The buyers of 2017: Long-term residents get in the game

This article was originally published in Propertyfinder Trends 2017, Vol 3.

Reflecting back on the year so far, I’ve observed two main types of buyers: the current tenant turning into a homeowner, and the return of an increased number of investors.

Transactions, that is, the number of deals Allsopp & Allsopp has done, are also on a major upswing. We have seen a 29 percent increase in transactions year on year. I can say with certainty there is a tonne of appetite in the market.

The trend of a current tenant deciding that they are going to be far better suited paying their own mortgage isn’t anything new, it has been happening for quite some time now. What we have seen so far this year though, is that this ‘type’ of buyer has taken over any other type in the market.

There are a number of reasons for this:

Tenants living in Dubai for the past one to five years are looking to their future and seeing that at least their mid-term plans involve staying in Dubai. Rather than continue to rent and depart with ‘dead money’, they logically see putting their hard-earned income into their own property, and paying off a mortgage as the much better option. On top of homeownership, buyers don’t have to deal with the uncertainty of being at the mercy of a landlord’s notice to move out, or of a rent increase. There are many attractive mortgage rates and offers currently on the market. Our mortgage team currently has a range of exclusive offerings that can make a client’s monthly mortgage payment a lot less than their current rental payments (Click to see how your payments would compare).

With the price adjustments in the marketplace over the past couple of years, properties have dropped into a more affordable price bracket. This is coupled with the widely held belief that prices have ‘bottomed out’ and that we will start to see marginal increases in 2018, leading up to Expo 2020. Many have viewed 2017 as the best time to buy.

There are a lot more affordable housing options that have been released into the market, both in terms of off-plan launches and actual property handovers. The prime example of a ready property that has come into the market at an affordable level this year is in Mira. The properties there have been in extremely high demand all year and even at the time of writing, we have 2.7 percent pre-approved for cash buyers, looking to purchase in Mira, for every available Mira listing that we have.

We have seen a 29.1% increase in transactions year on year. I can say with certainty there is a ton of appetite in the market.

There was another telling statistic that I came across when taking a look at Allsopp’s year to date activity:
71 percent of the ready properties that we have sold this year were vacant or vacant on transfer. This further demonstrates the point that we are in a marketplace led by tenants looking to exit their own tenancy and move into a place of their own.

The only factor that is currently working against potential buyers is the loan-to-value (LTV) mandate, which is set at a minimum of 75 percent. For someone looking to buy, this translates to a minimum of approximately 32 percent of the property value in cash (including fees) to be able to complete a purchase.

With the ever-increasing cost of living, along with paying for an existing rent contract, this is a large sum to save. Without the 75 percent LTV policy, I believe we would see a lot more first-time buyers enter the market and an even healthier and stable property market.

Taking a look at the investor side of the market, what I observed this year so far is quite an increase in clients that are looking to invest. In September, just shy of 50 percent of our transactions were with investors, Allsopp’s year to date average is just over 42%. Digging further into the data, this year, 48 percent of our transactions were with a cash purchaser. In 2016 at this point in the year, it was 36 percent. Obviously, a cash purchaser isn’t always an investor, but a safe rule to follow is that the more cash purchasers in the market there are, then the more investors there are.


The return of more investors leads to one question: What is attracting them back to Dubai? At Allsopp, we believe there are many reasons, but here are a few that stand out:


  • There was an increased number of affordable housing options launched into the market by major developers this year. These are attractive to investors due to the lower outlay they have to make and also, more importantly, there is a high demand once handed over, both for rental and resale.
  • The introduction of attractive and generous payment plans allows the purchaser to spread their funds, and keep more liquidity in the short term. The amount
    of post-handover payment plans available also mean that an investor can utilise the rental income on handover towards the payment plan.
  • The fall in con dence in other property markets around the world. If we take London as one example, as that has been a popular destination for purchasers from around the Middle East, then we are seeing the market starting to struggle slightly, most notably after the Brexit referendum. Dubai looks to be capitalising on this, amongst many other markets, with an increased confidence in the market here.
  • The widespread feeling that we are at the bottom of the property cycle, and that going into 2018 we will see increased investment, jobs, and population in the run-up to Expo 2020. This climate will in turn lead to marginal price increases. Put simply, now is seen by many as a good time to buy.
  • A range of macro and geopolitical issues around the world. Of course, multiple books could be written on this, but issues include stock markets, currency fluctuations, oil prices, instability or perceived instability of nations and economies, and interest rates. With everything that is going on around the world, Dubai is increasingly viewed with confidence and optimism as a place to invest and see a good return on that investment.

So, what does this mean heading into 2018? As always, there is no crystal ball. But I would expect, based on what has happened this year, for a slowdown on the investor side. There has been so much launched this year, and so many investors buying, that I would expect there to be a ‘break’ where everyone re-groups.

In terms of tenants-turned-homeowners, I think we will see a continuation of the current trend. It is a move that makes an enormous amount of sense. With an ever-increasing population there is only going to be more tenants in the position to make such a decision.

Thinking of swapping your rent cheque for a mortgage in 2018? Get pre-approved for a mortgage with Mortgagefinder and find out which properties for sale are within your budget on


This article was originally published in Propertyfinder Trends 2017, Vol 3.

Click here to read the full report online (Adobe Flash required) or click here to download the PDF. To request a printed copy, drop us a line at



Lewis Allsopp,

Chief Executive Officer, Allsopp & Allsopp



BACKGROUND I’ve been working in the UAE real estate market for 12 years, nine as the CEO of Allsopp & Allsopp.
EDUCATION I learned all I know about business from my father.

KEY INSIGHT It’s important to look at the patterns in the market and see how they, and the market in general, evolves. WORDS TO LIVE BY Treat everyone as you would hope to be treated. If you’re good to people then good things happen in return. If you’re not good to people then you will eventually go the way of some very big companies that used to be in the market.


This Blog is made available for educational purposes only, in addition to providing you with general information and a general understanding of its content, including referenced laws and regulations, and not to provide specific legal advice. The Blog should not be used as a substitute for competent advice from a licensed professional.