Dubai Mortgages Rise for a Third Month in October as Average Loans Shrink

The split matters because borrowing has become more expensive. On September 16 the Central Bank of the UAE raised the Base Rate on its Overnight Deposit Facility by 25 basis points to 3.9 per cent from 3.65 per cent, after the US Federal Reserve raised the interest rate it pays on reserve balances by the same amount. Even so, more buyers are using loans, and mainly for cheaper apartments, which suggests demand is moving toward lower-priced homes rather than drying up.

Apartments drove the change. The average apartment mortgage dropped to Dh1.77 million in October from Dh2.67 million in September. A mortgage was involved in 34.7 per cent of apartment sales, up from 31 per cent in September and 26.7 per cent in August. Apartments now make up 85.8 per cent of all mortgages registered in the emirate.

The borrowers are increasingly mid-income. Mortgage Finder, Property Finder's lending unit, said applicants earning between Dh20,000 and Dh59,999 a month accounted for 68.5 per cent of applications in October, up from 55.7 per cent a month earlier. Investors made up 12.8 per cent of applications, concentrated in the same income bands.

Cherif Sleiman, Property Finder's chief revenue officer, said the fall in value should not be read as weakness. "The more important number is that mortgages rose for a third month in a row. More people are buying, with smaller loans, so the market is getting broader," he said. He linked the shift to lower asking prices, saying "the adjustment in asking prices since February has put more homes within their reach".

Villas went the other way. Villa sales reached 1,037, the highest in four months, but only 52.1 per cent involved a mortgage, down from 79.2 per cent in September. Villa buyers who did borrow took larger loans, with the average villa mortgage rising to Dh2.87 million from Dh2.74 million.

The longer trend also points to recovery. Consultancy Cavendish Maxwell said mortgage transactions rose 32.9 per cent from the previous quarter to about 10,000 in the third quarter of 2026, and were 2.7 per cent higher than a year earlier. Apartment mortgages rose 29.2 per cent quarter on quarter to about 6,100 but stayed 3.5 per cent below the third quarter of 2025. Townhouse and villa mortgages rose 39 per cent to about 3,900 and were 13.9 per cent higher year on year. The firm attributed that rise to handovers and refinancing as well as new purchases.

Across the whole market, Dubai recorded 11,883 property deals in October, up 5 per cent from September and the first monthly rise after two months of decline. Sales value climbed 18 per cent to Dh34.8 billion, close to July's Dh34.9 billion even though July had more deals, at 14,138. Residential deals rose 6 per cent to 11,294, worth Dh30.2 billion. Commercial deals fell 4 per cent to 589, but their value rose 22 per cent to Dh4.5 billion.

Resales led the rise in deal numbers, increasing 13 per cent to 5,304, which is 37 per cent above their May low, with secondary sales value up to Dh18.1 billion from Dh15.8 billion. Off-plan volumes were flat at 6,579 deals against 6,593 in September, though their value rose to Dh16.7 billion from Dh13.6 billion.

Volumes are still well below the start of the year. Monthly deal counts remain under June and July levels and far short of the more than 17,000 recorded in each of January and February.