Indian Capital In Dubai May Flow Back Home Temporarily, Says Anarock's Aayush Puri

For decades, Dubai has enjoyed the “safe haven” status as the Gulf nation became a preferred land for global investors, especially Indians. In 2025, Indians were the largest group of foreign buyers in Dubai’s residential property market. They purchased homes worth an estimated ₹85,000 crore to ₹95,000 crore, according to Anarock Property Consultants data. 

However, Iran war-driven volatility rattled oil, currencies and investors’ confidence. “In periods of global uncertainty, investors tend to revalue familiarity,” said Aayush Puri, Managing Director, Anarock. He points to an early shift that can be more consequential than Dubai’s recent dip in property sales. 

Property sales in Dubai have come down by 44% year-on-year since February end across the emirate’s home, villa, office and commercial markets, the data from Dubai Land Department revealed. Despite the slowdown, Puri remains confident that Indian investment into Dubai is not going to “disappear” because of one conflict. 

“...it can slow. It can become more selective. It can shift from aggressive deployment to cautious deployment. That is because cross-border real estate is ultimately a confidence trade. When war dominates the headlines, people delay decisions,” says Puri. 

He asserts that Indians may not abandon Dubai, but they start asking questions like whether they should invest now or wait a quarter, whether they preserve liquidity, or whether they can put more money back into India instead due to hesitation. 

While calling this hesitation the “immediate impact of clash between Iran and the US-Israel, Puri says the bigger structural impact still sits with India’s own macro health. 

Capital May Turn Homeward Temporarily

India, Puri believes, appears a relatively stronger market during the times of global uncertainty because it is better understood. “Investors (Indians) are aware of cities, demand patterns, consumer base, local business networks and legal framework which makes it easier to assess and commit capital”. 

According to him, a chunk of Indian capital that may have gone abroad could come back home “temporarily”. This is not because Dubai’s long-term growth story is broken, but because rising uncertainty in the Gulf is making domestic investment relatively more attractive. 

He adds that when the rupee comes under pressure and overseas assets become costlier in local terms, the case for investing within India becomes even more compelling. Hence, Puri suggests Indians to stop reacting emotionally to headlines.  

“This is a moment for discipline. If your investment thesis only works when oil is cheap, liquidity is easy and sentiment is euphoric, then it was never a robust thesis to begin with. Second, quality matters more now. Whether you are looking at India or Dubai, strong assets, strong balance sheets and holding power become critical in a volatile cycle”.

Third, Anarock MD recommends that India should not treat this as a one-off scare. This war is a reminder that energy security is economic security. If conflict in the Gulf can slow private-sector activity in India within weeks, then Puri says  the country has to keep building resilience in fuel supply, logistics and pricing transmission.  

India First, Not Dubai

While Dubai is the visible conversation, Puri says the real economic story belongs to India. The reason is simple: India remains deeply exposed to Gulf energy routes. Reuters reported this week that about 40% of India’s crude imports move through the Strait of Hormuz. 

He points out that external crises in the Gulf tend to transmit into India first through oil, inflation, currency pressure and household confidence — not through overseas real estate sentiment. 

This divergence, he says, is already visible in macroeconomic signals at home. India’s private-sector growth has already slipped to a more than three-year low in March, while New Delhi has moved to strengthen gas infrastructure as supply risks rise.  

However, Puri says India is much stronger today than it was during earlier commodity shocks. Domestic demand is deeper, policy response is faster, capital markets are more mature, and there is greater strategic flexibility in sourcing energy.

Safe-Haven Under Test

While India absorbs the first-order macro pressure, early signs of strain are also emerging in Dubai’s property cycle. Bloomberg reported that residential prices in Dubai have slipped for the first time after a post-pandemic boom, falling around 5-6%. 

However, overall sales volumes have also cooled sharply from peak levels. This comes even after the emirate recorded nearly $250 billion (₹23 lakh crore) in total real estate transactions last year. 

Dubai’s recent wobble in property sentiment shows how quickly its long-touted safe-haven appeal can come under pressure when geopolitical risk escalates. After a post-pandemic surge that pushed home prices up more than 70% since 2020, the emirate’s real estate market is now seeing its first meaningful correction phase. 

Yet, even this slowdown comes after an exceptionally strong cycle, with Dubai still recording around $250 billion in property transactions last year, underlining its deep liquidity and global investor base.

Still, the current phase marks a shift in narrative. The one-way confidence trade into Dubai is now becoming more selective, as investors reassess risk, liquidity, and geopolitical exposure.

As Puri says, the bigger story is not just about Dubai losing steam, it is about how uncertainty is forcing capital to rethink where safety truly lies in a more volatile global order.