The UAE’s growing mortgage market is reflected in the number of home-loan providers setting up operations here. Until recently, there were only a handful of mortgage companies in the country, and the sector was dominated by local banks. Today, international financial institutions are lining up to take advantage of the lucrative business opportunities available in the region.
More competition, in turn, will lead to more attractive loan packages for buyers, which will fuel more interest among prospective homeowners, which will increase competition further, and so on. It is the best possible cycle and promises to provide an added boost to the local economy.
The reason for this is simple: An increase in mortgage availability will necessarily open up the housing market to more buyers, which will increase construction, encourage foreign direct investment, stimulate the banking sector and have a knock-on effect across many other areas.
Equally importantly, though, making home ownership more widely available will promote stability and establish ties between a country and its residents that go beyond the financial. The fact that more people are taking out mortgages signals an increase in public trust in the country’s economy and its institutions. It also suggests that people are here for the long haul. And it’s not only Dubai where this dynamic is unfolding – other emirates too are seeing a rise in the mortgage market.
As rents continue to rise and mortgage payments become more attractive, the current upward trend is sure to continue. This is good news in ways that go beyond economic considerations. No longer will owning a home be the privilege of the wealthy. No longer will people living on lower incomes be consigned to a lifetime of paying rent.
[Source : Emirates Today]