MAK Developers

Here’s something that should get your attention. Dubai property prices climbed 16.3% year-on-year in August 2025. That’s not just good. That’s exceptional.

Compare that to most global markets, which are barely moving forward. London struggles with uncertainty. New York sees modest activity. Singapore grows slowly and steadily.

Savvy investors notice these gaps. Right now, Dubai’s gap looks enormous. And that gap becomes even harder to ignore once you look at the data driving it.

Why Dubai Crushes Global Competition in 2025?

Let’s talk real numbers from trusted sources. The average property value in August 2025 stood at Dh1,664 per square foot. This depicts a 16.3% increase compared to the same period a year earlier.

According to Dubai Land Department data, a total of 158,200 deals worth Dh498.8 billion were registered over the first nine months of 2025. Showing a 32.3% increase in value and 20.5% increase in volume compared with the same period in 2024.

Those aren’t small numbers. That’s massive momentum by any standard.

What makes Dubai different from everyone else?

Tax-free rental income means you keep every dirham you earn. Zero property tax and zero capital gains tax also zero income tax on rent.

Other global cities can’t match that advantage. London faces a stamp duty that maxes out at 19% for some buyers. Americans pay federal and state taxes that eat chunks of profits.

For investors, Dubai’s rental yields are among the highest globally, with an average gross yield of 6.76% in August 2025. That’s pure income in your pocket.

Breaking Down 2025 Returns Across Major Cities

Time for honest comparisons. Here’s what investors actually earned based on reputable sources:

Dubai’s performance:

• Price appreciation: 16.3% annually as of August 2025.
• Rental yields: 6.76% average gross yields, with apartments at 7.12% and villas at 4.92%.
• Combined ROI: roughly 23% when you add both together.

London’s reality:

• Prime London property prices surged by 7.4% in Q2 2025, resulting in an average price now 2.3% higher than the same period last year.
• Average rental yield: 3-4% in most areas.
• Total ROI: around 10-11% at best.

New York’s story:

• Manhattan condo price per square foot was $1,998 in Q3 2025, representing a 2.3% decrease compared to the prior year.
• The average rental price in September 2025 was $5,513, representing 6.7% growth compared to the prior year.
• Total ROI: roughly 4-5% combined.

Singapore’s outcome:

• Private home prices rose by 0.9% in Q3 2025, with cumulative growth of 2.7% in the first nine months of 2025.
• Rental prices increased by 2.4% in the nine-month period.
• Total ROI: approximately 5-6% combined.

See the difference clearly? Dubai delivered double London’s returns. It quintupled New York’s performance. It quadrupled Singapore’s careful climb.

But wait. Numbers tell only part of this story.

The Tax Advantage That Changes Everything

This deserves special attention. Dubai’s tax structure is a complete game-changer for returns.

Calculate a $500,000 property earning $35,000 yearly rent:

Dubai investor keeps:

• Full $35,000 rental income.
• Zero deductions for any taxes.
• 7% gross yield stays 7% net yield.

London investor gets:

• $35,000 rental income.
• Minus up to 45% income tax. 
• Roughly $19,250 after tax deductions.
• 3.85% net yield after taxes.

New York investor receives:

• $35,000 rental income.
• Minus federal tax up to 37%.
• Minus state tax up to 10.9%.
• Roughly $18,200 after all taxes.
• 3.64% net yield after taxes.

That’s $16,000 more per year in Dubai compared to other cities. Over ten years, that’s $160,000 extra in your pocket just from taxes.

Now multiply that advantage by capital appreciation. Dubai’s edge becomes truly overwhelming.

Market Momentum Shows Future Direction

The report shows that Dubai’s property market recorded 52,853 transactions worth AED 132.8 billion ($36.2 billion) in Q3 2025, representing a 60.8% increase compared to Q3 2023.

While the average prices rose 17.4% over the same period, reaching AED 1,913 ($521) per square foot, up from AED 1,629 ($444) in Q3 2023.

Off-plan property sales in Dubai rose to an all-time high in Q3 2025, with 42,000 units sold and transaction values reaching AED138 billion, according to Arabian Business.

That signals serious investor confidence in the market.

In London, transaction volumes fell 15.2% year-on-year between October 2024 and September 2025. Thanks to sluggish activity across the market.

Manhattan closings rose 5% year-over-year to 3,281 in Q3 2025, the highest Q3 total since 2022. Decent activity, but prices barely moved.

The trend is clear across all markets. Dubai attracts serious money while other markets face headwinds.

Rental Market Performance Comparison

The apartments in Dubai delivered a 7.12% rental yield, while villas provided a 4.92% yield in August 2025.

Specific communities demonstrated even stronger performance. Villas in Victory Heights increased by 37%, Dubai Hills Estate by 26%, and Arabian Ranches by 23.2% year-over-year.

In Prime London, rental yields average 3-5% across most segments. Manhattan vacancy rates hit 2.11%, among the lowest in the US, supporting rental demand.

Singapore rental prices increased moderately by 2.4% in the nine-month period through Q3 2025.

Dubai’s rental yields crush competition from every angle.

Where Each Real Estate Market Actually Makes Sense?

Before we jump to conclusions, let’s be real. Dubai shines, but it’s not a win in every case.

Choose London when: 

• You want established market regulations.
• Currency diversification matters to your strategy.
• You prefer outer prime markets, such as Hammersmith, Chiswick, Wimbledon, Richmond, Putney, and Barnes, which have shown strong price increases.

Pick New York if:

• You target luxury segments where nearly 70% of Manhattan condo sales were all-cash transactions in Q3.
• US economic dominance fits your thesis.
• You believe in long-term Manhattan recovery.

Go with Singapore for:

• Government-managed supply with stable regulatory oversight and planned new launches.
• Asian market exposure with strong safety.
• Long-term conservative wealth protection.

Choose Dubai for:

• Maximum tax efficiency available today
• High rental yields you can earn immediately
• Strong short to medium-term capital appreciation

Smart investors often split money across different markets. That spreads risk while capturing multiple opportunities.

Hidden Costs That Kill Returns

Global markets often seem great at first glance. But hidden costs quickly eat into your returns if you’re not careful.

In the US, property taxes range from 0.5% to 2.5% each year. That’s thousands gone before you earn a single dollar.

In the UK, stamp duty can go as high as 19 percent. You lose a big chunk upfront before your property makes any money. 

Dubai charges 4% total transfer fees. That’s it. No yearly property taxes and no wealth taxes. No inheritance taxes.

In London, 79% of properties in Prime Central London sold below asking price in Q3 2024, with discounts averaging 8.6%.

Transaction speed gives Dubai another clear edge. Purchases complete in days. London and New York take months of waiting.

What Recent Data Really Shows

Average property prices in Dubai climbed to Dh1,582 per square foot in H1 2025. This represents an 18% increase compared to the first quarter of 2024.

Total residential sales in Dubai reached Dh151.8 billion in Q2 2025, marking a 46% year-on-year increase in value.

London saw 11% more properties on the market year-on-year in Q2 2025, with new listings up 40% compared to the 10-year average. More supply creates opportunities but also price pressure.

Manhattan median price hit $1.225 million in Q3 2025, up 7% annually, marking a post-pandemic record high.

Singapore Core Central Region led price growth at 1.7% in Q3 2025, with the landed homes segment achieving 1.4% growth.

Each market has unique strengths. Dubai’s just happen to be bigger and more profitable currently.

Looking Ahead to 2026

Fitch Ratings forecasts that the Dubai property market will add 210,000 new units over the next two years. About 90,000 units are expected in 2025 and 120,000 units in 2026.

This supply will moderate explosive growth, but strong demand continues to support prices.

London market analysts expect moderate growth returning by 2026-2027 as economic uncertainty gradually clears. Recovery could take several years.

Manhattan predicts continued strength with the sixth consecutive quarter of annual contract growth through Q3 2025.

The outlook varies dramatically by each market. Dubai offers near-term strong returns. Others play longer games.

Your Next Move Depends on Goals

Here’s the bottom line from all the data. Dubai delivered 16.3% price appreciation in August 2025 while major global markets struggled or showed modest gains.

Tax benefits amplify those gains significantly. Lower costs protect your hard-earned profits. Strong fundamentals support continued growth momentum.

Does that mean rush in blindly? Never do that. Every investor has different goals. Different risk tolerance levels. Different investment timelines.

The average gross rental yield on Dubai residential property remained healthy at about 7.4% in Q1 2025.

Research specific neighborhoods very carefully. Check developer reputations thoroughly before committing. Understand rental demand in your target areas completely.

Dubai’s definitely pulling above its weight right now. But whether it’s right for you? That depends on your personal game plan. 

Frequently Asked Questions (FAQs)

Q1: How do Dubai’s 2025 returns compare to previous years?
Dubai prices now stand 90% above the pandemic-era lows of Dh833 per square foot. The 16.3% annual growth in August 2025 shows continued strong momentum throughout the year. Previous years saw even higher spikes during recovery periods from 2021-2024.

Q2: Are rental yields really that much higher in Dubai than other cities?
Absolutely. Dubai rental yields averaged 6.76% in August 2025, with apartments offering 7.12% and villas 4.92% yields. London averages 3-5% in prime areas. New York, Manhattan manages around 4-5%. Dubai’s tax-free status makes the actual gap even larger.

Q3: What about the supply concerns everyone talks about in Dubai?
Fitch Ratings notes that 210,000 units are projected for the combined years of 2025 and 2026. Experts suggest this could moderate growth, but strong demand continues. Dubai’s population continues growing, with over 125,000 transactions in H1 2025 marking a 25% year-on-year increase.

Q4: How quickly can I complete property purchases in each market?
Dubai transactions typically complete in 7 to 14 days with proper documentation. The London market is facing delays, with transaction volumes down 15.5% year-on-year and sluggish activity. New York requires extensive due diligence, which can take several months to complete. Singapore processes move faster but require careful regulatory compliance.

Q5: Which market offers the best currency stability for international investors?
The UAE dirham pegs to the US dollar, providing excellent stability. UK policy uncertainty and budget speculation have impacted the London market throughout 2025. Singapore offers government-managed economic stability with strong fundamentals. Each provides different stability profiles depending on your base currency.

Also Read:

• Why Dubai Is Still the Best City for Property Investment?
• How to Buy Property in Dubai from the USA – Complete Guide
• How Luxury Real Estate Dubai Turned Dreams into Million-Dollar Returns in Q3 2025?
• Freehold Areas of Dubai: Your Ultimate Guide to Ownership, Investment, and Growth
• Luxury Real Estate Dubai: How MAK Developers Redefine Opulence with MAK I’sola Bella