The UAE real estate market began to show signs of stabilizing during the second quarter of 2026, as both Dubai and Abu Dhabi experienced a slight decline in property prices and rental costs. According to data from Colliers, this shift marks a transition toward a more balanced landscape following a period of rapid growth. In Dubai, average prices for apartments and villas dropped by 3 percent, while rental rates also saw a modest decrease. This cooling effect is largely attributed to improved housing supply—with over 11,000 new units delivered in Dubai this quarter—and a growing focus on affordability, which has encouraged more tenants to transition into homeownership.

Similarly, Abu Dhabi saw a quarterly correction in residential values, though prices in the capital remain significantly elevated compared to the same time last year. While rental demand has softened slightly due to increased inventory, the commercial sector tells a different story. Premium office spaces, particularly in hubs like the Abu Dhabi Global Market, remain in high demand with near-full occupancy. Meanwhile, the Northern Emirates are also navigating this cooling phase, with Sharjah and Ras Al Khaimah recording moderate dips in both sale and rental prices. Despite these adjustments, the region continues to see robust development activity, suggesting a steady long-term outlook for the UAE's property sector.