UAE property buyers soften price-drop expectations as sellers hold firm
Rental activity rebounds as market participants reassess property values
DUBAI – The gap between what UAE property buyers expect to pay and what sellers are willing to accept continued to narrow in May 2026, according to the latest analysis from Property Finder.
The proportion of buyers expecting property prices to decline fell to 63%, marking a second consecutive monthly drop from the peak of more than 70% recorded after the onset of the conflict. Meanwhile, sellers have largely maintained their advertised prices, with asking rates remaining close to pre-conflict levels.
The shift highlights a gradual adjustment in market sentiment, as buyers move away from expecting major discounts while sellers continue to show confidence in property values. Rather than a sharp correction, the market is seeing both sides move towards more realistic expectations, with pricing discussions becoming a key factor in transaction decisions.
Before the conflict, buyer sentiment was more evenly divided. Property Finder’s January–February 2026 consumer sentiment poll showed that 36% of buyers expected prices to decline, 35% anticipated growth, and 29% believed prices would remain stable. At the time, the market reflected mixed expectations, with many buyers viewing property prices as high but uncertain about the direction ahead.
Following the start of the conflict, sentiment shifted significantly, with a larger share of buyers anticipating lower prices and delaying decisions in expectation of better deals. However, this outlook has gradually eased each month, reaching 63% in May as market participants adjust to changing conditions.
Pricing gap
While buyers have moderated their expectations, sellers have remained comparatively steady. Property Finder’s proprietary listing price index showed advertised asking prices were approximately 2% below pre-conflict levels in May, compared with around 1% below in April.
The limited movement from sellers indicates that owners have generally resisted aggressive price reductions, particularly for properties positioned in strong locations or those priced in line with market conditions. As a result, the distance between buyer expectations and seller asking prices is narrowing gradually rather than through sudden price changes.
Property Finder described this phase as a period of price discovery, where buyers and sellers gradually align on the value of homes through negotiations and market activity.
“When buyers and sellers sit far apart on price, deals take a pause, and that distance is exactly what's narrowing now,” said Cherif Sleiman, Chief Revenue Officer at Property Finder. “What matters is how it’s narrowing: through expectations settling, not through panic on either side. A market where more people expect prices to hold is steadier ground than one swinging between fear and optimism, and that steadiness usually has to come first.”
He added that buyers and sellers typically close the pricing gap before transaction volumes begin to recover, making behavioural shifts an important indicator of market direction.
Demand has not disappeared but has instead shifted towards renting, as some buyers continue to wait for greater clarity on pricing. The volume of new rental contracts signed in May was only 20% below pre-conflict levels, improving significantly from 32% below in March.
Rental shift
The rental market has also seen stronger movement from people relocating into new homes rather than simply renewing existing agreements. In May, nearly half of all rental activity involved tenants moving into new properties, with the share rising to 47% from 41% in March.
The increase suggests that many residents are actively making housing decisions while buyers and sellers continue to negotiate expectations. The recovery in new rental contracts also reflects ongoing demand from households choosing flexibility while monitoring purchase opportunities.
Alessia Sheglova, CEO of Dacha Real Estate, said the current market reflects a more strategic approach from both sides. She noted that buyers are negotiating more carefully and relying heavily on market data, while also recognising that well-priced and desirable properties are not experiencing significant discounts.
“Sellers, on the other hand, are still holding relatively firm, especially where the property is in a strong location or priced sensibly,” Sheglova said. “The gap is closing, but it is closing through more realistic expectations rather than a sharp correction.”
She added that accurate pricing, transparent advice and expectation management are becoming increasingly important for brokers as buyers and sellers work towards agreements.
Market recovery
Sam McCone, Managing Partner of McCone Properties, said activity on the ground shows the gap between buyers and sellers is narrowing. He noted that immediately after the conflict began, some buyers approached sellers with significantly lower offers, expecting widespread discounts.
However, he said that approach has gradually declined as buyers recognise that securing a good deal does not necessarily mean purchasing at a heavily reduced price. Sellers who price their properties realistically are continuing to complete transactions, while previously delayed deals are beginning to move forward as both sides reach a better understanding of market value.
Property Finder will continue monitoring buyer and seller expectations as an indicator of how the UAE property market evolves, alongside wider transaction trends and rental activity.