Tenants in Dubai are faced with a dilemma and seems they have a huge decision to make. As rent prices are going up due to various factors (mainly increasing demand post-pandemic) many tenants are considering taking the big step in their life and becoming a homeowner. Thankfully developers in Dubai are backing their side of this dilemma with attractive payment plans that are hard to take no notice of. (According to CBRE, at the half-year mark, Dubai’s rentals gains were averaging close to 25 percent while property values were up 9 percent.)
However, we must take notice that end-user buyers who are considering buying with a mortgage are conflicted with hiked rates at 0.75% successively due to which a noticeable drop was recognized in mortgage-backed sales as buyers feel the current market is too pricey for a mortgage in addition with inflated prices of real estate in Dubai.
Despite hiked property prices and mortgage rates, Dubai recorded 528 sales transactions worth Dh1.28 billion, in August 2022, data released by Dubai’s Land Department (DLD) showed. A further 91 mortgage deals were struck totaling Dh169.72 million, and 10 gift deals were done, amounting to Dh23.06 million.
The sales included 457 villas and apartments worth Dh893.08 million, and 71 land plots worth Dh387.16 million. The mortgages included 77 villas and apartments worth Dh131.13 million and 14 land plots valued at Dh38.59 million, bringing the total realty transactions to over Dh1.4 billion. These figures are an accurate representation of the buyer’s confidence in Dubai’s real estate market and the developer’s ongoing approach to cater to investors and end-users with attractive payment plans that extend to 5-8 years post-handover payment plans.
Dubai’s market has consistently outperformed an investor’s expectations by yielding one of the highest rates of return on investments and I believe it will continue to do so.