Dubai real estate cools as residents find cheaper rents, better deals

Dubai's once-booming real estate market is showing signs of a cooldown, with some residents cashing in on lower rents and prices. Steve, a media sector worker who moved to Dubai last year, found a larger apartment closer to work with a 15% cheaper rent. He noted that securing a place had been difficult and rents had surged upon his arrival.

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it was really difficult to get a place in this area and the rents had gone up by a lot

The market, a key pillar of Dubai's economy, had previously soared, attracting international high-net-worth individuals. However, regional conflicts, including the US-Israel war on Iran, have dampened growth. Although Dubai's iconic sites were not directly targeted, the city's image as "safe no matter what" was affected, according to a real estate agent speaking anonymously.

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we are in some sort of grey area. I’m getting a split sentiment; people think this has destabilised the region for a long time… And there are people who say this is the right time to invest.

This shift has moved the market from a seller's to a buyer's market, with expanded negotiation margins. Knight Frank reported price drops of 5% to 20% across the city's mainstream market, a stark contrast to the average 82.9% surge since 2021. Despite this, major developers like Emaar and Binghatti are launching massive projects and selling luxury apartments, signaling confidence in a market rebound.

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Since the war, the market has shifted from a seller’s market to a buyer’s market

While sales transaction values fell by 45% year-on-year in the second quarter of 2026, particularly in the luxury sector, real estate consultancy Betterhomes noted an increase in buyer activity and deals in recent weeks. This suggests a potential recovery, though the market remains in a "grey area" with mixed sentiments among investors.

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We have already noted prices ebbing widely across the city’s mainstream market by between 5pc and 20pc, depending on location