Dubai: Dubai developers are bringing back the longer post-handover payment terms, with recent offplan launches even offering ‘7.5-year’ provisions. The intention is to reduce buyers’ worries over higher mortgage rates, more so as there will be another couple of hikes at the very least later this year.
Another popular payment plan – and which Danube Properties had pioneered – is doing the offplan rounds. This is the 1 per cent monthly instalment, with tenors extending to 99 months. What’s interesting is that many of these launches are in the affordable space, with entry-level values of Dh500,000 plus and a two-bedroom coming to Dh1.5 million to Dh2 million, depending on the location and the various value-adds the developer plans to offer.
“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 with the mortgage rates.
“The 1 per cent a month offer gives them the flexibility to plan their budgets better, and in many cases, without involving a bank at all.”
These developers are also turning even more buyer-friendly on their payment plans because they have seen how recent launches hitting the investor sweet spot by being priced under Dh2 million. And these launches were bringing first-time buyers into Dubai property, many of whom were in the late 20’s/mid-30’s, while traditionally buyers tended to be older.
Still holding up
By all indications, Dubai property sales remained busy throughout summer, but what was equally noticeable was the dip in mortgage-backed sales. The last two increases – at 0.75 per cent each – will have been quite heavy for salaried and budget-conscious buyers.
“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 offplan 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.”
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
The new destination taking up Dubai’s Expo site remains one of the most anticipated in the property market. While people will start working from the re-purposed buildings at Expo City from October, details of the residential side of it is awaited.
“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.”