Unlike Saudi Arabia and Oman, whose stock markets rose on higher oil prices, the UAE's economic model, based on tourism, real estate, logistics and finance, has been hit hard. The war also means a significant risk to the future growth of Dubai's population, writes middleeasteye.net.
Over the last month, the market capitalization of the stock exchanges in Dubai and Abu Dhabi has fallen by over USD 120 billion, and over 18,400 flights have been canceled, the portal calculates.
See also: Dubai does not guarantee zero PIT. Poland is demanding its taxes
Apartment with a view of the war. Real estate with a discount of up to 15 percent.
Although most of the missiles Iran fired at the UAE were intercepted, shrapnel continued to cause damage in Abu Dhabi and Dubai, including the Burj Al Arab, Palm Jumeirah (Dubai's famous skyscraper and island), and the industrial zone and port of Fujairah.
The “Dubai brand,” long used to portray the United Arab Emirates as more than just oil, has suffered a particularly hard blow.
Reuters reports that some properties are now being sold at discounts of up to 10-15 percent by people looking for a “quick exit”.
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Adam Ziemienowicz, Mateusz Krymski / PAP / photos
Dubai real estate under pressure
One of Dubai's crown jewels, the real estate market, is currently under severe pressure. Back in late 2025, British consulting firm Savills described Dubai as “one of the most dynamic real estate markets in the world.” The value of the transaction exceeded USD 147 billion.
This trend has suddenly reversed. By the end of March, the Dubai real estate market index had fallen by at least 16%. Goldman Sachs analysts estimate that the number of transactions decreased by 37%. year to year, and sales dropped by over 50%. compared to February 2026
Shares of developers such as Emaar Properties, behind the Burj Khalifa, fell by more than 25%. – writes middleeasteye.net.
See also: Polish investors choose Dubai. What will the war in the Middle East change?
The end of Dubai's golden era? “Significant risk” to population growth
For two decades, Dubai and Abu Dhabi have presented themselves as islands of stability in an unstable region, attracting investors, tourists and foreigners. Now, as the war enters its second month, this model is beginning to break down.
According to Citi the war also introduced “significant risks” to Dubai's future population growth — analysts currently predict growth of just 1 percent. this year and about 2 percent. per year until 2031, which is well below the recent trend of 4%.
The war in the Middle East is hitting the pillars of the UAE economy
According to Morgan Stanley, the United Arab Emirates, and Dubai in particular, have driven retail growth in the Middle East region, accounting for about half of luxury goods sales in the region.
Hotel bookings have plummeted. At the same time, the UAE's aviation sector, a pillar of its economy, has been directly affected. Iran launched retaliatory attacks unprecedented disruptions to air traffic. Dubai International Airport, one of the busiest in the world, serving around 95 million passengers a year, was damaged by Iranian attacks.
Dubai had aspirations to be not only a regional but also a global financial center.
Source: Middle East Eye
