Townhouses at Arabian Ranches II
Villa/townhouse properties accounted for 63 per cent of mortgage purchases amongst Mortgage Finder clients in Q3, 2021. Image Credit: Supplied

Dubai: The end of September spelled a record breaking year so far for the mortgage market in Dubai, as the total number of mortgage transactions registered year to date exceeded records for the same period over the past three years.

According to government data, Dubai had registered 68 per cent more mortgages than the same period in 2020 and 71 per cent more since 2019.

The previous quarter (Q3-2021) was a notably active period in the mortgage industry, as banks and other stakeholders involved in the mortgage process reopened for business allowing mortgage transactions that had been placed on hold during lockdown to proceed as normal again. Despite the post-lockdown spike in mortgage transactions experienced in Q3-2020, data from the government shows that Q3-2021 transactions have still exceeded this by 22 per cent.

This is so exciting to see as more buyers are getting onto the housing ladder. Now with Expo opening, we’re even more excited to see what happens as we enter the final quarter of the year.

- Warren Philliskirk, Director at Mortgage Finder
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According to data and trends from Mortgage Finder, those purchasing property for the first time in the UAE have been particularly active, making up 83 per cent of mortgage transactions. In 2020, the UAE Central Bank reduced the down payment requirement for first-time buyers in the UAE by 5 per cent, taking it to 20 per cent for non-UAE nationals and 15 per cent for nationals. It is positive to see first-time buyers take advantage of this down payment reduction and also of the record low-interest rate environment currently being experienced in the UAE.

Villas in high demand

Villa/townhouse properties accounted for 63 per cent of mortgage purchases, apartments made up 35 per cent and the remaining 2 per cent was attributed to land, commercial and other property types.

The most popular villa communities were Jumeirah Golf Estates, Arabian Ranches and The Springs.

Villas and townhouses have consistently been more popular over the past year, as they opt for bigger spaces with private gardens, pool areas and so on. This is a trend that has continued from 2020 following the lockdown.

As more buyers have entered the market this year the issue of supply in some prime communities has been widely documented, leading to property price increases, especially for villas/townhouses. Mortgage Finder has seen this increase in property prices translate into a 43 per cent jump on the average loan amount compared to September last year.