Citi cut Dubai's population growth forecast from 4% to 1% in 2026. 145,800 units are still being delivered this year.

Between 2020 and 2023, Dubai experienced a massive construction boom. Those projects are now reaching completion — all at the same time. 120,800 units are due for delivery in 2026, compared to a historical average of 27,000 units per year. More than five times the usual pace. 

And the pipeline isn't slowing down. Dubai Municipality issued 10,776 building permits in Q1 2026 — up 12% year-on-year. Total permitted built-up area reached 3.9 million square metres, up 48% year-on-year. 

For years, strong population growth allowed the market to digest new supply without disruption. Today, the equation looks different. If fewer residents arrive while a record number of units enter the market, pressure will appear first in rents, then in capital values.

The UAE authorities are already responding. Recent adjustments to the Golden Visa framework are designed to facilitate long-term residency for international investors, while the broader strategy continues to attract talent and capital. 

If tensions ease, the correction stays limited to mid-single digits on rents. If they don't, Fitch's base case of up to 15% correction becomes realistic — with a recovery taking 3 to 4 years based on previous Dubai cycles.