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Mortgage rates still remain favourable from a home buyer's perspective, with offered rates from 1.99%. Image Credit: Supplied

Dubai: More end-users are getting into Dubai’s property market, with mortgage-backed transactions now making up 40 per cent of all residential purchases. This tally means a doubling of mortgage volumes in the first six months of this year compared with the second-half of 2020.

The numbers also suggest that end-users are keen to enter the market now rather than take 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 offplan, according to the consultancy Mortgage Finder.

The average home loan amount is also up, by 24 per cent from second-half 2020 to now. The average mortgage size in the first six months 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 per cent of the first-half total.)

Mortgage rates are available from 1.99 per cent, compared with 2.49 per cent 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 per cent more, reducing the down payment requirement for first-time buyers from 25 per cent to 20 per cent. This has made getting a mortgage more accessible for some.”

Banks in the UAE are open for business. Many are currently offering great headline mortgage rates to entice borrowers, with some going further and being more flexible in their lending criteria depending on the borrower profile

- Ian Vaughan of Mortgage Finder