DUBAI: Gulf real estate markets recorded strong growth in the first half of 2025, supported by resilient demand across residential, commercial and hospitality sectors, according to a new report by Markaz. The firm said lower interest rates and ongoing government spending are expected to sustain momentum through the rest of the year, despite fiscal pressures in some economies.
The UAE property sector delivered the standout performance in the region. Transaction values reached AED 239 billion ($65 billion) in the first quarter, with Dubai contributing AED 142 billion from 45,077 deals — a 30 per cent rise from a year earlier. For 2024 as a whole, Dubai logged AED 761 billion in sales, up 20 per cent year-on-year, with 226,000 transactions and more than 110,000 new investors. Rental yields in Dubai stood at 7.6 per cent in May 2025, well above global benchmarks in cities such as New York, Singapore and London.
Saudi Arabia also sustained momentum, with real estate sales climbing 37 per cent year-on-year in the first quarter and the property price index up 4.3 per cent. Residential prices rose 5.1 per cent, while commercial values increased 2.5 per cent. Markaz cautioned, however, that the Kingdom’s fiscal deficit could widen this year, though Riyadh has pledged to maintain investment in diversification projects that underpin property demand.
Kuwait posted a broad-based recovery, with sales reaching KD 896 million ($2.9 billion) in the first quarter, a 45 per cent annual increase. Investment, residential and commercial segments all recorded strong gains, with overall transactions rising 20.9 per cent. Commercial deals jumped more than 160 per cent, supported by a growing expatriate population.