Dubai residential rents fell 6.2% between the first and second quarters of 2026, according to CBRE Middle East's UAE real estate market review. Home sale prices were still 1.9% higher than a year earlier. Tenants saw the relief. Buyers did not get the same cut.
The annual rent change was a smaller 2.6% decline. Most of the softening happened inside that one quarter, after several years of steady increases. Around 18,000 new homes were completed in Dubai in the first half of 2026. CBRE tied part of the rental ease to that extra stock.
Sales cooled faster than prices
Fewer than 37,000 residential transactions were recorded in the second quarter, down 29% from more than 51,000 in the same period of 2025. The value of those deals fell from nearly 154 billion dirhams to Dh88 billion. CBRE pointed to softer demand, fewer new launches, and the extra supply.
A separate UBP note, reported by Khaleej Times, looked at December 2025 to May 2026 rather than the CBRE quarter. Transaction values were down 55% in that window. Delivered-home deals fell 49% and off-plan deals fell 58%. UBP said price per square metre was down about 10% year to date, with delivered homes off only 2.4% and off-plan down 10.8%. June showed a modest rebound.
The two reports do not contradict each other so much as measure different stretches. CBRE's year-on-year sale-price figure is still up. UBP's year-to-date figure is slightly down. Both describe a quieter market, not a collapse in asking prices.
New leases eased; many renewals did not
UBP said rents on new contracts across Dubai had eased 4.8% since a February 2026 peak. Renewal contracts, which sit under rules that cap increases when a tenant is near the market average, were up 3.1%. Existing tenants on a renewal were not seeing the same drop as someone signing a fresh lease.
That is the practical split for residents. If you are renewing in a building that is already close to the rental index, do not assume the 6.2% quarterly figure lands on your contract. If you are signing new, you have more room to compare buildings that competed with the first-half completions.
Offices and shops did not follow rents down
Dubai office rents rose 13% in the year to the end of the second quarter. Prime offices were up 16%. Occupancy was about 94%. Demand stayed concentrated in DIFC, TECOM, and DMCC, including space leased before it was finished. Abu Dhabi office rents were up nearly 16%, with occupancy around 96%, strongest in Abu Dhabi Global Market.
Retail occupancy stayed high: about 98% in Dubai and 95% in Abu Dhabi. Dubai retail rents were up around 3%. Industrial and logistics space kept drawing demand in Dubai Industrial City, Dubai Investments Park, and National Industries Park.
Abu Dhabi's housing market moved the other way from Dubai's rental ease. CBRE put residential values there up 21.6% year on year, with apartment prices up 24.4% and rents still 3.6% higher annually. Sales reached Dh32 billion, up 150% from the second quarter of 2025. Off-plan homes were about 83% of those deals.
Matthew Green, head of research at CBRE MENA, said the second quarter marked a shift as regional developments weighed on activity, tourism, and sentiment. "Although near-term conditions are likely to remain challenging, the country's long-term growth trajectory remains supported by structural reforms, strategic investment and its position as a leading hub for trade, capital and talent," he said.
For anyone deciding this month: tenants shopping a new lease have more choice than they did a year ago. Buyers are still paying more than in 2025, even with fewer people closing.
💬 Are you seeing that 6.2% ease on a new lease, or only in the headlines?