In this article
Kooky
Builder of Shaka, the payment router that pays every agent their commission on closing date.
About Kooky and Shaka →S&P Global Ratings expects the number of homes in Dubai to grow by 20% over the next two years, apartments in particular, and says that this new supply could push apartment prices lower. The view comes from a question-and-answer document the rating agency calls a Credit FAQ, reported by Khaleej Times on 7 October 2026 and by Zawya on 8 October.
The document looks at what the regional war, now seven months old, means for Dubai's residential market in 2027 and for the companies that build and finance it. Its starting assumption is stated by the agency's credit analyst, Sapna Jagtiani. "Our base case is that the Middle East disruptions will continue into 2027," she said, as quoted by Zawya.
Everything that follows is S&P's assessment, built on that assumption. It is a scenario from one rating agency, relayed by the press, and it is reported here as such.
S&P Global Ratings, as reported by Khaleej Times and The National on 7 October 2026. The price range is one S&P takes from industry reports.
What the Credit FAQ is
The document carries the title "How Will The Middle East War Reshape Dubai's Residential Property Market in 2027?". The data firm IndexBox, which summarised it on 7 October, gives that day as its publication date and names Sapna Jagtiani as the S&P credit analyst behind it.
A Credit FAQ is organised around questions rather than around one headline number. According to Zawya, the questions here go well beyond house prices. The document covers the credit ratings of developers, payment delinquencies and construction delays, funding and liquidity, the capital spending and dividends expected from the developers S&P rates, and the exposure of Dubai's banks if the price correction speeds up.
Related readSingapore shophouse sales rise to 21 in the third quarter as value fallsThat list says who the document is written for. It is a paper about the ability of companies to meet their obligations, and house prices matter in it because they feed into that question. For a reader who owns or is weighing a Dubai apartment, the interest lies in the same chain seen from the other end: what the agency thinks will happen to supply, how it expects prices to react, and how sturdy it finds the developers and lenders standing behind off-plan homes, meaning homes sold before they are completed.
The press summaries are not the document itself. Zawya's account, credited to a staff writer, lists the subjects on developers and banks without giving the figures attached to them. Khaleej Times and The National, both on 7 October, supply the numbers used in this article.
The supply figure
The central number is the 20%. Khaleej Times reports that S&P expects Dubai's stock of residential units to grow by that proportion over the next two years, and that the increase concerns apartments in particular.
The agency links that pipeline directly to prices. In Zawya's account, S&P says new deliveries in 2027 and 2028 could accelerate the price correction, and that the effect would be felt most in the apartment segments driven by investors. Khaleej Times put the same point in its headline: apartment prices could fall further as supply rises.
The reasoning concerns timing. In the agency's base case, the new homes arrive while the regional disruptions continue, and it is on that assumption that it says deliveries could accelerate the correction.
Related readSingapore's St Regis Residences owners fund a S$12 million upgradeThe agency draws a line between kinds of property rather than describing one market. It singles out apartments, and within apartments the segments bought mainly as investments. The press summaries name no districts and no price brackets, and they give no figure for how far S&P thinks those segments could fall.
Prices and sales since the war began
S&P's reading of the past seven months is that the damage has been limited so far. Zawya reports the agency's view that Dubai residential prices have fallen only moderately since the war began, and that the correction is concentrated in specific segments rather than spread across the whole market. Khaleej Times relays the same observation: some segments are already correcting.
The National attaches numbers to that. It reports that S&P, relying on industry reports, puts price declines at between 5% and 15% from the end of 2025 to September 2026. The range is wide, and it is second-hand: the agency is citing what market reports show, not a measurement of its own.
Activity has dropped more clearly than prices. Citing Dubai Land Department data, S&P counts an average of 12,644 sales a month from March to September 2026, against 17,198 a month in January and February, The National reports. The agency gives the fall as 26%. In plain numbers, that is 4,554 fewer sales in an average month than at the start of the year.
Deals down by about a quarter and prices down by 5% to 15% in places: sales have reacted faster than values. That fits the agency's choice of words for what comes next. According to The National, it expects prices to correct gradually, and does not expect a rapid decline.
Related readSouth Australia's short-stay register: consultation closes 30 OctoberTwo paths for 2027
The document does not give a single outcome. It sets a base case and then says what would change if the base case proved wrong, and the two are best read side by side.
| Scenario | Assumption | What S&P says could follow |
|---|---|---|
| Base case | Regional disruptions continue into 2027. | Deliveries in 2027 and 2028 could accelerate the correction, mostly in investor-driven apartments. |
| Alternative | Geopolitical risk subsides in 2027. | Fundamentals and the regulatory framework could stabilise prices despite the added supply. |
S&P Global Ratings Credit FAQ, as summarised by Zawya on 8 October 2026.
The supply is the same in both rows. What differs is demand, and S&P ties demand to the course of the war. In its alternative, the agency says Dubai's fundamentals and its regulatory framework could hold prices steady even with a fifth more homes.
Both rows use the word "could". Neither is a promise, and the agency does not attach a probability to either in the summaries published so far. The base case is simply the assumption S&P has chosen to work from when it assesses the companies it rates.
Why the falls have been limited
S&P also explains why seven months of war have not produced a sharper drop. Zawya reports that the agency attributes the limited declines partly to the United Arab Emirates' visa reforms, which it says raised the share of long-term investors and of end users, meaning people who buy a home to live in it.
The logic is about who holds the properties. An owner who lives in a home, or who bought it to keep for years, has less reason to sell into a weak market than a buyer who planned to resell quickly. The more of the first kind there are, the fewer homes come up for sale when sentiment turns.
Khaleej Times lists the supports S&P cites in similar terms: long-term property buyers, regulatory enhancements and government support. It adds one specific rule. Mortgages on off-plan homes are capped at a loan-to-value ratio of 50%, so a buyer who borrows must still pay at least half the price up front.
Related readUS home flippers' typical margin slips to 21.5% in second quarterS&P cites that cap as a buffer, according to Khaleej Times. The arithmetic is simple. When the buyer's own money covers half the price, a fall in value is absorbed by that half before it touches the amount lent.
Developers and banks
The document also concerns companies. Khaleej Times names the Dubai developers S&P rates as Damac, Emaar, Omniyat and Sobha Realty.
For these four, Zawya reports that the Credit FAQ addresses their credit ratings, the risk of buyers falling behind on payments, the risk of construction delays, their funding and liquidity, and what the agency expects them to spend on projects and pay out in dividends. The summaries give no figures on any of these points, and they do not report any change to a rating.
The link between the housing market and a developer's finances runs through off-plan sales. A home sold before completion is paid for over time. If buyers pay late, or if building falls behind, the developer has less cash coming in than it planned for. That is why delinquencies and delays appear on S&P's list next to funding and liquidity.
Banks come last. Zawya reports that the document examines how exposed Dubai's banks would be if the correction accelerated. Again the summaries stop at the subject and give no number. The 50% cap on off-plan mortgages reported by Khaleej Times is the one concrete element in the published accounts that bears on that question.
A base case is an assumption, not a prediction of the war
S&P assumes the regional disruptions last into 2027 and builds its analysis on that. The agency itself says a calmer 2027 could stabilise prices. Its figures are its own view, and the press accounts do not give every number in the document.
What an investor can take from it
Three things in the published accounts are firm enough to use, each with its limit.
Related readUS large investors bought 2.2% of single-family homes in AugustThe first is the pipeline. A 20% rise in the housing stock over two years is S&P's expectation, and the agency's own attention to construction delays is a reminder that deliveries can slip. It is still the one element that appears unchanged in both of the agency's scenarios.
The second is the split inside the market. S&P does not say Dubai homes will fall in price. It says specific segments are already correcting, that investor-driven apartments are the most exposed to new supply, and that the correction it expects is a gradual one. The agency's summaries carry no comparable warning for other kinds of home.
The third is the condition. S&P's outlook for prices depends on an event nobody in the property market controls. The same document that warns of a faster correction also says prices could stabilise if geopolitical risk eases in 2027.
What the accounts do not contain matters as much. They give no price forecast in figures, no list of districts, no rental outlook and no numbers on developers' debts or banks' loan books. Anyone weighing a decision on the strength of the document would need those answers from the document itself. How any of it applies to one property depends on the home, its price and the way it was financed.
The dates in the analysis are the delivery years, 2027 and 2028, and the two-year period over which S&P expects the housing stock to grow by a fifth. The published summaries announce no follow-up report and no scheduled review of the four developers' ratings.
The supply side of S&P's view is a number. The demand side is a war, and the agency gives two answers because it does not know which way that goes.
Kooky, from Shaka
Kooky edits Agents Estate and builds Shaka, the payment router he made for real estate professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.
