Dubai: More end-users are entering into Dubai’s property market, with mortgage-backed transactions now making up 40% of all residential purchases. This calculation means two times of mortgage volumes in the first half of this year compared with the second half of 2020.
This figure also suggests that end-users are keen to step into the market now rather than taking the risk of waiting in the hope that property values could drop. The higher number of mortgages also attest to the buyers’ interest in ready homes rather than off-plan, as per the consultancy Mortgage Finder.
The average home loan amount is also up, by 24% from second-half 2020 to the present date. The average home loan size in the initial half-year is Dh2.2 million. There is an “almost 50:50 split in mortgage transactions for villa/townhouses and apartments,” the report finds. (In overall sales, apartment deals made up 725 percent of the first-half total.)
Home loan rates are available from 1.99%, comparing with 2.49% in the middle of 2020.
“We have seen a significant uptick in demand this year, which is really positive news and indicates more people are reaching the goal of owning their own home in Dubai,” said Ian Vaughan, Senior Mortgage Consultant at Mortgage Finder. “The increase in activity in the market can definitely be attributed, in part, to the major reform in lending policy introduced by the Central bank of the UAE in early 2020, which allowed banks to lend 5 percent more, reducing the down payment requirement for first-time buyers from 25 percent to 20 percent. This has made getting a mortgage more accessible for some.”