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Key trends driving the real estate market in the UAE indicate that its future looks bright

Real estate has long been a vital pillar of the UAE's economy, helping to consolidate its position as a gateway to the Middle East and beyond. Despite the impact of the pandemic, increased borrowing limits, coupled with stronger regulations and enhanced business confidence, are significant factors expected to drive activity in the sector during 2021.

As investors look to capitalise on these trends and buy properties, some of the key trends to consider are:

New Niche Segments

Across the Emirates, there has been an increased focus on affordability; with many low to mid-end property options entering the market. Additionally, the Dubai 2040 Urban Master Plan is expected to significantly contribute to the industry as more residents look for vibrant, green and inclusive communities to live in, and others look for larger spaces to accommodate their new 'work-from-home' schedules. Location should therefore be an important factor in any investment strategy.

Better Borrowing Conditions

The decision by the US Federal Reserve to maintain low benchmark interest rates has had a knock-on effect on home loan interest rates in the UAE; enabling individuals to benefit from significantly lower borrowing costs. The UAE Central Bank has also further boosted the market by increasing the loan to value ratios - allowing buyers to receive a mortgage of up to 80 per cent of the property value, or 85 per cent if they are UAE Nationals.

Digital Technology

Technological advancements in the real estate sector have transformed the home-buying journey to be more transparent and easier to navigate. Several banks in the region have made home loans accessible on the internet within just a few clicks. At Mashreq, customers can learn their loan eligibility, the cash flow required to purchase a property, and receive a pre-approval on their mortgage in just 10 minutes. Choosing the right financial partner, therefore, can make the process easier than ever, when purchasing a dream home.

Finally, as travel restrictions ease, Expo 2020 approaches and business confidence returns - investors will also have ample opportunities for a return on their investment in the long-term, as real estate prices rise gradually once more.