According to experts, the Dubai real estate market will be unaffected by the ongoing rise in interest rates and will continue to rise due to increased demand.
Rising interest rates, according to analysts, real estate executives, property developers, and industry insiders, won’t have a significant effect on the real estate market because mortgage transactions make up only 25% of all home sales. They did, however, issue a warning that the price increase would affect future demand and reduce the market’s rate of expansion.
“There is no question that the real estate market is badly impacted by increasing borrowing costs. However, given that mortgage transactions account for barely a quarter of all property sales in Dubai, this impact is not anticipated to be particularly severe “According to Haider Tuima, director and head of ValuStrat’s real estate research, Khaleej Times.
The Federal Reserve hiked benchmark interest rates last week for the third time in a row, this time by three-quarters of a percentage point, and said it will continue to do so well above the present level.
The goal of the US central bank is to reduce inflation, which is currently close to its highest levels since the early 1980s. It raised federal funds rates to their highest level since early 2008, a range of 3% to 3.25 percent.
Fed officials signalled the intention of continuing to hike until the funds level hits a ‘terminal rate’, or end point, of 4.6 per cent in 2023. That implies a quarter-point rate rise next year, but no decreases.
Investors’ purchasing habits
The recent increase in interest rates, according to Yousuf Fakhruddin, CEO of Fakhruddin Properties, may have an impact on investors’ purchasing patterns in the market. Although rising interest rates might have an impact on the market in terms of demand and costs, he added, “it also provides us a chance to offer our customers more enticing payment plans.”
As an illustration, we provide a post-handover purchase plan with a “pay 1% interest” payment schedule. This gives our customers the chance to learn more about our strategy and profit from its beneficial features. Investors can experience greater peace of mind and avoid the headache of fluctuating prices with this arrangement. Everything ultimately comes down to the buyer’s affordability and the state of the market. We have faith that the