The number of mortgages registered in Dubai rose for a third consecutive month in October, even as their total value fell almost a quarter, according to an analysis by Property Finder of Dubai Land Department (DLD) data.

Registered mortgages increased 5.2 per cent to 3,811, while their combined value dropped 24.7 per cent to Dh7.32 billion.

The change was sharpest in apartments, where the average mortgage fell to Dh1.77 million from Dh2.67 million in September.

A growing share of apartment buyers are using finance. Some 34.7 per cent of apartment sales involved a mortgage in October, up from 31 per cent in September and 26.7 per cent in August. Apartments now account for 85.8 per cent of all mortgages.

Borrowing has become expensive due to the rising interest rates in the UAE.

On September 16, the Central Bank of the UAE (CBUAE) announced raising the Base Rate applicable to the Overnight Deposit Facility (ODF) by 25 basis points, from 3.65 per cent to 3.9 per cent.

This decision was taken following the US Federal Reserve's announcement to raise the Interest Rate on Reserve Balances (IORB) by 25 basis points.

Mortgage Finder, a unit of Property Finder, said applicants earning between Dh20,000 and Dh59,999 a month made up 68.5 per cent of applications, up from 55.7 per cent in September. Investors accounted for 12.8 per cent of applications, concentrated in the same mid-income bands.

"Some will look at October's 24.7 per cent 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.

"These are people buying homes they can afford, and the adjustment in asking prices since February has put more homes within their reach," he added.

According to Cavendish Maxwell, mortgage transactions recovered in Q3 2026, rising 32.9 per cent quarter-on-quarter to approximately 10,000, and were 2.7 per cent higher year-on-year.

Apartment mortgage transactions increased 29.2 per cent quarter-on-quarter to around 6,100, although they remained 3.5 per cent below Q3 2025.

Townhouse and villa mortgage transactions recorded a stronger increase, rising 39 per cent quarter-on-quarter to around 3,900 and 13.9 per cent year-on-year. The increase can be attributed to property handovers and refinancing, alongside mortgage-financed property purchases.

Villas bucked the trend. Sales reached 1,037, the highest in four months, but only 52.1 per cent involved a mortgage, down from 79.2 per cent in September. Those who did borrow took larger loans, with the average villa mortgage rising to Dh2.87 million from Dh2.74 million.

Overall, Dubai recorded 11,883 property deals in October, up 5 per cent from September and the first rise after two months of decline. Sales value climbed 18 per cent to Dh34.8 billion, almost level with July's Dh34.9 billion, despite 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 transactions drove the month, rising 6 per cent to 11,294, with value up 18 per cent to Dh30.2 billion. Commercial deals eased 4 per cent to 589, but their value rose 22 per cent to Dh4.5 billion.

Resales led the increase in deal numbers, climbing 13 per cent to 5,304, which is 37 per cent above their May low. Secondary sales value rose to Dh18.1 billion from Dh15.8 billion.

Off-plan sales grew in value rather than volume. Primary deals held at 6,579, against 6,593 in September, while primary sales value rose to Dh16.7 billion from Dh13.6 billion.

(Source: Khaleej Times)