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Home / NEWS / Mortgages comprise 55% of Dubai real estate sales

Mortgages comprise 55% of Dubai real estate sales

by Jumana Abdel-Razzaq on Mar 20, 2017


Mortgage activity in Dubai is starting to reflect that of the US and UK markets.
Mortgage activity in Dubai is starting to reflect that of the US and UK markets.

Mortgages currently comprise 55% of real estate sales activity in Dubai, more than doubling over the past seven years, according to a report by Reidin/Global Capital Partners.

The report findings indicate a maturing market in the emirate, with mortgage activity reflecting those of bigger markets such as the US and UK which see mortgages account for 60-70% of real estate transactions.

Last year revealed a paradigm shift towards more private developer projects accounting for mortgage activity than those of sovereign-backed industry peers.

This is a contrast from a couple of years ago, where the ratio of mortgages-to-sales activity in Dubai was below 20% in 2012. 

This gives an indication of an increasing willingness of banks to lend to private sector developments as well as confidence amongst buyers to purchase a property from a private developer.

Damac Properties recently announced that its in-house mortgage department has so far facilitated home financing worth $163m (AED600m) for hundreds of units across the UAE, the only developer that provides an in-house mortgage service in the region.

With this division, the developer is aiming to provide a booster for the UAE property market, where first-time millennial buyers who are salaried have “ample opportunity to jump on the property ladder”, said Niall McLoughlin, senior vice president, Damac Properties.

 



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