Dubai’s residential property market experienced a moderate recovery in July 2026. According to the Dubai Land Department (DLD) figures, the sales transactions increased by 2%, while the overall value of these transactions rose by 3% compared to June. This improvement follows a slow period earlier in the year, primarily affected by regional instability. Notably, apartment sales were the main contributors to this uptick, particularly high-value deals exceeding AED15 million, which surged by 22%. However, despite this month-on-month recovery, the year-on-year data reveals a more somber picture, with total transaction volumes plummeting by 32% and total deal values declining by 49% compared to July 2025.

Growth in Apartment Sales

Apartments emerged as the leading category in July’s sales rebound, marking a 5% increase from the previous month. In contrast, villa and townhouse sales dwindled by 12%, highlighting a significant divergence in property performance. The average transaction price for apartments has dropped 26% compared to the same month last year. This suggests that while short-term market activity is improving, long-term indicators remain weak. The disparity between stronger monthly figures and subdued annual metrics indicates a potential stabilization phase following previous market shocks, although the level of activity has not yet returned to last year’s highs.

The luxury property segment demonstrated even more robust performance. High-value transactions of AED15 million or more grew by 22% month-over-month, primarily driven by the secondary market, which saw a remarkable 31% increase in transactions. Off-plan luxury sales also saw growth but lagged behind secondary market activities with a 17% rise. Compared to the same time last year, the luxury market overall remains down by 46%, despite off-plan luxury sales showing a promising 13% increase from last July.

Rebounding Rental Market

Rental market activity remained vigorous, with inquiries for rental properties rising by 21% year-on-year, although they dipped slightly by 4% from June. This demonstrates sustained interest from tenants over the past year, even amid fluctuating market dynamics. Apartments attracted the most demand, with leasing inquiries up 25% compared to last year, while interest in villas and townhouses fell by 20%. The most popular areas for apartment rentals were Dubai Marina, Jumeirah Beach Residence, Downtown Dubai, Dubai Hills Estate, and Jumeirah Village Circle. In terms of villas and townhouses, the favored neighborhoods included Arabian Ranches, The Springs, Al Furjan, Tilal Al Ghaf, and The Villa.

Overall, the data for July reflects a market gradually regaining stability after a tumultuous period. Key sectors to keep an eye on moving forward include the secondary and luxury markets, which have been vital in driving July’s positive figures. Additionally, the strong demand for rental properties is an encouraging sign, particularly given that it appears more resilient than buyer interest based on recent inquiry trends.

Richard Waind, the CEO of betterhomes, acknowledged that July’s statistics indicate a market in recovery, with both transaction numbers and values improving from June. Despite the annual comparisons still lagging, the active tenant demand alongside month-on-month growth in sales offers an optimistic outlook for the second half of the year. This trend may suggest potential for more robust recovery as market conditions improve and investor sentiments shift positively.