Doubled Property Prices in Dubai: First Half in 2021
The first half of 2021 saw an increase in mortgage-backed sales in Dubai, as low-interest rates and rising property values enticed several investors and long-term tenants to become property owners.
According to Zawya News, “Over 12,000 mortgage-linked purchases were registered in the first six months of 2021, totaling over 20 billion dirhams, compared to roughly 7,000 last year, totaling over 10 billion dirhams in value”. Zawya further added the uptick is projected to continue into the second half of 2021. Mortgages are available in the UAE for a wide range of assets, including premier properties. Coping up all the facts, Zawya concluded that the residential properties are assessing for more than 100 million dirhams for various banks.
Mortgage transactions climbed by 91 percent in the first half of 2021 compared to the second half of 2020, according to new data from Mortgage Finder. Furthermore, the survey indicated that in the first half of 2021, 40% of Dubai sales deals were completed with a mortgage.
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Rising Percentage Rates
Mortgage interest rates in the UAE are at an all-time low, according to a Senior Mortgage Consultants in Dubai, who told Zawya that mortgages currently start at just 1.99 percent, down from 2.49 percent in the middle of 2020. Banks in the United Arab Emirates are now open for business and are providing more competitive goods. Rates are expected to remain at historic lows long until 2022 and possibly 2023 as well.”
Following the lockdown, he added to his chat that the market has seen an increase in demand from residents looking to acquire and move into larger places, particularly residences with private gardens and pools. “We’ve witnessed a nearly 50/50 split in mortgage transactions between villas/townhouses and apartments, even though apartments have historically been more popular among our clients.”
Ways of Mortgaging being developed
Homebuyers and families are more likely to use mortgages than cash speculators.
According to a managing partner, a large majority of the mortgage purchasers they work with are long-term tenants who understand the need of paying their mortgage rather than relying on someone else to do so.
“Dubai is home to a big number of long-term ex-pats; these families have witnessed prices fall over six years to reach record lows last year, and have watched the market rise and surge since then,” he stated. They may own a property abroad, but this is likely to be their first home purchase in the United States.”