Current slowdown is not being driven by distress selling, with over 60% owners planning to hold on to properties or expand portfolios.
The UAE residential market continues to demonstrate underlying resilience, with nearly 45% respondents indicating an intention to purchase property within the next 12 months, according to Savills Middle East’s latest UAE Residential Investor Sentiment Survey, conducted among a cross-section of market participants including investors, end-users, landlords, tenants and prospective residents.
The findings highlight that while regional geopolitical developments have introduced a degree of caution into the market and led to delayed decision-making, demand remains firmly in place. A further 32% of respondents remain undecided about property purchases, evidencing a longer consideration period rather than a decline in overall interest.
Importantly, the current slowdown is not being driven by distress selling. More than 60% of existing property owners indicated that they plan to either hold or expand their portfolios over the next six months, with only around 4% considering selling. This lack of selling pressure is helping to support pricing across several segments, despite a growing gap between buyer expectations and current market values where sellers are holding firm.
Following a sustained period of strong growth, the UAE residential market is now transitioning into a more balanced phase. Transaction activity remains elevated by historical standards, supported by strong fundamentals including long-term population growth, continued capital inflows and a robust development pipeline. However, momentum has moderated in recent months since the conflict began, particularly within the secondary market, as buyers adopt a more measured approach in light of evolving external factors. Even for the off-plan segment, amid fewer launches since March, a clearer picture will emerge once the earlier property registrations are fully reflected.
The survey already shows a clear preference for ready properties over off-plan among participants, reflecting a broader shift towards certainty in delivery, pricing and immediate usability. Approximately 60% of respondents indicated a preference for completed assets, compared to around 23% for off-plan properties.
Also highlighted in the survey is a maturing and increasingly end user-led buyer base, with demand supported by a mix of owner-occupiers and long-term investors rather than pure speculative activity. This shift is contributing to greater underlying stability, even as sentiment softens in the short term.
At the same time, pricing sentiment has shifted, with over 80% of respondents expecting prices to either soften or remain stable over the next 12 months. This has contributed to longer transaction timelines, increased negotiation activity and a more selective approach from buyers, particularly within the apartment segment where supply is perceived to be in greater availability.
Supply continues to be on respondents’ minds, with over 60% believing that a high volume of new units is entering the market. The apartments segment is likely to be more sensitive to new supply, given the abundance in availability, compared to villas and townhouses.
Commenting on the findings, Andrew Cummings, Head of Residential Agency at Savills Middle East said, “While regional developments have understandably introduced a degree of caution into the market, the data clearly shows that demand remains intact. What we are seeing is a shift in behaviour rather than a drop in interest, buyers are taking more time, becoming more selective and focusing on fundamentals such as location, quality and long-term value.
At the same time, the absence of widespread selling pressure reflects continued confidence among existing property owners, many of whom are well-positioned following the strong performance seen in recent years. As a result, the market is moving towards a more balanced and sustainable phase, rather than experiencing any structural correction.”
Outlook
Regional and geopolitical uncertainty has emerged as the primary barrier to market entry for many buyers, outweighing traditional considerations such as pricing or financing.
Looking ahead, Savills expects the market to continue adjusting in the near term, with softer transaction volumes and more deliberate deal-making. While certain segments—particularly secondary apartments, may experience greater pressure, villas and prime residential assets are expected to remain relatively resilient. Over the medium term, market performance will be shaped by the pace at which confidence returns and how effectively new supply is absorbed. Ultimately, the UAE’s strong underlying fundamentals position it well for recovery with long-term demand drivers remaining firmly intact.
