Mon, May 20, 2024 | 12 Dhul-Qadah 1445
Mon, May 20, 2024 | 12 Dhul-Qadah 1445
Good News! Experts believe more people will start getting mortgages because interest rates are likely to go down in 2024. The US Federal Reserve is expected to reduce rates by 25 to 100 basis points after 11 rate hikes. This means that more people might choose mortgages in the UAE, especially for regular homebuyers.
Experts are saying that changes in mortgage rates will have a big effect on how people approach buying homes, especially with the rising rental costs in the area. The idea of lower interest rates is seen as a trigger that could lead more people to switch from renting to owning property in 2024.
ValuStrat's data reveals that cash transactions currently dominate Dubai's real estate landscape, accounting for the majority of transactions. However, Abu Dhabi presents a different scenario with mortgage transactions playing a more significant role. The expected drop in interest rates in 2024 might change things, encouraging more buyers to opt for mortgages over cash, particularly considering the rising trend of rents compared to property values in Dubai.
It's analysts think that the expected change could mean that interest rates will have a bigger impact on property deals in Abu Dhabi compared to the current trend in Dubai where cash transactions are more common.
If you're renting or planning to buy a home, lower interest rates in the coming year could make a big difference. With rents going up faster than home prices, getting a mortgage might be a better deal, especially for homes in the lower and mid-price range.
Svetlana Vasilieva, Sales Director for the secondary market at Metropolitan Homes, notes that the majority of buyers capitalizing on lower mortgages are expected to be end-users seeking ready-to-move-in properties within the Dh1 million to Dh2.5 million price range.
Ayman Youssef, the Managing Director of Coldwell Banker, points out that lower interest rates are good news for people looking to buy homes. It makes owning a home more attractive than renting. Also, these lower rates might grab the interest of investors, giving them a chance for better returns.
The way people buy houses is changing. They're using more technology like applying for mortgages online and making super-safe transactions using blockchain. Some people are also choosing Sharia-compliant mortgages that follow certain rules, and there are special programs for people buying a house for the first time. They're also trying to be more eco-friendly when it comes to paying for houses.
These shifts, combined with the projected drop in interest rates, paint a dynamic picture for the UAE property market in 2024, with the potential for increased mortgage uptake and a reshaped landscape of property ownership.
