Not Untouched, But Still Unmatched: A Mature Perspective on a Grown-Up UAE

8 min 29 sec July 10, 2026 (Edited)

Written by

Andrew Thomson

Partner, Head of Real Estate

a.thomson@tamimi.com

Andrew Thomson joins Kirsty De Sousa to discuss the key themes explored in this article in the video below, including the UAE’s evolving real estate market, the impact of geopolitical developments, and the opportunities shaping the region’s next phase of growth.

Sector Foreword

A lot of the commentary on UAE real estate over the past few weeks has missed the point. The question is not whether the market takes a hit after a geopolitical shock. Of course it does. Liquidity slows, some buyers pause, some sellers blink, and people who had convinced themselves that property only goes one way rediscover that geopolitical risk is real. Reuters has reported sharp falls in transaction activity from early March till end May, with some discounting appearing in parts of the Dubai market after the first wave of strikes.

The more useful question is: what does UAE real estate look like once the shock has passed and the market has to stand on its actual fundamentals, rather than the old safe-haven story? That is a better question, because the old story has plainly weakened.

For years, Dubai in particular benefited from a simple proposition. The wider region was unstable. The UAE was comparatively ordered, functional, open for business and tax efficient. Capital that did not want London, did not trust Beirut, did not fancy Cairo and did not want to sit in Europe looking over its shoulder could come here. That proposition was very powerful. It helped drive the extraordinary run in values between 2022 and early 2025, when Dubai residential prices rose roughly 60%.

But if missiles can reach the UAE, then the old version of ‘safe haven’ cannot simply be repeated as if nothing has happened. Reuters has reported exactly that challenge: Dubai’s safe-haven status has been tested in a way it simply never had been before.

So I do not think the right line now is lazy boosterism about the UAE being untouched by events. It plainly has not been untouched. Nor do I think the correct response is melodrama about the end of the story. That is just as unserious.

My own view is more straightforward. The UAE residential and investment market has reached a new phase of maturity. That matters more than the conflict itself.

This is now a much more settled society than it was ten or even five years ago. The expatriate base is stickier. More families have been here for a long time. More people own rather than rent. More capital is institutional. More businesses are genuinely headquartered here. Abu Dhabi has become a much more coherent investment market, and Dubai has become more like a large global city and less like a frontier trade. That is not a slogan; it is the normal consequence of a market maturing. It also means the market is less magical and, in some ways, less forgiving.

That maturity cuts both ways. On the one hand, mature markets are harder to shock into total collapse. They have deeper occupier demand, broader capital sources and more internal resilience. On the other hand, mature markets cannot live forever on a myth. If the argument for buying UAE real estate is simply ‘it is safe’, that argument is weaker than it was. The market now has to justify itself on a more serious basis.

I think it can. But the reasons people will come over the next few years will be a bit different from the reasons they came in the last cycle. They will not come because the UAE is some untouched island outside of history. It is not.

They will come because, even with geopolitical risk now factored in, the UAE still offers a combination that very few places can match: speed of execution, quality of infrastructure, relative tax efficiency, workable regulation, airport connectivity, capital mobility, family safety in the ordinary sense, and a state that is visibly trying to plan rather than merely react. That combination remains rare. It is also commercially more important than the emotional language of ‘safe haven’.

In other words, I do not think the pitch going forward is ‘nothing has changed’. I think the honest pitch is: enough has changed for the weak reasons to fall away, but not enough to damage the strong reasons. That is a healthier place for a real estate market to be.

The second point, which matters just as much, is supply. A lot of people will want to blame any slower market on geopolitics alone. That will be too convenient. Dubai in particular was already heading into a far more supply-heavy phase. Knight Frank has projected a very large delivery pipeline until 2030, and other market commentary points to substantial completions in 2026 and 2027. The exact number varies by source, but the direction of travel is clear: there is a lot more stock coming.

That matters because the next few years were never likely to look like 2023 and 2024 anyway. Even without a war, the market was moving from scarcity and momentum to choice and discrimination. Add geopolitical risk to that and you do not get a dead market. You get a more selective one.

That is why I expect the next phase of UAE real estate, especially in Dubai, to be defined by segmentation. Not all assets will behave in the same way. That was true before, but it is going to become much more obvious now.

Ultra-prime real estate will remain relatively resilient because genuinely scarce, high-quality assets aimed at globally mobile wealth operate according to their own logic. Prime family communities with real infrastructure, schools, transport logic, and established occupancy should also hold up reasonably well. The most exposed part of the market is the interchangeable middle: stock that is neither scarce nor especially well located nor institutionally differentiated. That is where oversupply bites first and hardest.

That does not mean the UAE story is broken. It means it is becoming more normal. Frankly, that is overdue. For too long, parts of the commentary around UAE real estate have treated the market as if it were powered by pure momentum and narrative. Buy because everyone else is buying. Buy because prices went up last quarter. Buy because conflict elsewhere sends money here. That is not a proper investment thesis. It is trend following, dressed up as conviction.

A more mature UAE market will require people to think a bit harder. Why this asset? Why this district? Why this developer? Why this tenant base? Why this exit? Why this cap table? Why this legal structure? Why this hold period? That is not bad news. It is what serious markets look like.

The next few years, in my view, will therefore not be about whether the UAE remains a perfect sanctuary. It is clearly not that. They will be about whether it remains one of the most functional places in the region and, increasingly, one of the most functional places between Europe, Asia, and Africa to live, deploy capital, and run a business. I think the answer to that is yes.

Why will people still come? Some will come because they are already half here. They have children in school, businesses on the ground, and capital tied into the region. This is now a far more residential market than it used to be.

Some will come because the alternatives are not obviously better. Europe offers depth but often not speed, tax efficiency, or the same ease of regional deployment. Other regional centres may offer opportunity, but not the same institutional comfort or operational convenience.

Some will come because the UAE has become less of a temporary posting and more of a medium-term base. That is a major shift. Mature societies do not need everyone to arrive in a rush. They just need enough of the right people to stay.

And some will come because, even in the current environment, the UAE still looks like a place with a plan. Abu Dhabi in particular has been benefiting from that perception: quieter than Dubai, less theatrical, but clearer in direction. That has come through in market commentary and, frankly, in what one sees on the ground.

So my own forecast is not exuberant, but it is positive. I do not think the next two or three years will look like the last two or three years. Price growth should moderate materially from the last run. Analysts cited in recent market commentary broadly expect a new maturity phase, rather than another straight-line boom, with more modest growth and more divergence between segments.

I expect more negotiation, more failed launches, more incentives, more focus on quality, and less tolerance for mediocre products. I expect the market to become less emotional. I expect stronger sponsors and better assets to do fine. I expect weaker stock to discover price. I expect lawyers, lenders, asset managers and serious investors to be busier than the headline readers imagine.

And I expect the best part of the UAE’s real estate market over the next few years not to be the old fantasy that it is immune from the region, but the more sober fact that it is still better organised than most of it. That may sound like faint praise. It is not.

In real estate, especially in this part of the world, competent systems matter. Registries matter. Enforceability matters. Roads matter. Airports matter. Planning matters. Schools matter. The ability to move capital matters. The ability to complete a transaction without institutional chaos matters. The UAE still has those things.

So no, I do not think it is enough any more simply to say that the UAE is a safe haven. That phrase now carries less weight than it did. But I also do not think the conclusion from recent events is pessimistic.

The better conclusion is that the market has grown up. It is more settled than ever. It has taken its first real strategic shock. It is unlikely to retain the easy premium that comes from being seen as untouched.

But if it can no longer sell itself as untouched, it can still sell itself as efficient, credible, liveable and investable. That is a more adult proposition. And, in the long run, probably a healthier one.