Two in One: Dubai and Jūrmala

For several years now, VIP Real has been operating in two real estate markets: Jūrmala and Dubai. Both are currently navigating geopolitical instability. Nevertheless, both markets are demonstrating resilience, albeit in different ways. Lara Batova, co-owner of VIP Real, spoke to m2 magazine and the varianti.lv portal about how government and business measures are helping Dubai’s real estate market remain attractive amid tensions surrounding the conflict in the Persian Gulf, and about how property sales are progressing in Jūrmala.

About Dubai

— For the fifth year running, Latvia’s real estate market has been operating against the backdrop of geopolitical risks associated with Russia’s invasion of Ukraine. Dubai, like the United Arab Emirates (UAE) as a whole, was long regarded as a haven of peace and one of the world’s most attractive real estate markets. But on 28 February 2026, a new phase of confrontation began between the United States and Israel on one side and Iran on the other. Dubai suddenly found itself close to the front line, with its territory even subjected to missile and drone strikes. What impact has this had on Dubai’s real estate market? we asked Lara Batova when we met. She spent the summer in Latvia before returning to the UAE with her family at the end of August.

— When the military conflict began in the Persian Gulf and Iran launched missile and drone strikes on Dubai and Abu Dhabi in March, we were, of course, shocked. Our family spent the entire month of March in Oman, which was considerably calmer. Naturally, market activity in Dubai declined against the backdrop of the conflict with Iran, and many clients put their plans on hold. Our company had six transactions in progress, and not one was completed that spring. This is entirely understandable: people were frightened by the uncertainty. Yet the quiet period did not last very long. Gradually, it became clear that the UAE faced no immediate military threat. Major groups of Dubai property buyers from countries such as India, China and Pakistan remained active. As a result, nearly 14,000 property purchase transactions were registered in Dubai in June and July 2026, a figure comparable to, or even exceeding, the results recorded in four of the twelve months of 2024. In other words, we saw the level of activity that the market had demonstrated a couple of years earlier.

Another significant figure: almost 200,000 people arrived in the UAE last year. In March, when the war began, approximately 60,000 people left. Since late spring, this trend has reversed, and experts forecast that the Emirates could welcome an inflow of around 155,000 people in 2026. Given the geopolitical situation, you will agree that this is not a bad result.

— I have read that Iranians have been among the significant players in Dubai’s real estate market since the early 2000s.

— That is true. Nobody provides an exact official figure, but online estimates put the value of Iranian investments in Dubai at more than USD 500 billion. In March, following individual Iranian missile and drone strikes on UAE territory, the Emirati authorities announced a freeze on all Iranian assets and a ban on Iranian citizens conducting real estate transactions. From a market perspective, this was the right step, limiting the potential number of distressed assets. At present, Iran’s aggressive rhetoric directed at the UAE has almost completely subsided.

— You mentioned distressed assets. Have any appeared? Have prices started to fall?

— Official statistics show that there was one month in spring when average prices fell by approximately 6%. What is happening in Dubai’s real estate market cannot by any means be described as a price collapse. There is a price correction taking place this year; that is a fact nobody disputes. Undoubtedly, some people panicked in March and reduced their asking prices, but the Emirati property market retained its inertia, and the overall pricing situation did not fundamentally change. Real estate is not a cryptocurrency with sudden surges and plunges. Of course, there are cases involving discounts of 20%, but most of these concern illiquid or overpriced properties in particularly undesirable locations, or properties whose owners previously bought at inflated prices following advice from unprofessional brokers. Such properties were difficult to sell even in 2025, when market conditions were favourable, and in 2026 they have become virtually impossible to sell. This new reality is forcing owners who genuinely want to complete a sale to come down to earth and consider realistic offers from potential buyers.

If you look at Dubai’s most popular property websites, such as propertyfinder.ae, you will not see any massive sell-off. Attractive discounted properties are often marketed in closed professional chats rather than advertised publicly. Many brokers maintain lists of clients interested in buying distressed properties. When such properties appear in good developments or locations at below-average market prices, they quickly find new owners. Here are a couple of striking examples. First, an apartment in a skyscraper was listed a year ago for AED 22 million (EUR 5.2 million). In the spring, it was offered for AED 18 million and ultimately sold for AED 14 million (EUR 3.3 million). We also had a client interested in that property, but things move very quickly in Dubai and we simply did not make it in time.

In another case, premium-class apartments had been offered for AED 67 million (EUR 15.5 million) until the beginning of this year; the owner had wanted to sell them for a long time. With the onset of the geopolitical events, that desire grew stronger. As soon as the owner agreed to consider offers from potential buyers, the transaction was completed for AED 50 million (EUR 11.8 million).

Those who have worked in real estate for a long time understand that market turbulence offers an excellent opportunity to acquire promising property at a lower price, with the expectation that it will recover its value in a few years. We saw many such cases in Latvia during periods of market turbulence. The same principle applies in Dubai.

— The examples you mentioned concern the secondary market. How did developers respond to the military conflict and the departure of residents in March?

— Everything that was under construction in Dubai at the end of winter continued without a moment’s interruption: not a single crane or construction site stopped. However, developers slowed the launch of new projects where construction had not yet begun.

Large developers with substantial financial resources do not even consider discounts their main tool for influencing the market. They are waiting out the period of tension, understanding that a crisis does not last forever. What they are willing to offer is more favourable payment terms. A common arrangement in Dubai is for 80% of an apartment’s price to be paid during construction, with the remaining 20% due immediately upon completion. This year, responding to buyers’ demands, many developers have changed the proportions to 50/50 or 40/60. Some have even agreed to accept the final 20% over the course of a year after construction is completed.

— Nevertheless, which segments of Dubai’s property market do you think have suffered the most this year?

— First of all, short-term rental properties. They were geared towards tourist flows, which have declined sharply since March.

The second segment is apartments on the upper floors of skyscrapers, for which demand has fallen significantly. This is connected to the drone strikes. Buyers now prefer lower floors rather than upper ones, because in an emergency they can evacuate more quickly and safely. We ourselves live in a townhouse complex, in a terraced-house unit. At one point, townhouse prices actually rose because of increased demand.

Another point is that people are prepared to compromise on location: instead of central Dubai, they choose more distant districts, including areas outside the city, where buildings are less concentrated. Commercial property prices fell sharply in spring as small businesses closed when their owners left the country. That same segment is now showing the strongest growth, recovering its lost ground, helped by new government conditions favourable to entrepreneurship. This autumn will be revealing, when expatriates who spent the summer in their home countries return to the Emirates as the summer heat subsides. Among the people we communicate with, the overwhelming majority are returning. At the same time, I can see that it has become easier to enrol children in prestigious, highly sought-after schools than it was a year or two ago. The situation in the Emirates is also calm. Our AG VIP REAL Estate office in Dubai is operating as usual.

— Can we say that confidence in Dubai’s market is returning?

— I would say that fear is fading. Every crisis ends eventually, and every crisis creates opportunities. Once the market has fully stabilised — which requires the hostilities surrounding Iran to end — price trends will turn positive again. Dubai developers are already saying that the cost of projects entering the market in two or three years will definitely be higher because of rising energy and construction-material costs. And this process will most likely be irreversible. Dubai’s authorities are making every effort to attract new buyers and affluent foreigners to the country. They also look after their own people and compete for every transaction and every visitor. Legislative amendments are being adopted to simplify the process of obtaining the so-called Golden Visa for investors, and new incentives for starting businesses are being prepared. A programme called “Invite a Foreigner” has now been launched. Under this programme, when someone visits a local resident, the host receives a cash bonus from the state. The authorities want as many people as possible from around the world to want to visit the UAE again and, after their visit, tell others that it remains peaceful and safe and that development continues.

People have been given comprehensive support. One telling example concerns a broker I know. He rented a one-bedroom apartment for AED 6,800 (EUR 1,700) a month. In spring, he fell behind on his rent. The owner filed a claim with a special department that handles disputes between residential landlords and tenants. The department called the broker and asked about the debt. He explained the difficult situation in the property market. They asked how much he could pay, and he replied AED 5,000 (EUR 1,250). This information was passed on to the owner, who agreed to reduce the rent temporarily. That is what I call a socially responsible approach. The same attitude can be seen in many areas. Living in the UAE, you feel protected. Our company, AG VIP REAL Estate, also experienced this support from the state.

Our business licence normally costs AED 25,000 (EUR 6,000) per year, but in view of the market situation our licence fee was reduced to AED 17,000 (EUR 4,250). We were told that the amount would be recalculated when business improved. Such care and understanding are very welcome.

About Jūrmala

— Let us turn to Latvia, which is close to your heart, and specifically to Jūrmala. What are your impressions of Jūrmala’s real estate market? How did business go over the past summer?

— Judging by transaction statistics, the past summer, and indeed the year as a whole, differed little from 2025. To my surprise, there were quite a few property purchases during the summer itself. Buyer activity is usually highest in spring and autumn. Despite the geopolitical challenges, Latvia’s leading resort property market has not only maintained its position but has also shown growing interest in certain types of properties. It should be noted, however, that the average transaction value has fallen noticeably. There are very few expensive purchases. In the first half of 2026, there was not a single apartment transaction in Jūrmala above EUR 1 million, and only five transactions exceeded EUR 500,000. Admittedly, the situation in this segment may change over the next eighteen months to two years, as three premium residential developments are currently under construction: Noble Residence, Nine Pines and August. According to the developers, homes in these projects are being reserved quite actively. We will have to wait until the developments are completed. Overall, the statistics for transactions involving various types of Jūrmala property priced above EUR 500,000 over the past five years are as follows: 42 transactions in 2021, 38 in 2022, 45 in 2023, 50 in 2024 and 42 in 2025, with 18 transactions in the first half of 2026. The premium segment accounts for just over 2% of all transactions in the resort market this year. It is an interesting segment to discuss, but it is not a mass-market product and does not reflect overall market trends. In my view, the high-end segment will continue to face a shortage of buyers, and this will be a long-term trend that all market participants will have to take into account. The reason is that demand for resort properties in Latvia in recent years has largely come from local clients, whose purchasing power is lower than that of foreign buyers and whose transaction budgets are therefore more modest.

Leaving aside standard-series apartments, most buyer activity this year for apartments in new developments and in the central part of the resort has been concentrated in the EUR 150,000–350,000 range, while private-house transactions have been in the EUR 350,000–600,000 range. For this money, buyers want a property closer to the sea and, preferably, a relatively new one. There are not many such properties on the market. When one does become available, it is often not advertised on the open market at all but sold directly, without publicity, to a client who has already approached us with a request and is ready to buy at that moment. Local buyers who have long wanted to purchase a second home in Jūrmala respond actively to special price offers. Paradoxically, Latvia’s leading resort has a severe shortage of new properties priced below EUR 250,000. We constantly receive enquiries for new-build properties within this budget.

The summer rental market performed well this year. Properties left without tenants were either old or unrealistically priced. Fresh, modern properties were snapped up quickly, almost immediately. Newer properties could even command higher rents, provided those rents remained reasonable. By contrast, keeping asking rents high for older properties is not a promising strategy.

— So the problem of overpriced properties in Jūrmala remains relevant?

— Absolutely! Many owners of private houses and apartments built 15–20 years ago still cling to prices from that period, believing that their property is the best in the world. Based on actual local demand, a substantial proportion of Jūrmala’s private houses and apartments in older new-build developments are overpriced by approximately 15–20%. As long as their owners insist on their current positions, they are unlikely to complete a sale. We feel the demand rather than simply browsing property listings. We see reality in all its forms. For example, the farther a district is from central Jūrmala, the weaker the demand and the further asking prices tend to be from reality. Interest in prime locations is stronger. Sellers need to understand and accept this: to sell a property, they must be prepared to compromise.

In closing, I want to say that Jūrmala is a resort town with clean air and truly beautiful nature, and it will always thrive! Jūrmala is our city!