Dubai's apartment market is likely to see further price declines over the next two years as housing supply expands by roughly 20 percent, according to a new analysis from S&P Global published on October 7, 2026. The ratings agency says certain apartment segments are already undergoing price corrections, a trend it partly links to earlier UAE visa reforms that had drawn long-term investors into the market.
Transaction data for the third quarter of 2026 reflects the slowdown: total residential sales value fell to Dh72.6 billion on 34,000 transactions, down 47 percent and 38 percent respectively from the same quarter in 2025. Property consultancy Cavendish Maxwell attributes part of that drop to a clearing of registration backlogs rather than a genuine collapse in demand.
S&P Global cautioned that regional instability could persist into 2027 and 2028, potentially accelerating corrections in investor-driven segments of the market. Even so, major developers — including Damac, Emaar, Omniyat and Sobha Realty — continue to report healthy project backlogs and low payment delinquency rates among buyers.
Authorities have also introduced new mortgage rules for off-plan units, capping the loan-to-value ratio at 50 percent and requiring a minimum 50 percent upfront payment, a move aimed at supporting developer liquidity while giving buyers more payment flexibility.
Analysts say the current dip looks more like a natural rebalancing of supply and demand than a structural downturn, with the broader financing environment in Dubai's property sector remaining stable despite the short-term softness in apartment pricing.