The property market in Dubai has been on an upward trajectory for years, but not everyone is optimistic about the future. A property professional with years of experience in Dubai warns of a potential crash, and his arguments are based on concrete figures and personal observations from the market. The core of his concerns: an enormous oversupply of homes set to be delivered over the next two years, while demand cannot keep up with that pace.
The figures are indeed impressive. Over the next two years, an estimated 250,000 homes are expected to be delivered in and around Dubai. That is a gigantic amount of real estate entering the market in a relatively short time. Historically, only 56% of projects are delivered on time, meaning 44% face delays. That might sound like good news because it spreads out the supply, but the reality is that those delayed projects will also eventually arrive, just later than planned.
The real problem, according to the warning, arises with people who have purchased off-plan property with the intention of quickly reselling it, or ‘flipping’. Many buyers have paid significant sums for apartments in areas that are still under development. A concrete example: 1.8 million dirham (approximately 450,000 EUR / 385,000 GBP) for a 1-bedroom apartment in an area that still has few amenities or appeal.
Agent Promises Clash with Market Reality
Agents promised buyers that they could easily resell their property at a profit once it was ready, or even earlier. But that promise depends on a continuously rising market where demand outstrips supply. If tens of thousands of units are delivered simultaneously by the end of 2026, a huge amount of supply suddenly appears. Buyers trying to sell then find they are not the only ones. They are competing with hundreds or thousands of other sellers, putting pressure on prices.
For people who planned to resell, this becomes problematic. They cannot sell their property for the price they expected, or at all. At that point, they become forced sellers, or distressed sellers. They must sell because they cannot afford the remaining payments or because they never intended to live in the apartment themselves. This creates even more downward pressure on prices.
The expectation is that this crash will begin in the off-plan market, even before the first major wave of completions takes place. If buyers start to realise by the end of 2026 that they cannot sell as promised, they will try to sell their contracts before the property is completed. This could lead to panic selling in the off-plan segment, which would then continue in the ready property market once those units are actually delivered.
Population Growth Does Not Solve Oversupply
A common counter-argument is that Dubai’s population is growing rapidly and that this growth supports housing demand. Many people are indeed arriving, with figures speaking of 200,000 new residents. But these figures do not tell the whole story. The vast majority of new residents are low-wage workers who have no purchasing power for property.
Approximately 60% to 70% of Dubai’s population consists of low-income workers who cannot afford to buy property. They rent small apartments or rooms, often sharing with multiple people. About 30% of the total population even lives in labour camps, special accommodations for construction workers and other labourers. This group contributes nothing to the demand for purchase properties.
The actual target market for property consists of expatriates with good incomes, entrepreneurs, and high-net-worth individuals. This group is also growing, but nowhere near as fast as the total population figures suggest. And even within that group, there are limits to how many people are willing to pay 450,000 EUR (approximately 1.8 million AED / 385,000 GBP) for a one-bedroom apartment in an area without a proven track record.
On the other hand, the figures on supply are unmistakable. 250,000 units in two years is simply a lot, especially if a large part of that consists of small apartments in similar price brackets all coming to market around the same time. If demand lags, prices must fall. And if buyers then panic and try to sell en masse, that could indeed escalate.
For those now considering buying off-plan property with the intention of reselling, this warning is relevant. The strategy of flipping only works in a rising market with more demand than supply. If that balance shifts, buyers are stuck with property they cannot sell or can only sell at a loss. Especially for units purchased well above market price, this risk becomes greater.
Whether there will actually be a crash and how big it will be remains to be seen. But the signals of an impending oversupply are clearly present. For investors and buyers, it is wise to take this into account and not blindly trust agents’ promises of guaranteed profits on resale. Such guarantees simply do not exist in real estate.
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