Dubai, UAE — More than half of Dubai’s residential property transactions in the second half of 2025 were cash-based, reaching an estimated 54%, according to a new analysis by Elite Merit Real Estate. This liquidity strength has kept the market stable despite global monetary shifts, with disciplined regulation and high cash shares limiting exposure to interest rate fluctuations. The trend underscores Dubai’s appeal in a selective investment environment where capital flows toward transparent jurisdictions.
Dubai has maintained near-record transaction volumes and stable valuations, unlike leveraged markets in London and New York. Off-plan projects with guaranteed yields continue to draw investors, supported by strong fundamentals. Knight Frank’s Q2 2025 review highlighted residential sales exceeding 50,000 units for AED 267.7 billion, a 41% year-on-year increase, largely driven by off-plan dominance.
Global Easing Supports Mortgage Uptick
Central banks worldwide signaled cautious easing after two years of high borrowing costs. The US 30-year mortgage rate fell to around 6.2%, its lowest since early 2023, while European rates also declined. In the UAE, the Central Bank reduced its overnight base rate from 4.15% to 3.90% in October 2025, following a September cut, with major banks now offering home loans at 3.75–4.99%.
This gradual rate relief is expected to encourage mortgage activity, broadening access for financed buyers without undermining cash-driven resilience. CBRE’s Q2 2025 UAE market review reported residential values up nearly 14% annually, with transactions surging 23% in H1, fueled by investor shifts toward mid-luxury and sustainable developments. Dubai’s dollar peg, governance, and digital property systems further enhance its edge.
CEO Highlights Confidence as Key Driver
“While borrowing costs in the UAE are expected to ease gradually, the real driver of momentum is confidence,” said Elkhan Salikhov, CEO of Elite Merit Real Estate. “Dubai remains closely linked to global capital cycles, yet its strong governance, dollar peg, and fully digitalised property systems continue to draw institutional investors from Europe and Asia seeking predictable value. In today’s environment, trust has become the ultimate currency — and Dubai’s balance of liquidity, regulation, and transparency ensures it continues to outperform.”
Also read: UAE Property Market Buyer Sentiment 2025 Remains Strong
Elite Merit analysts project global liquidity returning in 2026 to foster steady growth, not speculation, defined by structural discipline. DXB Interact data aligns with this, showing robust cash transaction shares insulating against volatility.
Rising Appeal for Indian Investors
Dubai cash transactions attract Indian investors amid visa reforms like golden visas for properties over AED 2 million and surging off-plan sales. NRIs target areas like Dubai Marina and Business Bay for 8-15% tax-free yields, dwarfing Mumbai’s 3-5%, with direct flights and dirham stability aiding diversification. Bayut trends confirm high NRI demand in mid-luxury segments, boosted by sustainable projects.
Recent reforms and proximity make Dubai a top choice over Western markets for young wealthy Indians. Off-plan surges, like Q3’s AED 37.6 billion (USD 10.2 billion) in sales, offer entry points despite 200,000+ unit supply by 2027.
Also read: Real Estate Crash UAE? Analysts See Correction, Not Collapse
This cash-heavy structure positions Dubai for sustainable expansion into 2026, favoring governance over leverage and aligning with global shifts away from speculation. For Indian investors, it provides low-risk opportunities via high-yield off-plan deals and residency benefits, though selective timing is key amid price rises—residential values climbed 3% in Q2 alone. Balanced cash-mortgage dynamics could expand participation while preserving stability, per CBRE and Knight Frank insights.
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