According to data from Dubai-based real estate advisory VVS Estate, strategic capital now drives approximately 40 per cent of the city’s real estate market.
The firm, which draws on customer insights, sales trends and market analysis, says the shift is reshaping how risk, liquidity and long-term value are evaluated.
“While property cycles are often described in terms of volatility and momentum, Dubai’s current evolution is structural in nature, shaped by regulatory depth, improved transparency, and increasingly disciplined capital participation,” Valentina Rusu, Founder of VVS Estate said in a statement.
Dubai home prices surpass 2014 peak by 20% as institutional investors takecontrol
The observation marks a departure from the conditions that defined Dubai’s previous market peak in September 2014, when growth was characterised by momentum and speculation rather than deliberate allocation of capital.
According to the Dynamic Price Index published by Property Monitor, average apartment prices reached approximately AED1,484 ($404) per square foot in early 2025, more than 20 per cent above the 2014 high, before exceeding AED1,600 ($436) per square foot by mid-2025.
Yet VVS Estate cautions against reading the figures in isolation. “In 2014, growth was largely momentum-driven,” said Rusu. “Today, performance is supported by regulatory reinforcement, escrow discipline, standardised registration, and improved execution transparency. The difference is structural.”
Data from Savills Middle East’s Dubai Residential Market Report 2025 shows that residential transactions priced above AED5 million ($1.36 million) now account for 9 per cent of total transactions, reflecting demand for higher-value assets.
VVS Estate says growth at the top end of the market typically indicates capital deployment over the long term rather than activity driven by short-term speculation.
Insights from Property Finder further show that premium and branded residences now represent a growing share of overall transactions, with a higher proportion of deals occurring above AED 2,500 ($681) per square foot, which has pushed citywide averages higher.
“This is not inflation. It reflects a segmentation shift. Comparing today’s market directly with 2014 without adjusting for product mix oversimplifies the analysis,” Rusu said.
According to JLL’s Middle East and Africa Market Review and Outlook 2025, off-plan transactions – viewed as a proxy for capital allocation over the long term – account for more than 60 per cent of total residential transaction value, equivalent to approximately AED 223 billion ($60.72 billion).
Taken together, Savills’ pricing data and JLL’s capital-flow analysis point to a market shaped by decisions based on allocation rather than momentum.
One of the changes since the previous cycle has been the strengthening of frameworks under the oversight of the Dubai Land Department. Contract registration now operates within defined timelines through centralised systems, while escrow accounts follow milestone-based release mechanisms aligned with construction progress.
“This regulatory depth has materially reshaped Dubai’s risk profile and increased its appeal to institutional and long-horizon capital,” said Rusu.
Data from DXB Interact shows liquidity across prime communities in the secondary market, even at price points that are elevated – a characteristic of markets that have reached maturity.
Buyers are increasingly focused on net yields after service charges, resale comparables, supply-pipeline concentration and developer delivery records. “Speculative markets depend on entry enthusiasm,” said Rusu. “Structured markets depend on exit depth.”
VVS Estate argues that the change taking place in Dubai’s property market is one of behaviour rather than price. Participation is moving from decisions driven by excitement to those driven by allocation, with capital deployed in a manner that is strategic rather than reactive.
