Dubai’s property market picked up in October as per Property Finder’s proprietary leads and search insights and the Dubai Land Department data. The 11,883 deals recorded were up 5% in September, the first rise after two months of decline. Sales value rose 18% to AED 34.8 billion, almost level with July’s AED 34.9 billion even though there were fewer deals than July’s 14,138. The recovery still has some way to go. Deal numbers remain below June and July, and well below the more than 17,000 a month recorded in January and February.
Residential drove the month. Residential deals rose 6% to 11,294, and their value rose 18% to AED 30.2 billion. Commercial deals eased 4% to 589, but commercial value rose 22% to AED 4.5 billion.
Resales led the rise in deals, climbing 13% to 5,304, 37% above their May low. Secondary sales value rose to AED 18.1 billion from AED 15.8 billion. Off-plan sales grew in value, not in number. Primary deals held at 6,579, compared with 6,593 in September, while primary sales value rose to AED 16.7 billion from AED 13.6 billion.
More people are borrowing, but each is borrowing less. The number of mortgages registered with the Dubai Land Department rose 5.2% to 3,811, the third consecutive monthly increase, while their total value fell 24.7% to AED 7.32 billion. The change was sharpest in apartments, where the average mortgage fell to AED 1.77 million from AED 2.67 million in September. A growing share of apartment buyers are using finance. 34.7% of apartment sales involved a mortgage, up from 31.0% in September and 26.7% in August, and apartments now account for 85.8% of all mortgages.
Villas went the other way. Villa sales reached 1,037, the highest in four months, but only 52.1% involved a mortgage, down from 79.2% in September. Villa buyers who did borrow took larger loans, and the average villa mortgage rose to AED 2.87 million from AED 2.74 million.
Prices have found their footing. Asking prices on Property Finder have adjusted since February and are now stabilising, which is helping bring buyers and renters back. In October, asking prices for homes for sale held steady, and asking rents rose for a second month in a row after their lowest level of the year in August. Renters still drive most activity on Property Finder, at 73% of Dubai leads, up from 58% in February. Buyers’ share of leads rose to 27% from 24% in September.
“Some will look at October’s 24.7% fall in mortgage value and see a weaker market. 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,” said Cherif Sleiman, Chief Revenue Officer at Property Finder.
He added, “Applicants earning AED 20,000 to 59,999 a month made up 68.5% of applications on our Mortgage Finder, up from 55.7% in September, and the average apartment loan fell to AED 1.77 million from AED 2.67 million. These are people buying homes they can afford, and the adjustment in asking prices since February has put more homes within their reach. Investors have returned to 12.8% of applications, concentrated in the same mid-income bands, and with renters making up 73% of our Dubai leads and asking rents rising again, the rental case is coming back. 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.”
