Dubai's prime property market to grow 3% in 2026; 331,000 new homes in 5 years

Dubai’s prime property segment will lead the growth next year, driven by robust international demand from millionaires, the continued inflows of global wealth, and a deepening pool of resident investors, according to Knight Frank.

The global consultancy projected in its latest research that the emirate will see 331,000 new homes come online in the next five years, taking into account its best-case scenario of 70 percent of projects reaching completion.

“Our expectation for 2026 is for price rises of around 3 percent in the prime segment, while the growth in the mainstream market is likely to average around 1 percent by the time we get to the end of December 2026,” said Faisal Durrani, partner and head of research for MENA, at Knight Frank.

Due to the inflow of millionaires into the city, demand for luxury and uber-luxury properties has witnessed massive demand in the post-pandemic period.

Durrani added that record-high sales volumes, robust price appreciation, and resilient rental performance all point to a market operating from a position of strength rather than exuberance.

“While moderation in house price growth rates is inevitable, the structural drivers of demand—population expansion, wealth migration, and economic diversification—remain firmly intact. Although the rate of house price growth may be demonstrating signs of slowing, crucially, it remains positive, underpinned by robust international HNWI demand for premium homes, the continued inflows of global wealth, and a deepening pool of resident investors,” he added.

331,000 homes in 5 years

Following a huge number of new project launches since 2020 due to high demand, Durrani said housing stock, at least registered projects and units, continues to grow at a clip.

“There appears to be a very real risk of supply outpacing demand, i.e., the market’s ability to absorb all the newly developed homes. The silver lining, for now at least, is the apparent inability of the market to deliver all of the projects announced on time. Indeed, only 60 percent of promised housing was completed on time between 2022 and 2024, while this year the figure has slipped to just 46 percent between the first and third quarters of 2025, highlighting a potential contractor capacity crunch,” he said.

The global property consultancy’s best-case scenario assumed that 70 percent of all registered housing starts would be delivered on time, equating to 66,000 homes annually between 2026 and 2030, still well ahead of the long-term completion rate of 36,000 per annum. This will result in almost 331,000 homes completed between 2026 and 2030.

“Despite the inherent growing oversupply risk, we are of the view that any immediate impact on the market will likely be felt first in the locations that are expected to see the highest level of home completions. Furthermore, we also believe that any signs of a slowing in the market will be far more nuanced than in previous cycles, with ‘red flags’ first likely in specific price bands,” said Shehzad Jamal, partner for strategy and consultancy, MEA, Knight Frank.

Farooq Syed, CEO of Springfield Properties, said the market is expanding in both depth and direction. “Developers are becoming more selective, aligning supply with affordability and lifestyle needs. This equilibrium is what ensures Dubai’s continued global appeal: a market built on fundamentals, not speculation,” he said.