TAARIQ HALIM (ABU DHABI)
Amid geopolitical upheaval and an uncertain regional outlook for 2026, the UAE's real estate sector has stood firm, demonstrating remarkable resilience at a time when other markets have slowed.
Finance and property experts point to the country's solid fundamentals – a sound regulatory framework and astute leadership – as grounds for optimism that the UAE will emerge strong from the regional instability.
S&P Global Ratings, in a report titled "Credit FAQ: How Long Can Dubai Residential Real Estate Withstand War-Related Strains?" ruled out a market crash. A key positive highlighted in the study is the continuity of construction activity, with developers maintaining operations despite external pressures.
"We understand that construction activity continues normally, and the city has a track record of ensuring minimal construction delays during other stressors, specifically the COVID-19 lockdowns," the ratings agency said.
S&P commended the UAE's crisis management systems, noting that authorities have ensured safety, food security, and flow of goods and services, thereby reinforcing investor and resident confidence.
Another strength is the tightened regulatory environment, which provides safeguards for both developers and investors. The report noted that buyers are required to commit a significant portion of payments - typically 30% to 40% - before reselling under-construction properties, which helps maintain market discipline and reduces speculative activity.
The UAE's property market and construction sector had entered 2026 on a high. According to data from the Abu Dhabi Real Estate Centre, Abu Dhabi alone recorded Dh142 billion in total real estate transactions in 2025, representing 44% year-on-year growth. Residential transactions reached Dh76 billion, up 67% from 2024, reflecting the strong demand in the housing market.
After tensions erupted on February 28, property transaction values in the UAE dropped sharply the first two weeks of March. Real estate firms have however been encouraged by the positive reaction to that initial shock.
Dubai-based brokerage betterhomes said strong sentiment and faith in the long-term prospects of the market have not ebbed. Construction and delivery remain on track.
"What we've seen is that transaction levels in March have slowed down as you'd expect, but business is still being done," said Harry Martin, Director of Off-plan and Capital Markets at betterhomes.
"I think that comes back to delivery and construction. If we go outside and we look around, people are on site, teams are working. Things are being delivered. We should get the delivery and that should create reassurance for people wanting to invest in the UAE.
"Some good news stories, when you look at Abu Dhabi, we've had the Ohana launch. Their site on Yas Island [Manchester City Yas Residences] which achieved Dh6 billion worth of sales [in 72 hours]. So again, I want people to understand that there is activity, albeit careful activity."
Martin agreed that regulatory changes and the use of escrow accounts also propped up the market. "There's a lot of regulatory support for investors and developers and I think that will keep the market fairly stable," he said.
He added: "We feel fairly protected. There's a sense of security on the ground that's not being given to the international market."
Chief Executive Officer of betterhomes, Louis Harding, attributed this to the UAE's effective crisis management. Hosting a Dubai Property Market Update webinar, Harding said: "I think for people who are not [living] here, it's difficult to express just how well the leadership have dealt with this, and how well they will deal with it when we come out on the other side."
Founder of leading developer Emaar, Mohamed Alabbar, also believes the country is in capable hands, and this will ultimately sustain confidence in the market.
In a recent media interview, he said: "In this challenging situation, smart capital understands that a country like this with its principles and stable leadership, and the safety that it has shown, it can deliver.
"I am over the moon with its military capabilities. I am happy for the safety, and so grateful to the leadership. They had to have planned way ahead. Capital appreciates this and they will double down on investing in the UAE."
Alabbar expects an initial "cool-down" period but offered this prediction: "Consumer confidence will be shaken a little, but the policies of this country bring your confidence back so fast."