Dubai Property Market Unlikely To See '2008-Style' Crash, Says S&P

Dubai's property market will not see a 2008-style market crash due to the ongoing regional military conflict, S & P analysts said.

The ratings agency noted that some major developers have experienced significant growth in presales over few years and have a revenue backlog to cover it for several years.

The four developers S & P rated include Damac, Emaar, Omniyat, and Sobha Realty, the last of which exceeded S & P rating expectations and went from a negative to stable outlook.

S & P's base case scenario assumes the most likely scenario in the Middle East conflict, which it expects to last around two-to-four weeks.

In comparison to pre-conflict levels, S & P's base case was a slowdown in demand and price appreciation after years of rapid price increases.

No sign of broader market collapse

However, the analysts expect a slight slowdown in real estate volume, though it is not yet showing signs of a broader market collapse.

“We're not really seeing that play out just yet. The situation has definitely introduced a level of caution, but what we are seeing are lower transaction volumes,” Sapna Jagtiani, director and lead analyst of Corporate Ratings at S & P Global Ratings, said in a webinar on Wednesday.

She explained that some of these lower transaction volumes can be attributed to Ramadan, when markets are usually quiet and sales are expectedly less for the month-long period.

Strong sales

Fares Shweiky, associate director of Corporate Ratings at S & P, said developers in Dubai are entering this period from a position of strength, supported by strong pre-sales in recent years, solid revenue backlogs, and healthy liquidity buffers, which should help them absorb a short-term shock.

Dubai's property developers have recorded exceptionally strong sales over the past five years, underpinned by robust investor demand, government reforms, and the emirate's growing global appeal.

This growth has been broad-based across apartments, villas, and commercial assets, with developers consistently launching new projects that have been met with strong off-plan demand and high absorption rates.

The momentum has continued into recent years, with 2025 marking a record-breaking performance for Dubai's property sector.

Developers have benefited from sustained population inflows, rising investor confidence, and attractive residency policies, which have driven both end-user demand and international investment.

Data by proptech firm Smart Bricks indicate that a vast majority of landlords (85 per cent) are holding their assets and continuing transactions at scale, a sign that shows that the emirate's real estate sector remains structurally sound.

Even during Ramadan, when activity is usually more quiet, Dubai's real estate recorded 15,196 transactions, with a combined value of AED 50.58 billion, 5.63% YoY increase in volume and 29.7% YoY increase in value, according to Dubai real estate agency Kelt and Co Realty.

MENAFN26032026000049011007ID1110908965