R.W. COULSON & CO.
9 October 2026
Market data as of 7 October 2026
Robert Coulson · rwcoulson.com
Gulf real estate · Research perspective

The UAE shock was contained.
The regional war was not.

How our calls have played out since the war began on 28 February 2026, and three paths for the next 12 to 18 months.

Introduction · Our calls, revisited

Going into 2026, we saw Dubai home prices as stretched and expected them to fall during the year; Fitch had forecast a 15% correction by the end of 2026. The war that began on 28 February was a shock on top of that. In late February and early March we set out three scenarios for the next 9 to 12 months. Seven months on, we look back at how those calls played out, what has happened, and what to expect next.

Our call
What happened
Verdict
Before the war. After a rise of about 60% from 2022 to early 2025, prices were stretched and would fall in 2026.
They did, and faster. Values are 5% to 10% below February and now below a year ago (ValuStrat: −4.5% in September).
HELD
March base case. A contained shock in the UAE, then quick stabilisation.
The UAE held: Iran has fired at it again since August, but no damage has been reported since mid-May. Residents have returned and most flights are back. The regional war did not settle.
PARTLY
March price bands. Prime 0% to −7%; speculative −8% to −15%.
Mostly right. The broad index is down 10% since February. On a year ago, top villas are up and tourist-area towers are down 17% to 20%.
HELD
March view on buyers. Offshore buyers return within weeks only if the war follows the June 2025 pattern: a short burst of strikes, then calm.
It did not, so they stayed cautious. The war dragged on, and third-quarter home sales were still 47% below 2025.
HELD
March view on yields. Debt yields rise as lenders price in more risk.
They did. Gulf bond spreads widened, some developer bonds fell to distressed levels, and US rates rose in September. Rental yields fell as rents dropped faster than prices, narrowing the gap between rent and borrowing costs.
HELD
Bottom line: the decline we expected arrived faster, through the war. The UAE contained the shock, but the regional war followed our slow-burn case: buyers stayed cautious and borrowing costs rose. What comes next turns on the Strait of Hormuz.
What has happened
01 Shock 28 Feb to 8 Apr

Iran answered US and Israeli strikes across the Gulf; the UAE intercepted more than 2,800 missiles and drones by mid-May. UAE stock markets shut for two days, and Dubai sales values fell 29% from February to March.

02 Truce 8 Apr to 8 Jul

An April ceasefire and a June agreement brought relative calm, though attacks still reached the UAE in May. Oil fell back to near its pre-war price.

03 Relapse 8 Jul to today

The agreement collapsed in July. Iran has fired at the UAE again since August, with no damage reported. Tanker attacks hit a wartime high in the week to 5 October, and oil is near $100. Talks continue; Trump says no US strikes on Iran before 3 November.

Dubai by the numbers
−24%
Property sales, January to September (AED 379bn), back to a 2024 level
−47%
Home sales in the third quarter, versus a year earlier
−5 to −10%
Home prices since February
−9%
Rents since February
−44%
International visitors, January to August, versus a year earlier
+157,000
New residents since January (4.74 million in June)

Prices fell fast in March, then flattened

ValuStrat Dubai residential price index, % change since February 2026

0% −3% −6% −9% −12% Feb Mar Apr May Jun Jul Aug Sep −5.9% in March alone −10.2% since Feb

Rents fell about 9% from February to August (REIDIN), faster than prices. With many new homes due in 2027, apartment prices may have further to fall.

A split market: top villas up, tourist towers down

Change in value, August 2026 versus a year earlier (ValuStrat)

LOWER HIGHER Jumeirah Islands villas Emirates Hills villas Palm Jumeirah villas Dubai Hills villas Mudon villas Palm Jumeirah apartments Town Square apartments JBR apartments Burj Khalifa apartments +12.2% +7.4% −6.2% −6.8% −8.2% −8.6% −9.7% −16.9% −20.4%

Offices held up too. Grade A vacancy is 4.2% and Grade A rents are up 26% on a year ago (JLL, second quarter). Hotels took the hardest hit as visitors fell.

Three paths for the next 12 to 18 months
30%
50%
20%
Deal and reopening
Upside
Armed stalemate
Most likely
Re-escalation
Tail risk
Upside · about 30%

Deal and reopening

Talks succeed by early 2027. Hormuz reopens and oil falls below $85.

Buyers return, first to top villas and finished homes. Sales regain most of their 2025 pace by late 2027.

Watch: a signed deal; more ships through Hormuz.

Most likely · about 50%

Armed stalemate

No lasting deal before mid-2027. Hormuz stays restricted and risky; the UAE sees sporadic fire but little damage.

Sales stay well below 2025. New homes and easing rents pull apartment prices lower; Gulf and local buyers lead.

Watch: weekly tanker attacks; oil at $85 to $115.

Tail risk · about 20%

Re-escalation on Gulf soil

Strikes resume after the US midterms; Iran again hits Gulf energy sites, ports and airports, including in the UAE.

Sales fall sharply for several quarters. Forced sellers appear; local and Gulf money becomes the main buyer.

Watch: attacks on UAE soil; oil above $125.

How far prices could move under each path

Illustrative ranges over 12 to 18 months from today's level. Illustrations, not forecasts.

INVESTOR APARTMENTS TOP VILLAS −30% −15% 0% +15% −30% −15% 0% +15% Deal and reopening Armed stalemate Re-escalation −3 to +3% +5 to +10% −12 to −7% −5 to 0% −25 to −15% −15 to −10%
Around the Gulf
The standout
Abu Dhabi

Deals in the first eight months were worth more than all of 2025. Prices are 13% above a year ago but flat since February.

Steadying
Saudi Arabia

Home sales halved early in 2026 and are steadying. Riyadh offices are nearly full. Big projects are being cut; Houthis now hit Saudi airports.

Deepest dip
Qatar and Kuwait

The World Bank expects both economies to shrink sharply in 2026, then rebound strongly in 2027 if Hormuz reopens.

Important information

This is a perspective on research by R.W. Coulson & Co. as of 9 October 2026, and is subject to change without notice.

Scenarios, odds and price ranges are judgment-based illustrations, not forecasts. Actual outcomes may differ materially.

For information only. Not investment, financial, legal or tax advice, and not an offer or solicitation to buy or sell any property, security or fund.

R.W. Coulson & Co. advises investors and developers in these markets. This note uses no client information and does not represent any client's views.

Figures come from public sources believed to be reliable. They are not audited and may be revised.

Shared for background. Please check any direct quotes with Robert Coulson before publication.

Sources: Dubai Land Department; fäm Properties; Cavendish Maxwell and S&P Global; ValuStrat; REIDIN; JLL; Cushman & Wakefield; Dubai Department of Economy and Tourism; Dubai Airports; Dubai Statistics Center; Abu Dhabi Real Estate Centre; Knight Frank; Fitch Ratings; World Bank; US Energy Information Administration; Reuters; UAE Ministry of Defence and NCEMA; Critical Threats; US Federal Reserve. Full source list available on request.

R.W. COULSON & CO.
Robert Coulson · rwcoulson.com