One of the most common questions asked about Dubai’s real estate market is, “When will the Dubai market crash?” This query often appears in the top search results for the city, indicating widespread concern. However, a deeper dive into the data paints a different picture.
Currently, Dubai’s population stands at approximately 3.2 million. Since 2021, an additional 100,000 to 150,000 residents have moved to the city, attracted by its thriving economy and lifestyle opportunities. Looking ahead, Dubai aims to grow its population to 7 million by 2040, which translates to an influx of about 200,000 to 250,000 new residents each year. With this level of growth, the demand for housing is only set to rise, whether for rental or purchase.
On the supply side, the numbers tell an interesting story. Since 2020, around 86,500 residential units have been initiated, with completion expected by 2026. Assuming an average of three occupants per unit—ranging from studios to villas—there’s already a noticeable shortfall. The current and upcoming housing supply simply does not meet the city’s growing demand.
Further compounding this issue is the booming tourism industry. Last year, Dubai hosted 17 million tourists, with the number expected to increase in the coming years. Dubai’s hotel capacity only accommodates 20% to 30% of this influx, forcing the majority to seek alternative accommodation through platforms like Airbnb. This rise in short-term rentals has added more strain to the housing market, leaving even fewer available properties for residents.
With the dual pressures of a growing population and increasing tourist demand, it’s clear that Dubai is experiencing a significant undersupply of housing. This strong demand-supply imbalance suggests that, far from a market crash, the city may continue to see real estate prices climb in the foreseeable future.