Latest figures from Mortgage Finder reveal 78% increase in enquiries to banks for mortgage approvals
Property prices in the UAE continue to fall as figures released show the average size of a home loan in the country in May was $356,000 (AED1.31m), compared to $454,000 ($1.67m) in May 2018, a drop of 27 percent.
Mortgage Finder, part of the Property Finder Group, also revealed enquiries between April 2018 and April 2019 were up by 59 percent, and submissions to banks for mortgage approvals up by 78 percent.
Chris Schutrups, managing director, Mortgage Finder, said: “We have seen a shift from an investor-led market to an owner-occupied market, with more end-users buying to live in the property. This is likely due to the downward shift in prices which has made home ownership more affordable and achievable.”
In terms of interest rates, Mortgage Finder estimates that buyers prefer opting for a fixed rate in over 80 percent of enquiries.
“However, with recent predictions from the US Federal Reserve about rate reductions this year, we are seeing a few more sophisticated buyers opt for lower margin variable rates,” said Schutrups.
After the UAE Central Bank introduced the 3 percent early settlement fee, refinancing transactions and mortgage transfers between banks have reduced considerably.
“We estimate that there has been about a 75 percent reduction in the number of refinancing transactions and buyouts that we do. However, it is worth noting that these only accounted for 5 percent of transactions in 2018,” added Schutrups