Dubai Property Sales Rise 18% to Dh34.8 Billion in October as Mortgage Numbers Climb

The number of deals rose 5 per cent to 11,883. That is still below the volumes recorded earlier in the year, but the value of sales came close to July's Dh34.9 billion with fewer transactions, which means the average deal was bigger. For developers, lenders and investors watching for a bottom, the figures are the clearest sign so far that buyers are coming back. Property Finder says the recovery is being led by middle-income end users rather than a return of speculative money.

Residential property accounted for most of the activity. Home sales rose 6 per cent to 11,294 and their value climbed 18 per cent to Dh30.2 billion. Commercial deals fell 4 per cent to 589, but their combined value rose 22 per cent to Dh4.5 billion, which points to larger individual transactions.

Resales drove much of the growth. Secondary-market deals rose 13 per cent to 5,304, which is 37 per cent above their May low, and their value increased to Dh18.1 billion from Dh15.8 billion in September. Off-plan sales were roughly flat at 6,579 transactions, but their value rose to Dh16.7 billion from Dh13.6 billion.

Mortgage data told a more mixed story. Registrations with the Land Department rose 5.2 per cent to 3,811, the third monthly increase in a row, while the total value of those mortgages fell 24.7 per cent to Dh7.32 billion. The average apartment mortgage dropped to Dh1.77 million from Dh2.67 million in September. The share of apartment purchases financed with a mortgage rose to 34.7 per cent, from 31 per cent in September and 26.7 per cent in August, and apartments now make up 85.8 per cent of all registered mortgages.

Villa sales reached 1,037, the highest in four months. The share of villa purchases using a mortgage fell to 52.1 per cent from 79.2 per cent in September, while the average villa mortgage rose to Dh2.87 million from Dh2.74 million.

Cherif Sleiman, chief revenue officer at Property Finder, said the rising number of mortgages mattered more than the fall in their value. "More people are buying, with smaller loans, so the market is getting broader," he said. He said lower asking prices since February had brought more homes within reach of buyers.

Data from Mortgage Finder, Property Finder's lending platform, supports that view. Applicants earning between Dh20,000 and Dh59,999 a month made up 68.5 per cent of mortgage applications in October, up from 55.7 per cent in September. Investors accounted for 12.8 per cent of applications, mostly in the same income bands, Sleiman said.

The rental market remains the bigger draw. Tenants generated 73 per cent of enquiries on Property Finder in October, compared with 58 per cent in February, while the buyer share rose to 27 per cent from 24 per cent in September. Asking rents rose for a second month after hitting their lowest level of the year in August, and asking prices for homes listed for sale held steady.

Sleiman said the market still had ground to recover. "Dubai's recovery is being built from the middle. Volumes are still below the start of the year, so there is further to go, but a market with depth is a market that lasts," he said.