Dubai and Abu Dhabi have positioned themselves as the favorite destination of the richest people on the planet thanks to very lax taxation and great possibilities to obtain profitability with a rising real estate market. Luxury apartments on the artificial island of Palm Jumeirah, penthouses with views of the Burj Khalifa or luxury mansions on the seafront They were sold in hours to newly arrived millionaires.
The Iranian missile attacks on airports, ports and residential areas of the United Arab Emirates have suddenly shattered the image of a safe haven that the region had built for decades. The real estate market, which seemed bulletproof, faces your first challenge: not to sink in the face of the uncertainty of war.
The boom that no one wanted to stop. The real estate boom in the Emirates is supported mainly by the investments that foreign millionaires have made in the country to obtain your residency. The UAE offered zero income taxes, long-term visas for investors, and political stability that few countries in the area could boast. By 2025, nearly 90% of the UAE’s more than 11 million residents were expatriates, according to data collected by Reuters.
The result was an off-plan apartment sales machinery that worked at full capacity. According to the report ‘Dubai Residential Real Estate FY 2025‘ the consulting firm Betterhomes, 65% of real estate transactions in Dubai in 2025 corresponded to off-plan homes that did not yet exist. Promoters launched projects and sold them out in hours. In Abu Dhabi, real estate prices rose by around 32% in 2025 alone from the previous year, according to the report ‘UAE Real Estate Market Review Q4 2025‘ from CBRE.
And then the missiles came. On March 4, the markets of Dubai and Abu Dhabi reopened after two days closed due to missile attacks launched by Iran against US interests and its allies in the area. Shares in Aldar Properties, Abu Dhabi’s largest listed developer, and Emaar Properties, the company behind the Burj Khalifa, fell 5% in a single session. The bonds of large developers also collapsed and the debt market, key to financing new developments, was practically blocked for new issues.
A senior banking manager in the sector explained to Reuters that his firm canceled that same week a capital raising operation for the UAE real estate market. “Investors are not thinking about investing in the region at the moment,” he said, adding that the risk associated with property in the UAE had become “much higher”.
Records and sales at the same time. In the midst of the confusion of the bombings, Dubai closed one of its most striking operations of recent years. A 2,900 m2 apartment in the Aman Residences Dubai project, in the coastal neighborhood of Jumeirah 2, was sold for 422 million dirhams (about $115 million), becoming the third most expensive apartment sale in the history of the emirate. It is only surpassed by an operation of 550 million dirhams in Bugatti Residences in 2025.
But at the same time, the platform PanicSelling.xyz, that monitors prices on more than 20,000 luxury properties in Dubai and Abu Dhabi, detected 82 discounts that totaled 14.3 million dollars in just a few days after the Iran attacks. Dale Buckner, CEO of Global Guardian, explained to CNBC that the exodus of expatriates showed no signs of slowing down and that just that morning his company had seven corporate clients looking to evacuate between 1,000 and 3,000 employees. “This situation is similar to Ukraine,” Buckner said.
The storm that was already seen coming. What aggravates the situation is that the problems do not only come from outside. JPMorgan analysts they already warned before the attacks that Dubai’s population growth would likely not absorb the 300,000 to 400,000 new homes expected by 2028. The market already had an oversupply problem on the horizon before the missiles arrived.
Ryan Lemand, co-founder and CEO of Neovision Wealth Management in Abu Dhabi, summed it up: “Real estate investing depends on stability, visibility and investor confidence, and all of these factors tend to weaken during prolonged periods of geopolitical uncertainty.”
The excess real estate supply and a complicated geopolitical situation have kept the interest of investors for properties in Abu Dhabi and Dubai, suggesting the best time to invest in the area. The risk in this case is not in profitability, but in the precision of the missiles.
Image | Unsplash (Duane Mendes), Wikipedia
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