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Dubai’s Developers Return with Post-Handover Plans with Rising Mortgage Rates

  • August 17th, 2022

Developers in Dubai are rolling back longer post-handover payment terms, and the recent off-plan launches also introduced a ‘7.5-year’ provision. This is intended to ease buyers’ concerns about higher mortgage rates, as more hikes are due at least later this year.

Another popular payment plan, pioneered by Danube Properties, is doing the off-plan rounds. This is a 1 per cent monthly fee, for a period of up to 99 months. Interestingly, many of these launches are in an affordable category, with a base price of over Dh500,000 and a two-bedroom apartment ranging from Dh1.5 million to Dh2 million, depending on the location and developer’s numerous value-adds.

Dubai property requires cash buyers and users both with mortgage plans – said a developer. Bringing back post-handover plans was a no-brainer. Otherwise, the market risks losing potential buyers because they will be obsessed with mortgage rates.

These developers are getting even more buyer-friendly in their payment plans, as their recent launch hit the investor sweet spot at just under DH2 million. And these launches were attracting first-time buyers to Dubai properties, many of whom were in their 20s and 30s, while traditional buyers were older.

Still Holding Up

By all indications, Dubai property sales were active throughout the summer, but what was equally notable was the decline in mortgage-backed sales. The previous two increases, of 0.75% each, must have been overwhelming for budget-conscious salaried buyers.

“Like before, developers are redoubling their efforts to convince buyers that it’s still a good time to buy,” said a real estate agent. ‘As this depends on the fate of the upcoming off-plan launches.

In the Dubai South projects, there will be various post-handover plans in Al Furjan and many areas of Dubailand.

The Beachfront

A new one is also starting to build profiles with investors: Emaar Beachfront. “Handovers have already begun with residents occupying some of the completed towers, such as Beach Vista,” a Betterhomes spokesperson said (which is one of the listing partners on the portal Moreover, there are many developments are under construction with handovers estimated between now and 2027.

“That said, it received varied demands from buyers. Currently, Betterhomes Group is seeing launches sold out on the same-day aftermarket sales, receiving higher premiums near unit deliveries as many buyers see the potential of a finished project.”

Awaiting Expo City

The new destination that will occupy the Dubai Expo site is one of the most anticipated in the real estate market. While people will start working from the redesigned buildings in Expo City in October, details on the residential side are awaited.

Expo City Dubai South will drive more investor interest and demand, that’s for sure,” said a developer. In Expo City, all the offices opening from October will develop the needs of nearby staff, and Dubai South will be the answer.

“The action is just beginning.”

Source: Property News