Mortgage transaction volumes in Dubai hit a near 14-month high in May, showing a significant increase of 57.9% compared to previous months. Despite high interest rates in the UAE, the demand for local property remained strong. The Dubai Land Department reported that May recorded the second-highest mortgage activity in the emirate, indicating a positive growth trend in the real estate sector. Allsopp & Allsopp confirmed this trend, noting that the mortgage sector continues to rise with favorable market conditions for potential buyers.
The mortgage sector in Dubai is experiencing significant growth as more buyers are taking advantage of low interest rates. Mortgage advisors have become essential in guiding buyers through the process and negotiating the best terms with multiple banks. With interest rates expected to decrease in the future, buyers are showing increased interest in securing mortgages for property purchases. Allsopp & Allsopp noted a surge in mortgage activity, primarily driven by finance buyers outpacing cash buyers, with popular locations such as Downtown Dubai, Dubai Marina, and Jumeirah Beach Residence being top choices for younger individuals.
The real estate market in Dubai is witnessing a shift towards suburban areas as more buyers are considering these locations due to affordability compared to city center properties. Villas in areas like The Springs, Arabian Ranches, and Town Square are gaining popularity among buyers looking for more space and amenities. Property Monitor reported that new purchase money mortgages accounted for the majority of borrowing activity, with an average amount borrowed of Dh1.85 million. Additionally, loans for refinancing and equity release saw a decrease in market share, while bulk mortgages taken by developers and large investors increased in demand.
Overall, the mortgage sector in Dubai is experiencing a period of growth and increased activity, driven by low interest rates and strong demand for local property. Buyers are encouraged to seek advice from independent mortgage advisors to secure the best terms and make informed decisions. As interest rates are expected to decline in the near future, it is a favorable time for buyers to explore mortgage options and take advantage of the market conditions. With a focus on suburban areas and popular lifestyle destinations, the real estate market in Dubai continues to evolve to meet the needs and preferences of buyers.
