Dubai’s rental market displayed a mixed performance in the first half of 2025, with significant differences across property types and locations. While luxury villas emerged as the strongest performers, recording rent increases of up to 53% in prime areas, several apartment and mid-tier villa communities saw prices soften as new supply entered the market.

Affordable apartments registered rent growth of up to 7%, supported by sustained demand from residents seeking budget-friendly housing. However, older districts such as Bur Dubai and Deira experienced declines of around 6.2%, reflecting tenant migration to newer developments. Mid-tier apartments posted steady growth in the range of 1% to 6%, while luxury apartments showed a slight dip of 1% to 5%, except in high-demand locations like Downtown Dubai and Dubai Marina, which achieved modest gains.

Villa rentals were more volatile. Affordable villas rose by as much as 9%, and mid-tier villas climbed 7%, yet some communities, including Al Furjan and Jumeirah Village Circle, saw declines of up to 13%.

Market analysts point to over 72,000 new units delivered by mid-2025 and the implementation of the Dubai Smart Rental Index as key factors influencing price adjustments. These shifts, combined with evolving tenant preferences for value-driven locations, are contributing to a more competitive and segmented rental landscape in Dubai.