KHALEEJ TIMES, Sunday, Oct 24, 2021 | Rabi Al-Awwal 17, 1443
Low-interest rates boost mortgage transactions in 2021
Emirates:
The mortgage market in Dubai has grown at an exponential rate in the first three
quarters of 2021, growing by 68 per cent compared to last year and 71 per cent
more than in 2019, according to the latest official data revealed on Sunday.
Data released by mortgage Finder, an independent mortgage consultancy in the UAE
and part of the Property Finder Group, on Sunday revealed that Q3 2020 was a
notably active period in the mortgage industry. This came 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.
“It has been a very busy year, with the total number of mortgages registered in
Dubai during the first three quarters already overtaking the total number
registered in the whole of 2020. This is so exciting to see as more buyers are
getting onto the housing ladder,” said Warren Philliskirk, director at Mortgage
Finder.
“Now with Expo opening, we’re even more excited to see what happens as we enter
the final quarter of the year,” he added.
Low interest rates are a major factor attracting new buyers to the local
property market as 83 per cent of mortgage transactions were conducted by people
who were purchasing property for the first time in the UAE.
In 2020, the UAE Central Bank reduced the down payment requirement for
first-time buyers in the UAE by five 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.
Dubai’s real estate market has seen records being broken this year in terms of
the value and volume of transactions as foreign investors flocked to the local
market to cash in on the attractive prices. As a result, the property sector
reached a new milestone in the third quarter of 2021, as it became the best
third quarter ever in terms of transaction value in the history of the emirate’s
real estate sector, reaching Dh42.35 billion. In September. At the same time,
real estate transactions crossed the Dh100 billion mark in September due to
phenomenal growth in monthly sales, thanks to the presence of a good number of
international investors in the market.
Villa/townhouse properties accounted for 63 per cent of mortgage purchases while
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.