Lifestyle
Supply and Demand: Finding the Balance in 2026
February 2, 2026
The global financial crisis is now being felt directly by Dubai's developers. Sales have slowed sharply, financing is scarce and some projects in early stages are being reviewed. Discussions about consolidation, including possible mergers among government-linked developers, have begun. For buyers of homes still under construction, these developments raise urgent questions.
Why developers are under pressure
- Falling sales: buyers have paused purchases, reducing cash flow.
- Funding gaps: loans and bond markets are difficult to access.
- Construction costs: ongoing commitments to contractors continue.
- Buyer defaults: some buyers are unable or unwilling to pay instalments.
Possible responses
Developers may slow construction, delay or cancel projects in early stages, merge with stronger partners or seek support from shareholders. Consolidation among government-linked developers could create larger, more stable entities.
What buyers should do
- Check whether your project is registered with RERA and has an escrow account.
- Monitor construction progress and keep records of all payments.
- Communicate with the developer in writing about timelines.
- Take legal advice before stopping payments.
The importance of escrow
Escrow accounts, required for projects registered since last year, are designed to protect buyers' payments for specific projects. They will be tested in this environment, and buyers should confirm their status.
Strong developers versus weak
Developers with strong shareholders, completed projects and diversified income are better positioned to continue construction. Buyers of projects by smaller, less established developers face higher risk.
Our view
Consolidation and project reviews are painful but may ultimately strengthen the market. We are helping clients assess the status of their projects and their options, with a focus on protecting their interests.
