Dubai’s new home buyer initiative sparks Dh90-billion property transaction boom

Programme Launch and Market Impact

Dubai’s real estate market, traditionally a magnet for wealthy individuals and international investors, is undergoing a fundamental transformation following a landmark initiative.

According to data from the DLD, Dubai’s real estate market witnessed transactions reach Dh90 billion in July and August, up nearly 12% YOY, driven by the launch of the First-Time Home Buyer Programme in July 2025.

The initiative has unlocked doors for Emiratis and emigrants who previously encountered homeownership as out of reach, insinuating fresh momentum into the market. Spearheaded by the Dubai Land Department (DLD) and the Department of Economy and Tourism (DET), the programme is already hailed as a game-changer for Dubai’s housing landscape.

Key Features of the Programme

At its essence, the programme presents aspiring homeowners with priority access to new launches, preferential prices, and tailored mortgage solutions. Partaking developers, from giants like Damac, Emaar, and Nakheel to fast-growing players like Danube and Binghatti, have committed to allocating at least 10% of units in new and ongoing projects in the UAE priced below 5M Dirham to first-time buyers.

This responsibility is designed to soothe entry into the market for middle-income families, a component historically squeezed by prompt price escalations. Banks, including Emirates NBD, Dubai Islamic Bank, and Mashreq, have also introduced bespoke financing products with lower interest rates, faster approval processes, and flexible repayment options.

Alignment with Dubai’s Economic Strategy

Officials highlight that the programme aligns seamlessly with Dubai’s 2033 Real Estate Strategy and the wider Economic Agenda D33, desiring to double the emirate’s GDP and improve homeownership percentage. “By lowering entry barriers to homeownership for Emiratis and expatriates alike, we are enhancing investor confidence, increasing market absorption rates, and reinforcing Dubai’s global positioning as a city where personal aspirations and business ambitions converge,” said Helal Saeed Almarri, director general of DET, at the launch event.

Reshaping the market narrative

Analysts record that a sizeable percentage of this growth came from smaller off-plan apartments, especially 1-bedroom and studio units in appearing districts such as Dubai South, Al Furjan, and Jumeirah Village Circle, locations now laboriously marketed under the first-time buyer plan. Betterhomes reported a 15% growth in enquiries from previously rented residents, mentioning the programme as a motivation for their decision to purchase.

“The First-Time Home Buyer Programme has reshaped the market narrative in just two months since its launch. It has bolstered transaction volumes, attracted thousands of new entrants, and reassured developers wary of oversupply,” said V. Sivaprasad, chairman of Condor Developers.

Meanwhile, V.S. Bijukumar, a Dubai-based property consultant, added: “Most importantly, it signals a maturing real estate sector that balances global capital with local aspirations, ensuring Dubai remains one of the world’s most competitive cities to live, work, and invest.”

Tenants-focused scheme

For tenants, the scheme is especially appealing. Dubai rents have overflowed recently, with average annual apartment rents rising to AED85,000 by mid-2025 and villa rents climbing to AED190,000. Mortgage-backed ownership, particularly with flexible payment plans and waived DLD fees payable in instalments, is a cost-effective option to long-term renting. The plan effectively flips long-standing tenants into end-users, decreasing dependence on hypothetical investment and creating a more proportional market.

Managing Oversupply Concerns

Meanwhile, developers are considering the programme to be a stabiliser during a record housing supply. Over 150,000 new units will be handed over between 2025 and 2027. Oversupply problems began to appear, with credit agencies warning of a possible correction by 2026. By extending the pool of authentic end-users via incentives for first-time buyers, Dubai guarantees demand maintains pace with supply. Omar Bu Shehab, Director General of DLD, noted that the initiative “empowers individuals and families to invest in their futures while supporting the Dubai Real Estate Strategy 2033’s broader objectives of inclusivity and resilience.”

Strong Market Fundamentals

Market fundamentals remain strong. Dubai’s residents, who have just crossed 4 million, continue to grow at around 5 to 6% annually, spurred by pro-residency reforms such as the Golden Visa and remote work permits. Household sizes are shrinking, from 4.4 people in 2019 to 3.9 in 2025, forming a natural need for more housing units even without net migration. Overlaying this demographic change is the constant inflow of finances. Henley & Partners’ latest wealth report shows Dubai now hosts over 80,000 millionaires, with that number projected to climb further as global capital seeks havens of stability.

Boosting the Mid-Market Segment

Dubai is widening the demand base outside its standard investor-heavy market by explicitly targeting first-time buyers. Analysts indicate this will help ease the impact of potential supply-driven corrections. CBRE noted that the programme is particularly efficacious in boosting absorption in the mid-market component, which has historically been underserved, similar to the luxury tier. “The First-Time Home Buyer initiative is not just social policy; it is a liquidity driver that directly supports market depth at a crucial time,” commented one analyst.

Commitment to affordability

The plan also allows developers to showcase a dedication to affordability. Deals on off-plan launches, enhanced payment terms, and reliable mortgage packages construct a more sustainable sales model. For banks, the inrush of mortgage demand endows their diversification away from corporate lending, which has slowed amid global interest rate volatility.

The initiative goes beyond being a housing policy; it acts as a strategic driver of economic stability, social cohesion, and sustainable growth in the property market. “By giving first-time buyers preferential access, Dubai is not only strengthening homeownership but also creating a stickier resident base—families and professionals invested in the city’s future rather than transient renters,” Bijukumar added.