I am watching the ongoing war situation closely in the Middle East and how it has affected trade and business activies in the region with continuous air strikes going on around major industrial and security zones. Is dubai real estate going to crash if the war prolongs and this region further descends into a long-term active war zone? What is going to happen with our investments in Dubai properties?
Dubai real estate is not in a confirmed crash right now, but it is under clear short-term pressure because of the Gulf war situation. The latest Reuters reporting says UAE real-estate transaction volumes fell 37% year-on-year and 49% month-on-month in the first 12 days of March, based on Goldman Sachs estimates. Some sellers have started offering 12% to 15% discounts on selected properties, but the median transacted price was only about 3% lower year-on-year, and transactions are still happening. That points more to a war-driven slowdown and confidence shock than a full market collapse.
The bigger risk is what happens next if the conflict drags on. Reuters also reports that Citi now sees “considerable risk” to Dubai’s population growth and buyer demand, and in its bearish case expects property prices to fall by an average of 7% annually between 2026 and 2028. That is a serious downside scenario, but it is still a correction case, not proof that the market has already crashed.
It is also important to remember that Dubai entered this period from a position of strength. The Central Bank of the UAE said Dubai’s total real-estate sales value rose 30.7% year-on-year in 2025, with off-plan activity also increasing, while Dubai Land Department has continued to report strong 2025 real-estate services growth. So the factual position today is: the market has weakened sharply because of war-related risk, sentiment and liquidity concerns, but the evidence so far supports “early correction / slowdown,” not “crash.”
