The lengthy post-handover payment terms are being reinstated by Dubai developers; recent off-plan launches even included “7.5-year” clauses. The goal is to allay buyers’ concerns about rising mortgage rates, especially since there will be at least a couple more increases later this year.
Another well-liked payment schedule—which Danube Properties had pioneered—is currently making the rounds off-plan. With terms up to 99 months, this is the 1% monthly installment. It’s noteworthy that many of these launches fall into the affordable category, with entry-level prices of Dh500,000 or more and a two-bedroom costing between Dh1.5 million and Dh2 million, depending on the location and the developer’s numerous value-adds.
“Dubai property needs both cash buyers and end—users with mortgage plans,” said a developer. “Bringing back longer post-handover plans was a no-brainer. Otherwise, the market risks losing potential buyers because they will be fixated on the mortgage rates.
“The 1 percent a month offer gives them the flexibility to plan their budgets better, and in many cases, without involving a bank at all.”
These developers have seen that recent launches that were priced below Dh2 million hit the investor sweet spot and are now becoming even more customer-friendly with their payment plans. And while previously buyers tended to be older, these launches were attracting first-time buyers into the Dubai property market, many of whom were in their late 20s and early 30s.
Still holding up
According to all appearances, Dubai real estate transactions remained active during the summer, although the decline in mortgage-backed transactions was also apparent. For salaried and frugal consumers, the previous two increases—at 0.75 percent each—will have been rather significant.
“As in the past, developers have to redouble their efforts to convince buyers that it’s still a good time to buy,” said an estate agent. “Because on this depends the fate of the upcoming off-plan launches.
“There will be a lot of extended post-handover plans at Dubai South projects, and also at Al Furjan and some of the other emerging areas in Dubailand.”
The Beachfront
There is also a new one starting to build a profile with investors – Emaar Beachfront. “Handovers have already started with residents taking up occupancy in some of the finished towers like Beach Vista,” said a spokesperson at Betterhomes, which is one of the listing partners on the portal houza.com. “However there are still many that are under construction with anticipated handovers between now and 2027.
“That said, it is still attracting very strong demand from buyers. Betterhomes Group is currently seeing launches sold out on the same day and sales on the secondary market achieving high premiums close to unit deliveries as many buyers see the potential of a fully ready project.”
Awaiting Expo City
One of the most eagerly awaited developments in the real estate industry is the new location that will occupy Dubai’s Expo site. While workers will begin using the renovated buildings at Expo City in October, details about the residential portion are still being worked out.
“Expo City will propel interest and investor demand across Dubai South – that’s a cert,” said a developer. “Because all the offices opening at Expo City from October will create staffing needs close by – and Dubai South will be the obvious answer.
“The action is only starting.”