Dubai property market weakens as war hits prices

After nearly three weeks of the US–Israeli war against Iran, Dubai’s property market is beginning to show signs of strain. Analysts point to a drop in transaction volumes, while brokers report price declines in parts of the market.

Transaction volumes in the United Arab Emirates (UAE) fell by 37 per cent year-on-year and 49 per cent month-on-month in the first 12 days of March, according to Goldman Sachs data. Some properties are being sold at discounts of 12 to 15 per cent, brokers say.

One real estate agent, speaking anonymously, said the asking price for a property near the Burj Khalifa had been reduced from $735,000 to $650,000.

The conflict has dented Dubai’s image as a safe haven for wealthy investors. Attacks have struck Israel, US bases and Gulf states, including the UAE.

Shares in property developers have also weakened. The stock of Emaar Properties has fallen by more than 26 per cent since the start of the war. Analysts warn that the conflict poses a risk to Dubai’s future population growth and could deter investors.

Even so, industry representatives say activity in the market has not come to a halt.

(reuters, max)