly among middle-income buyers.

Apartment demand is also likely to remain an important driver because of the segment’s comparatively lower entry costs and investment potential.

The key question for the Dubai property market will be whether July’s improvement develops into a sustained trend. Continued transaction growth, stable pricing and healthy rental demand would strengthen the case for a broader recovery.

For now, the latest data points to a market that is moving from uncertainty towards greater confidence. Buyers who had previously delayed decisions because of expectations of falling prices appear to be returning, while investors are increasingly focusing on ready homes and liquid apartment stock.

If this momentum continues through the second half of the year, Dubai could see a more balanced property market characterised by stronger transaction activity, improving buyer confidence and greater alignment between asking and achieved prices.