How much will Dubai property prices rise in 2026? Offices tipped to outperform homes

The Dubai residential property market is expected to shift into a more normalised phase in 2026, with price growth moderating sharply from recent highs, while the office sector is forecast to remain a standout performer, according to the latest outlook from ValuStrat.

In its Dubai Real Estate Outlook 2026, ValuStrat forecasts residential capital gains of around 10 per cent next year, down from 19.8 per cent in 2025, as the market cools following several years of rapid appreciation.

In the consultancy’s base case, residential rents are expected to be broadly flat (0 per cent), reflecting a softer leasing cycle and tighter affordability conditions.

By contrast, office capital values and rents are both projected to rise by around 15 per cent, supported by ongoing corporate expansion and a persistent shortage of Grade A supply in prime locations.

Dubai real estate forecast

Haider Tuaima, Managing Director and Head of Real Estate Research at ValuStrat, said:
“Dubai’s underlying demand drivers remain intact into 2026, but performance is likely to become more segmented.

“Our base case assumes slower overall residential price growth, with villas continuing to outperform apartments due to supply composition and lifestyle demand.

“In offices, the imbalance between prime demand and new supply remains the core support for continued rental and capital value growth.”

ValuStrat expects residential prices to continue rising in 2026, but at a slower pace and with a widening performance gap between property types. Villas and townhouses are forecast to increase by 17.7 per cent, significantly outperforming apartments, which are expected to rise by 7.4 per cent.

Demand is projected to remain strongest for single-family homes, which account for less than 20 per cent of Dubai’s total residential stock, while the development pipeline remains heavily skewed toward apartments.

The residential supply pipeline for 2026 is forecast at 131,234 units, comprising approximately 81 per cent apartments and 19 per cent villas and townhouses.

ValuStrat notes that annual delivery forecasts are often revised due to construction timelines, which may affect actual supply in 2026. Transaction volumes are also expected to cool, reflecting a slower cadence of new off-plan project launches compared to previous years.

Dubai rental market 2026

In its base case, ValuStrat forecasts flat residential rental growth (0 per cent) in 2026. The outlook highlights that leasing markets are increasingly shaped by affordability constraints, evolving tenant preferences, and the balance between new supply and household formation.

Dubai’s office market is expected to remain supply-constrained in prime submarkets, underpinning continued growth in both capital values and rents. ValuStrat forecasts around 15 per cent growth in office capital values and rents in 2026, moderating from stronger gains recorded in 2025.

Based on developer estimates, 153,122 square metres (1.65 million square feet) of office gross leasable area is expected to be delivered in 2026, bringing Dubai’s total office stock to 9.94 million square metres (107 million square feet).

Beyond residential and offices, ValuStrat’s outlook highlights continued support for hospitality performance, underpinned by Dubai’s positioning as a global tourism and events hub. In the industrial sector, demand is expected to continue outpacing supply, supporting further price growth.

Retail performance, however, remains shaped by structural shifts in consumer spending patterns and ongoing e-commerce penetration, as the sector continues to adjust to changing market dynamics.