DUBAI’S SUB-DH2M HOME SALES ARE DOING FINE

End-users see value in mid-priced homes and mortgages despite 10 rate hikes

End-users seeking homes priced between Dh1 million to Dh3 million are making a strong return to the Dubai property market, fuelling the developer rush to launch projects in this price range.

April and May have been rated as “outstanding” for mortgage demand, as end-user buyers lock in bank financing to go with what they can put up as equity.

This buying of mid-priced is what is giving the ongoing Dubai property market surge depth even as at the top end of the market more deals are happening at Dh400 million plus.

Mid-priced home buyers — most being first-time investors in Dubai real estate — are not being dissuaded despite the 10 interest rate hikes since March 2022, whereby fixed-rate mortgages are around the 5 per cent mark and floating rates come up to 7 per cent or thereabouts.

Average purchase price

“We’re seeing an average purchase price of Dh2.8 million, while 46 per cent of our applicants are purchasing below Dh2 million,” said Michael Hunter, CEO and co-founder of Dubai-based Holo, the mortgage advisory platform.

“We are seeing is buyers opting for shorter fixed-interest rate periods, of between 1-5 years. Historically we would see five-year fixed rates being the norm whereas now we are seeing buyers opt for 1-3 years.”

There are no signs of the hesitation end-user buyers had at the end of 2022 when mortgage rates keep rising. Banking sector sources had at the time spoken about 30-40 per cent dips in their mortgage disbursals during the fourth quarter.

What should you buy?

Mark Castley, CEO of LuxuryProperty.com, says getting the right price on an offplan home is all about timing for the buyer. “Offplan does still offer a lower buying threshold — provided that buyers can get the initial stock,” he said. “Once an offplan project goes on to the resale market, the lack of stock will push prices upwards.”

Abdullah Al Ajaji, CEO and founder of Driven Properties, said: “Because of the strong performance of Dubai’s luxury and ultra-luxury sectors, this priced out a number of participants who are now buying into the mid-market space, thereby spurring increased demand.”

Chinese getting active

More signs are starting to show of Chinese funding inflows. “We expect to see significant capital coming from China and other parts of Asia throughout the year and leading into next year,” said Al Ajaji. “When it comes to Europe, Germany, France, and the UK have been extremely active over the past three years.”

Property portal Bayut.com

says it’s the first in the UAE to introduce the Chinese language option on the site.

Haider Ali Khan, head of Dubizzle Group Mena and CEO of Bayut and dubizzle, said: “Looking at the growing interest of Chinese investors in the region, the introduction of the Chinese language option perfectly aligns with our mission to provide a seamless property search experience.”

Because of the strong performance of Dubai’s luxury and ultra-luxury sectors, this priced out a number of participants who are now buying into the mid-market space, thereby spurring increased demand.”

Abdullah Al Ajaji | CEO and founder of Driven Properties

We’re seeing an average purchase price of Dh2.8 million, while 46 per cent of our applicants are purchasing below Dh2 million.”

Michael Hunter | CEO and co-founder of Dubai-based Holo

Offplan does still offer a lower buying threshold ... Once an offplan project goes on to the resale market, the lack of stock will push prices upwards.”

Mark Castley | CEO of LuxuryProperty.com

Dubai’s property market has had back-to-back sales of Dh400 million plus homes, but the action in the under Dh2 million space is robust as first-time investors choose to live in Dubai. ■

The China Railway 18th Bureau Group has been confirmed as the main contractor for the Al Habtoor Tower in Dubai. The project is valued at Dh3.7 billion. The tower will have 1,701 keys over a built-up area of 3.51 million square feet in an 81-floor (G+7+73) format. ■

■ Phase 2 of the California Village in Dubai has gone on sale, with three-bedroom townhouses and five-bedroom villas. The planned completion is set for 2025. Investors can choose a seven-year offplan payment structure, with 30 per cent during construction. Infracorp is the developer and with Betterhomes as sales agent. The project is located within easy reach of Shaikh Mohammad Bin Zayed Road and Shaikh Zayed Bin Hamdan Al Nahyan Street. Units are priced from Dh2.8 million.

The launches keep happening. In Abu Dhabi, Bloom Holding, has released the third phase — Casares — at its Bloom Living community. With investors having shown marked preference for bigger living spaces, the latest release comes in two- and three-bedroom townhouses. Prices start at Dh1.6 million. This phase should be completed by the first quarter of 2026. ■

The master-developer Arada has completed 585 homes at The Boulevard in Aljada. The nine-storey blocks are located next to Aljada’s main East Boulevard avenue. The one-, twoand three-bedroom apartments come in a variety of sizes and floor plans, and are principally targeted at singles, young couples and families. The starting prices for these homes were Dh450,000. The units are sold out. ■

One of The Palm’s new projects, the Serenia Living’s main contractor award has gone to Khansaheb. The project which is owned by Banian FZCO, will be developed by Palma Development which earlier built the Serenia Residences The Palm in 2018. The current project, with 226 apartments is scheduled for handover in Q1 2026. One of the units of the sky mansions is valued at Dh200 million plus.