Dubai home sales drop 47% in 3Q, even as prices level off

Dubai residential sales fell sharply in 3Q as the post-conflict slowdown began filtering more clearly into registered transactions, according to Cavendish Maxwell data (pdf). Sales value dropped 47% y-o-y to AED 72.6 bn, while volumes fell 38% to 34k transactions. The consultancy says the declines reflect weaker purchasing activity as the lag between agreed sales and formal registrations starts to clear.

The slowdown is now showing up in the official numbers: Registrations can reflect deals agreed months earlier, so the impact of the war has taken time to show up in the data, as we flagged in July. Cavendish Maxwell says that lag is now clearing, and that 3Q’s declines reflect buyers becoming more cautious after the conflict began.

Off-plan is taking the biggest hit: Off-plan still dominates, accounting for 72% of 3Q purchases and 65% of sales value. But off-plan registrations fell 51.3% y-o-y and 14.1% m-o-m in September, according to ValuStrat (pdf), compared with drops of 23.5% y-o-y and 4.3% m-o-m for ready-home sales.

The twist: Prices look closer to a floor than transactions do. ValuStrat’s citywide residential value index slipped just 0.1% m-o-m in September. Values are still down 10.3% since February and 4.5% y-o-y, but the monthly decline is close to zero. Villa and apartment values each fell 0.1% on the month, and around 80% of villa communities and 77% of apartment communities saw no change at all. Apartments remain the weaker segment, down 6.4% y-o-y compared with 3.4% for villas.

The slowdown had already been showing up in the data: Average residential prices had fallen 1.7% y-o-y in August — their first annual decline since February 2021 — while transaction value across the first eight months was already down 24%. September now suggests the price correction is losing monthly momentum even as sales remain weak.

That’s been building for a while: We’ve been tracking the correction since spring, when monthly price declines were already starting to ease. ValuStrat had values down a cumulative 10% since late February as of June, meaning prices have barely moved over the summer, even as sales kept falling.