Dubai GDP growth to power realty boom

Inayat-ur-Rahman, Business Editor

DUBAI: Dubai’s residential property market is set to reach new highs in 2026, supported by strong GDP growth and powerful structural economic drivers, according to a new market analysis released on Wednesday by Juwai IQI Co-Founder and Group CEO Kashif Ansari.

Despite widespread predictions earlier this year that Dubai’s housing market would face a downturn in 2026, the opposite is unfolding. “Many analysts warned that Dubai was entering a bubble phase,” said Ansari. “Instead, the feared bust has turned into a boom, and prices and rents are being lifted by genuine economic expansion rather than speculation.” Dubai’s GDP is estimated at approximately Dhs 565 billion in 2025, growing at an annual rate of about 4–5%. Forecasts from banks and government-linked institutions indicate that this pace of growth is likely to continue into 2026, pushing GDP toward Dhs 590–600 billion. Finance, real estate, trade, and advanced services remain the key contributors, with new sectors adding momentum.

One of the most important growth drivers is Dubai’s rapidly expanding financial sector. The number of hedge funds operating in Dubai has doubled since early 2024, reflecting the city’s appeal as a global financial hub. Dubai’s tax-free income environment, strategic time zone, and access to more than $1 trillion in assets held by local family offices continue to attract capital and highly paid professionals, directly supporting housing demand.

Another major catalyst is the rise of artificial intelligence. Dubai is emerging as a significant AI hub within the UAE, benefiting from massive global investment in data centers and digital infrastructure. The UAE’s AI economy is projected to be worth around $96 billion and account for 14% of GDP by 2030, creating approximately 200,000 jobs. A substantial share of this growth is expected to be concentrated in Dubai, generating long-term demand for residential property.