'Extraordinary' number of Dubai properties bought with cash

31/01/2013 - Dubai Property News Posted by Bob Brunskill
'Extraordinary' number of Dubai properties bought with cash

There was an "extraordinary" number of people purchasing Dubai properties with cash last year, a new report has suggested.According to an investigation conducted by Arabian Business, a massive $30 billion (AED 110 billion) was used to pay for buildings up front in 2012.This was the equivalent of 70 per cent of all real estate transactions completed in the city, which is a phenomenal figure.General manager of mortgage adviser Independent Finance Sam Wani said that global cash purchases usually come in at around the 20 to 30 per cent mark, with the rest being paid for with mortgages.It seems that foreign investors returned to the UAE market in their droves last year and the majority came from Egypt, Syria, India, Iran, Russia and North Africa.Of course, there was a great deal of interest from real estate traders in the Gulf Co-operation Council too.The fact that so few buildings are bought via mortgages is encouraging, especially since the UAE Central Bank revealed plans to cap home loan limits.Emirates Banks Association chairman Abdul Aziz Al-Ghurair told the news provider that the changes are unlikely to have a huge effect on investors."People have speculated that it will be negative to real estate, [but] 70 per cent of the real estate sales [are] on a cash basis so it's going to impact 30 per cent [of the market]," he was quoted as saying.Earlier this month, Emirates 24/7 reported that the bank would not be in a position to introduce the restrictions until the end of 2013 anyway, so property buyers do have quite a bit of breathing space.Some experts are predicting a flurry of purchasing activity in the next 12 months, as those who are reliant on mortgages will complete their transactions before the caps are imposed.With prices expected to rise sharply again this year, the outlook for the UAE real estate sector - particularly in Dubai - is extremely positive.Looking for apartments for sale in Dubai? The First Group can help you out