appConfigEntityId

bodyType

customContents

entityId

entityUuid

isVideo

articlePageQuery

article

articleSchemaContent

content

hooksArticlePageAdvertisementConfigArticle

hooksArticlePageFloatingButtonConfigArticle

appConfig

filter

json

liveArticle

Cheryl Arcibal

The US-Israel war on Iran has cooled demand for homes in Dubai as buyers hold off on making purchases and businesses delay relocations of executives and staff to the Middle East, according to analysts.
The hostilities began in February with strikes in Tehran and later developed into a wider regional conflict.
“While citywide sales volumes were down just 13.6 per cent year on year in the first half of 2026, activity weakened markedly in May and June, with the number of homes changing hands falling by 45 per cent and 16.4 per cent, respectively, when compared to the same months in 2025,” said Faisal Durrani, a partner at real estate consultancy Knight Frank and the head of its Middle East and North Africa research.
“With the onset of the historically quieter summer months, we anticipate a further slowing in deal volumes.”
In some cases, the conflict triggered “panicked calls” from buyers, according to property portal Juwai IQI.
Dubai had been the world’s most active luxury housing market.
From 2023 to 2025, it beat cities such as London and New York with annual sales of homes worth at least US$10 million ranging between 426 and 499 units, according to Knight Frank.
In the 12 months to the end of March it was still the most active market, with sales of such properties hitting 581, data from the consultancy showed.
An expat-friendly tax regime and a fast-track residency programme were among the drawcards that attracted foreign investment into Dubai.
The war was also having an impact on developers, Durrani said, with the cost of building materials having risen by more than one-fifth since January across the six countries of the Gulf Cooperation Council, including the United Arab Emirates, meaning they were under pressure “to meet construction time frames”.
“With regional ports prioritising essential goods such as food, medicines and medical supplies, importing construction raw materials is likely to prove challenging and financially unfeasible, when also factoring in current shipping costs and sea freight insurance premiums,” he said.
Knight Frank and JLL, another real estate consultancy, said home prices had not collapsed despite the slowing sales volumes.
Weekly transaction values experienced significant dips compared to pre-conflict averages
Felix Cheung, JLL
“We observed a decline in home sales volume and a moderate drop in transaction values, rather than a broad collapse in core pricing – this was an underlying market trend which has arguably been accelerated by the situation,” said Felix Cheung, head of international residential at JLL in Hong Kong.
“Weekly transaction values experienced significant dips compared to pre-conflict averages as market participants paused to evaluate regional developments, particularly in the secondary market, [while] the off-plan market has shown relative outperformance.”
Since the start of the war, prices in Dubai’s mainstream market have fallen by between 5 and 20 per cent, depending on location, according to Knight Frank. That compared with an average fall of 35 per cent in the aftermath of the global financial crisis in 2008.
Durrani said the current trend “has been influenced by owners and investors exiting the market, including motivated sellers, some of whom are still exiting with profits, depending on when they transacted, and noting that prices through this cycle over the last five-and-a-half years have risen by 82.9 per cent, on average”.
Only 4 per cent of homes were resold within 12 months of their purchase last year, Durrani said, compared with the quarter of homes flipped in the same period in 2008 – highlighting the “growing proportion of genuine ‘end users’ in the market”.
But with the conflict disrupting travel flows, capital mobility and business relocation decisions, Cheung said some other investors were “taking advantage of softer market conditions”.
Mainland Chinese and Hongkongers comprised the third-largest group of foreign homebuyers in Dubai last year, accounting for 14 per cent of non-local buyers, according to media reports in Dubai.
Kashif Ansari, co-founder and group CEO of Juwai IQI, said the city remained attractive to Chinese expatriates for its lifestyle, orderliness, economic opportunities and close commercial links with China.
In November, the UAE was home to about 370,000 Chinese nationals and hosted more than 15,000 Chinese enterprises, according to a report by Xinhua.


Demand for Dubai homes cools as Middle East conflict drags on

Chinese immigrants emerge as pivotal players in Canada’s property market amid foreign ban

Tourism appeal adds to Australia’s edge in drawing mainland Chinese, Hong Kong homebuyers

Where is the priciest residential property? Hong Kong keeps crown, but livability drops

International Property

A luxury sports car is driven through Dubai’s Marina district on Tuesday. Photo: AFP

A woman walks through Dubai’s Marina district on Tuesday. Photo: AFP

Cathay Pacific delays Middle East flights as US and Iran trade attacks

A Cathay Pacific Airways plane takes off at Hong Kong International Airport. The carrier also announced it would drop its previous plan to resume freighter services to Riyadh from August 1, without specifying a new resumption date. Photo. Sam Tsang

Daily passenger flights to Dubai will be postponed until October 25. Photo: Reuters

Gold rush: Hong Kong sees sudden jump in bullion imports from Dubai amid US-Iran war

Tourists admire gold jewellery at the Gold Souq in Dubai. Photo: Shutterstock

Hong Kong Gold Exchange chairman Haywood Cheung. Photo: Enoch Yiu

Hong Kong reasserts role as safe haven in global finance amid Middle East turmoil

Helping boost Hong Kong are a pegged exchange rate, free capital flows and support from China’s economic strength. Photo: Jelly Tse

Hong Kong is the world’s biggest market for offshore yuan, with more than 1.1 trillion yuan of such deposits. Photo: Shutterstock

HSBC’s Hong Kong unit has said that some of its international clients had contacted local bankers for advice on diversifying their portfolios amid geopolitical tensions. Photo: Eugene Lee

Hong Kong ranks behind Dubai, Singapore in list of top destinations for the rich

Victoria Harbour pictured from The Peak on August 31, 2025. Photo: Sun Yeung

A photo taken on September 1, 2024, shows Dubai, United Arab Emirates. Photo: Xinhua

Dubai and Abu Dhabi vie to attract Chinese luxury property buyers

Chinese buyers accounted for 14 per cent of Dubai home sales in the first three months of the year. Photo: EPA-EFE

Seven of the top 10 areas with the highest price growth in the UAE are in Abu Dhabi, according to property developer Bloom Holding. Photo: AFP

Business

Property

International

Sales volumes fell markedly in May and June, according to Knight Frank, with rising costs adding to developers’ woes


Sales volumes fell markedly in May and June, according to Knight Frank, with rising costs adding to developers’ woes.


Demand for Dubai homes cools as Middle East conflict drags on

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Sales volumes fell markedly in May and June, according to Knight Frank, with rising costs adding to developers’ woes

Sales volumes fell markedly in May and June, according to Knight Frank, with rising costs adding to developers’ woes