Homebuyers in the United Arab Emirates now have more options for financing properties that are under construction. Banks are expanding their products to allow clients to receive loans and make payments according to the stages set by developers.
Dubai Islamic Bank (DIB) has launched a new product for financing off-plan housing, enabling UAE citizens, residents, and non-residents to secure financing up to 50 percent of the property's value. Concurrently, Abu Dhabi Commercial Bank (ADCB) has partnered with Ellington Properties to offer a similar pre-approved financing solution for both ready and off-plan properties from this developer.
These steps come as off-plan property sales continue to constitute a significant portion of transactions in the Dubai housing market, offering buyers additional financial options before the transfer of ownership.
Financing through DIB
Under DIB's new Sharia-compliant product, the bank will gradually disburse funds to developers based on the achievement of construction milestones. During the construction period, buyers only pay the profit percentage, which increases as additional payments are made to the developer.
The full monthly payment, including principal and profit, begins either upon handover or within 24 months of receiving financing, whichever comes first. DIB stated that this product is available for freehold properties from developers across the UAE and provides financing up to 50% of the property's value. Furthermore, the bank is exploring cooperation with developers to expand access to this option within large freehold projects.
ADCB Offers Renewable Pre-Approval
Separately, ADCB has teamed up with Dubai developer Ellington Properties to offer suitable buyers pre-approved financing for both off-plan and ready properties. When purchasing an off-plan property, buyers can receive pre-approval for up to 50% of the property's value. This pre-approval is valid for one year and can be renewed annually until the keys are handed over, allowing buyers to secure financing for stage payments and upon property handover as construction progresses.
For a limited time, eligible buyers can also benefit from ADCB financing rates starting from 3.49 percent per annum, fixed for three years, with both the bank and the developer announcing the waiver of arrangement and valuation fees. This partnership applies to Ellington residential projects in Dubai.
Although the two offers differ in financing structure, both aim to solve one of the problems associated with buying property before completion—namely, financing payments during the construction period, not just at handover. For buyers, this can provide greater transparency regarding the available financing amount, as developers require payments at different construction stages. The expansion of such products occurs against the backdrop of off-plan properties remaining a vital part of the Dubai housing market, attracting buyers through payment plans and ongoing development projects across the emirate.