Wealthy buyers from around the world continued to snap up Dubai luxury homes during the third quarter, according to researcher Knight Frank, although sales volumes declined about 17% from last year as the Iran war dragged on.
Wealthy buyers from around the world continued to snap up Dubai luxury homes during the third quarter, according to researcher Knight Frank, although sales volumes declined about 17% from last year as the Iran war dragged on.
Dubai recorded 86 sales of homes priced at $10 million or more during the quarter, according to Knight Frank. That compares with 103 sales in this price bracket during the same period last year. Luxury property sales were at a record in Dubai in 2025.
Despite the pullback, the numbers illustrate the relative resilience of property demand in a city that faced a barrage of Iranian missiles and drones earlier this year. While most of the projectiles were intercepted, sectors like tourism, aviation and trade have come under pressure. House prices have also dropped marginally, with the property firm JLL estimating that values have fallen about 5% on average with some prime neighborhoods recording bigger declines.
Between January and September this year, Dubai recorded 412 home transactions valued at more than $10 million, not far from the record 500 sales for all of last year, according to the Knight Frank report.
“Despite the exceptional geopolitical backdrop across the region, Dubai’s luxury homes market has continued to record high volumes of sales during the third quarter, albeit these are lower than this time last year,” said Faisal Durrani, head of research for Middle East and North Africa at Knight Frank. “The somewhat ‘stop-start’ nature of the hostilities is predictably a confidence dampener,” Durrani said of the regional conflict.
The Iran war has capped Dubai’s longest property boom, which began during the pandemic in 2020. Still, in September most of the city’s expat residents returned after the summer break, helping shore up the market.
In the third quarter, 13 properties sold for at least $25 million with a total value of about $500 million.
The artificial Palm Jumeirah island and Emirates Hills accounted for most of the city’s sales. Total sales of properties worth $10 million or more reached about $6.7 billion for the first nine months. In the third quarter of 2024, there were 83 sales in that bracket.
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The falling prices in prime neighborhood like Palm Jumeirah, which Knight Frank estimates dropped 9% in the past 12 months, may have driven new buyers into the market.
“The island is increasingly offering ‘good value’ at 4,083 dirhams per square foot,” said Louis Harding, head of UAE residential at Knight Frank. “Buyer interest here continues to largely stem from those seeking a permanent or holiday home, rather than buy-to-flip investors,” he said.
The slowdown comes on the heels of a record-setting year in 2025. Overall prices in the city rose more than 70% after the pandemic, analysts have estimated.
“The biggest drag at the moment on overall market activity is the ongoing regional conflict,” Durrani said.
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