The Dubai property market was previously characterized by robust sales and rising prices, attracting both local and international investors. However, the landscape has shifted dramatically since late February, when geopolitical tensions escalated following US and Israeli strikes on Iran, leading to retaliatory attacks from Iran.
Recent data reveals that Dubai property sales have collapsed by 44 percent year-on-year. From February 28 to March 22, only 8,059 property sales were registered, a stark contrast to the previous year’s performance. Home prices have also taken a hit, with a decline of approximately 4-5 percent compared to the same period last year.
The median value of a residential property in Dubai now stands at around $99,250, with the per square foot price averaging $500. Despite the overall downturn, the luxury segment remains somewhat insulated, with high-end deals still occurring, some exceeding $2,000 per square foot.
Transaction volumes have also plummeted, dropping 25.7% from $7.55 billion to $5.61 billion. This decline indicates a significant retreat from the market, particularly among investors who seem to be adopting a wait-and-see approach amid the ongoing conflict.
Experts note that the Dubai Financial Market Real Estate Index has lost more than a quarter of its value in just a month, reflecting the broader concerns about the stability of the property market. An anonymous Dubai-based real estate consultant remarked, “This trend shows that the investor class is largely staying away from the market, or at least they have taken a pause given the current circumstances.”
While some areas, particularly in Downtown Dubai, continue to see steady prices and large deals, the overall sentiment is one of caution. The consultant added, “The properties that they purchased were also on the edge of the main city.”
Looking ahead, the impact of the ongoing conflict on future property sales remains unclear. Experts warn that a prolonged conflict could further erode international investment and put additional pressure on the sector.
Details remain unconfirmed.