Transactions that were suddenly put on hold due to the war’s uncertainty are just now starting to close, especially with buyers who had waited on the sidelines
As the prospects of a permanent peace deal look increasingly imminent, Dubai’s real estate activity is already showing positive results. Property developers in the emirate say they have already seen improved sentiment and activity as a result of ceasefire discussions.
Dubai’s property market saw a slight decline in capital values, according to consultancy group ValuStrat, where average capital values fell by 5.9 per cent, 1.9 per cent, and 1.2 per cent in March, April, and May, respectively. At the same time, the annual capital value growth remains positive at 2.5 per cent, according to ValuStrat.
For transactions that were suddenly put on hold due to the war’s uncertainty, Grovy Developers CEO Abhishek Jalan said they are now starting to close. This has been especially true for buyers who had waited on the sidelines for an extended period, up to three years.
“Additionally, there has been an increase in leads and pipeline activity that will be a solid early sign that there is an increasing level of confidence returning,” he noticed.
The most active market segment the developer expects to see, as long as conditions remain stable, will be below Dh3 million. Jalan said this segment has seen the highest transaction volume, with buyer participation generally remaining above average even amid geopolitical uncertainty.
“There will be moderate activity in the Dh3-5 million market segment and much lower activity in the above Dh5 million luxury market segment as this segment has been the most impacted to date,” he added.
Shift to buyer’s market
As market conditions ease, the dynamics are shifting from a seller’s market into a buyer’s market, said Sarah Serhan, an associate at BenCo Real Estate.
“We have certainly observed an obvious shift in market dynamics,” she told media. “However, there is a widespread misconception about what a ‘buyer’s market’ actually means in the current landscape.”
The real estate expert, who also stars on the reality show ‘Million Dollar Listing: Dubai’, explained that many buyers expect to find properties priced 10 to 20 per cent below their original price. “This expectation misreads the structural health of the current market, drawing false parallels to the 2008 financial crisis. The fundamentals today are entirely different,” she said.
Serhan clarified that sellers are choosing to leverage the strong rental market rather than liquidating at a loss. She added that they prefer to generate consistent cash flow and hold their assets until the market fully stabilises.
“In short, while demand is cautious, premium supply remains highly protected,” she said.
Betterhomes, a Dubai-based real estate agency, also observed notable changes, with Dubai’s property market entering its first meaningful price-discovery phase since the regional conflict began on February 28.
More selective market
Currently, the key signal is a more selective market in which pricing discipline is becoming critical, the agency said, rather than a lack of demand. After three months of data from BetterHomes, the market is now showing a clearer shift in buyer, seller, landlord and tenant behaviour.
“Taking a property off the market does not improve the chance of achieving the right price,” Louis Harding, the CEO of BetterHomes, said. “The market is telling sellers something very clearly: if you want to transact, you need to show value from the asking price, not leave room for future negotiation. Buyers are watching, comparing and waiting.”
The next phase of the market will be shaped by realistic pricing, sharper decision-making and the ability to read demand in real time, according to the agency.
“The market has not disappeared,” Harding said. “It has become more discerning. Sellers and landlords who show value early will stay visible. Those waiting for the market to meet inflated expectations risk being ignored.”
