Skip to content
Monday 2 November 2026 Dubai 32°C · Sunny
Special 95 AED 4.04/L ▼ 0.24 vs October
Property

Dubai Property Investors Cautioned Against Misreading Price Correction Forecasts

By GST Updated 2 min read

Real estate investors in Dubai have been advised not to base their decisions solely on forecasts suggesting imminent price corrections, particularly those built around new housing supply data. Instead, they should consider a broader set of signals shaping the market.

In recent months, agencies such as Fitch and Moody’s, alongside property experts, have projected potential price drops of around 15% by late 2025 or early 2026.

Responding to this, Firas Al Msaddi, CEO of fäm Properties, one of Dubai’s leading agencies, emphasised that predictions based purely on the volume of units due for completion often overlook other critical market forces.

According to Al Msaddi, some of the overlooked but decisive elements include:

· Growing sales transactions despite additional supply
· Sustained investor appetite due to appealing yields
· Population growth and strong inward migration increasing end-user demand
· Rising rents at record levels supporting buying activity

“Every few months, we see forecasts that Dubai property prices are about to fall, based on one factor, that of new supply,” said Al Msaddi. “With tens of thousands of homes scheduled for delivery, as is the case in Dubai, the assumption they make is that prices must drop.

“But this market is much more complex than that. Prices don’t move in isolation. To understand direction, you need to look at demand, liquidity, rental trends, and supply together.”

Using its proprietary AI platform, DXBinteract, fäm Properties tracks seven essential signals daily, enabling investors to detect early shifts ahead of official statistics.

The seven market indicators include:

  • Bid weakness: Early signs appear when buyers resist asking prices, leading to more counteroffers, incentives, or discounts before any official data changes.

  • Days on market (DOM): The length of time needed to sell captures buyer confidence or hesitation. Longer DOM reflects slowing demand, while shorter DOM highlights increased momentum.

  • Sales volume patterns: A single weak month may not matter, but three consecutive declines could signal a meaningful trend reversal. Breaking figures down by property type and category adds clarity.

  • Inventory versus absorption: When new listings outpace buyer demand, downward pressure emerges. A consistent rise in available stock combined with sluggish take-up is an early red flag.

  • Yield compression: When purchase prices climb faster than rents, yields narrow, eventually curbing investor appetite until yields stabilise.

  • Rent and price divergence: Rising sales prices alongside stagnant or falling rents point to speculative risk, while the opposite scenario creates strong yield opportunities.

  • Mortgage and liquidity conditions: Affordability plays a pivotal role, with higher mortgage rates or tighter lending rules limiting access and slowing purchases.

Said Al Msaddi: “Dubai real estate, like any market, moves in cycles, but investors can avoid being caught off guard by monitoring all the key signals to spot shifts before they make the news.”

Reported by Stuart

Business and property: Dubai companies, deals and the property market

Stuart covers business and property for Dubai Week. He reports on Dubai and Gulf companies, their deals and results, and on the property market: sales figures, major transactions, new projects and the rules that affect buyers and investors. He also writes about technology firms expanding into the UAE, and about retail, hospitality and aviation where they bear on Dubai's economy. His reports centre on the figures, who is behind a deal and what it means for the market. Recent stories include the AED124m office sale at Vision Tower, Dubai South's May property sales and the 37% fall in UAE mergers and acquisitions.

Spotted an error? Email editor@dubaiweek.ae or read our corrections policy.

Keep reading

All Property →

Dubai This Week in your inbox every Thursday

One email. The week's changes, openings and numbers. No partner content.

We'll email you a link to confirm. Unsubscribe at any time. Privacy Protected by reCAPTCHA (Google Privacy and Terms).