Dubai’s residential property market has entered a cooling phase in 2026 after multi-year gains, with ValuStrat’s index at 218.8 points in August, down 3.1% year-over-year and 10.2% from its February peak. Transaction volumes through September fell sharply from 2025 levels, reflecting higher new supply deliveries, selective buyer behavior, and the impact of regional geopolitical tensions that began in late February. Prime and luxury segments have shown greater resilience, supported by international capital inflows and long-term residency programs, while overall prices face downward pressure from elevated bubble-risk metrics and an expected 5% adjustment this year. Key near-term influences include ongoing project completions, mortgage-rate sensitivity following the UAE central bank’s September hike, and any improvement in external sentiment that could stabilize demand through year-end.