Dubai is a modern city and is also considered a global hub for real estate investment. Investing in Dubai’s real estate market in 2025 is also a great choice because the city’s property market continues to show strong momentum mainly because of factors such as luxury yet affordable real estate, high ROI potential, property ownership rights for foreigners, long-term residency option, regulatory transparency, flexible payment plans and the availability of several financing options.
Not everyone can purchase real estate in Dubai through personal savings or liquid assets. Here come a number of property financing options to assist people in realizing their dream of buying and owning property in one of the most advanced cities in the world. No matter whether you intend to buy a luxury villa for sale in Dubai or an affordable apartment for sale in JVC, you can consider several financing options, irrespective of your nationality status.
So when investing in Dubai’s real estate, prospective investors are required to have some know-how about available financing options to consider and choose the most suitable one because this city also extends a broad spectrum of options tailored to different investors’ profiles. Seeking a property financing option in Dubai in 2025? Then read this blog to educate yourself regarding this matter and make property purchase possible.
Understanding Property Financing in Dubai
It is essential to understand the concept of property financing in Dubai for people who plan to buy real estate in Dubai in 2025. Generally, it is a straightforward process that extends a number of choices based on the profile of a buyer. People who cannot afford to purchase their homes in Dubai in 2025 on their own can finance their property purchase through bank mortgages or private lenders which support your property purchase under the framework of the UAE Central Bank.
In general, Dubai comes with a well-structured and flexible financing framework, catering to the needs and requirements of different types of investors. It means you can purchase both ready-to-move-in and off-plan property for sale in Dubai through several real estate financing options available for you such as local banks, Islamic financing institutions, developer-backed flexible payment plans and private lenders. When selecting a property financing option, you must consider factors that can influence available options such as property type, residency status and the purpose of purchase.
Types Of Mortgages In Dubai:
Fixed Rate Mortgage: This mortgage type keeps the interest rate fixed for a specific period, ranging from one to five years. The interest rate remains unchanged for a decided term, keeping monthly payments predictable. Market fluctuations do not influence this decided interest rate. And when a decided term finishes, the interest rate can be revised. Basically, it is considered a stable financing option.
Variable Rate Mortgage: The Emirates Interbank Offered Rate (EIBOR) influences interest rates and, eventually monthly payments. It means monthly payments can go up or down based on the condition of the market. Monthly expenses or payments remain less predictable in this type of Mortgage.
Discounted Rate Mortgages: This mortgage type offers a temporary discount on the standard interest rate. A borrower can enjoy discounted rates for a specific time which can be a year or two and when this decided time ends then a borrower is expected to return to the full variable rate.
Offset Mortgage: In this type of mortgage, a borrower’s savings account is linked with his mortgage loan. Interest payments related to saving are then used to lower the interest charged on your mortgage payment, reducing the overall loan costs gradually without dictating your access to your savings.
Remortgage: Moving the current mortgage to a different lender is called remortgage. People normally consider this option to get a lower interest rate or take out some of the payments that are built up in their property. This mortgage type can help people to get access to extra funds or reduce monthly loan payments.
Conventional Bank Mortgages
When it comes to Dubai home loans, people usually consider bank mortgages. Banks such as Emirates NBD, Dubai Islamic Bank and HSBC extend home loans to both locals and expats. Non-residents can also get mortgages in Dubai. A borrower is required to have a steady income and a good credit score to qualify for a home loan in Dubai. UAE nationals are required to pay 15% property price while expats are required to pay 20% payments as a down payment. A home loan can be obtained through conventional banks on fixed, variable and mixed interest rates.
Mortgage Eligibility:
Also, consider mortgage eligibility rules set by the UAE Central Bank when considering a property purchase in Dubai through financing. UAE nationals can get a loan of up to 80% of the property value if the value of the property is AED 5 million or less. The borrowing percentage reduces to 70% if the value of the property exceeds AED 5 million. In the case of a second home, a UAE national can borrow up to 65% of the property value.
Expats can borrow up to 75% of the property value if the price of a property is AED 5 million or less. The borrowing limit drops to 65% for expatriates if the value of property exceeds AED 5 million. People who purchase a second home can borrow up to 60% of the total value.
If you desire to invest in an off-plan property for sale in Dubai then you can expect to get around 50% of the property value in terms of financing, irrespective of your nationality status. It means the limit to borrow loans in case of incomplete or under-construction properties is the same for all UAE nationals, GCC nationals and expats.
Exploring The Factors That Determine Mortgage Eligibility
Several factors determine mortgage eligibility such as monthly income, existing debts, employment status, value of property, credit score, etc. It is pertinent to mention that your total monthly debt repayments should not cross 50% of your monthly income. This threshold will also include your new mortgage. Banks consider this Debt Burden Ratio to analyze the eligibility of an investor.
Islamic Home Financing Options:
Sharia-compliant home loans are also available when you consider property financing in Dubai. Islamic financing models such as Ijara and Murabaha are considered alternative approaches against traditional interest-based loans when it comes to buying property through financing in Dubai.
Ijara Financing
In this specific case, a lender, basically, purchases a property and then leases it to a lender or property buyer which then makes rental payments to that lending entity for a defined period of time. Once a borrower completes the lease period, he, then, owns that particular property.
Murabaha Financing
In this case, a lending entity buys a property and then sells it back to a borrower or property investor at a higher price. A buyer is then required to make payments through installments. Payments are basically spread over a specific period, enabling investors to pay gradually.
Private Financing:
People who are unable to get home loans from conventional banks can consider private lenders and financial institutions in Dubai to get mortgages or finance their property purchase in the emirate of Dubai. It is easier to get financing from private entities than conventional banks because these institutions are more flexible when it comes to credit score and income. In addition to that, borrowers also enjoy more control over repayment plans and loan conditions. Interest rates are, though, comparatively higher than conventional mortgages.
Equity Release and Refinancing
Property owners can also use the value of their current owned real estate in order to purchase further property for sale in Dubai. An investor can use his built-up equity in his home to borrow money for another purchase. People who intend to expand their real estate portfolios in Dubai can choose this way of property purchase. Refinancing is, basically, an option that gives borrowers leverage to renegotiate the terms and conditions of already existing home loans to get extended tenures or lower interest rates.
Developer Payment Plans:
Property developers in Dubai also come with attractive and flexible payment plans to facilitate property investors. Investors can take advantage of these flexible payment plans because they often eliminate the need for home loans in Dubai. These payment plans include a post-handover payment plan which allows investors to make their payments several years after they get possession of that particular property and a 1% payment plan that allows people to pay only 1% of the total amount each month after paying initial down payments. Developer payment plans are also interest-free, reducing additional costs such as interest payments.
Government-Backed Housing Loans:
UAE nationals can also take advantage of government-backed housing loan plans such as the Sheikh Zayed Housing Program. These loan programs normally come with quite low or zero interest rates, allowing locals to finance their property purchases seamlessly. In addition to that, repayment periods are also quite longer in these cases.
Tips for Securing the Best Financing Deal
- One needs to optimize his credit score because a higher credit score increases the chances of getting better loan terms and even suitable interest rates. So, one needs to pay bills on time and reduce existing debts to improve his credit score.
- It is a decent approach to apply for a mortgage pre-approval in Dubai. This will help you to get an idea about your borrowing capacity.
- When seeking a property financing option in Dubai, you should also negotiate terms and conditions such as interest rates, repayment periods and lender’s charges to crack a better deal or even get a discounted loan payment.
- Do not forget to get the services of a financial advisor or mortgage broker because they are experts and they understand all nuanced complexities. So, they can help you find the best option that suits your interest the most.
The Bottom Line:
When buying property in Dubai, you should consider property financing options if you are unable to afford property purchase through your savings. Dubai’s property financing landscape in 2025 extends flexible and accessible solutions, tailoring to the needs of different investors. Locals, expats and even non-residents can get home loans in Dubai. Property financing options in Dubai include conventional bank mortgages, Islamic financing options, private lending, developer payment plans, government-backed loans, etc. Buyers can choose the best option from these multiple pathways to make property buying in Dubai a reality.
Make Your Dubai Property Purchase Smooth With Our Expert Support!
Kelt and Co Realty is a prominent real estate agency in Dubai. This property company comes with a range of residential and commercial properties for sale and rent in Dubai. If you desire to own luxury or affordable property in Dubai then let us find the most suitable investment option for you because our dedicated team believes in delivering value by offering tailor-made real estate services.
FAQs
What types of mortgages are available in Dubai?
Several types of mortgages such as fixed-rate mortgages, variable-rate mortgages, discounted-rate mortgages, offset mortgages and remortgages are available in Dubai, allowing investors to choose the most suitable option.
Can non-residents get a mortgage in Dubai?
Yes. Some banks extend home loan options in Dubai to non-residents. If you are a non-resident then you can still get a mortgage. However, terms and conditions can be tough in this scenario.
What is the Debt Burden Ratio (DBR)?
Basically, it is a percentage of your monthly income spent on debt repayments. Your monthly loan payments should be less than 50% of your monthly income to secure a mortgage in Dubai.
Can foreigners buy off-plan properties in Dubai?
Yes. Foreign nationals are eligible to purchase all kinds of properties, including off-plan properties for sale in Dubai if they are located in freehold areas of the city such as Downtown Dubai, JVC, Dubai Hills Estate, etc.
