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Delhi News Daily > Blog > World News > How Dubai residents with Dh15k-20k salary can now buy a Dh1 million house with ‘first home’ initiative | World News – Times of India – Delhi News Daily
World News

How Dubai residents with Dh15k-20k salary can now buy a Dh1 million house with ‘first home’ initiative | World News – Times of India – Delhi News Daily

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Last updated: July 3, 2025 9:47 pm
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Contents
Step 1: Determine Affordability and Choose the Right PropertyStep 2: Mortgage Breakdown and AffordabilityStep 3: Plan for Upfront Costs and FinancingStep 4: Maximize Program Benefits and Get Expert Support
How Dubai residents with Dh15k-20k salary can now buy a Dh1 million house with 'first home' initiative
Backed by 13 developers and 5 banks, the initiative helps Dubai residents earning Dh15,000 to Dh20,000 buy a home with up to 10% discounts and affordable mortgages (Representative image)

For many Dubai residents earning between Dh15,000 and Dh20,000 per month, owning a home has long seemed out of reach, especially with property prices frequently surpassing Dh1 million. However, Dubai’s new First-Time Homeownership Initiative, aimed at making homeownership accessible to first-time buyers, offers support for properties priced up to Dh5 million. Backed by 13 developers and 5 major banks, the program provides significant benefits, including priority access to new off-plan units, preferential pricing, and direct discounts of up to 10% on property prices. Additionally, the initiative offers flexible mortgage payment plans with better rates from participating banks, making homeownership more affordable. DLD registration fees can also be paid in interest-free instalments, easing the upfront financial burden. So, if you’re eyeing that Dh1 million home, here’s how you can plan your strategy, estimate your costs, and make the most of these benefits to bring your dream of homeownership closer to reality. With this initiative, even moderate-income earners can turn the goal of owning a home into a viable possibility.

Step 1: Determine Affordability and Choose the Right Property

Let’s say you’re earning Dh18,000 per month, placing you comfortably within the program’s targeted salary range. The First-Time Homeownership Initiative aims to make homeownership a reality for people like you, with homes priced up to Dh1 million eligible under the program. According to the common mortgage lending rule, banks typically recommend that no more than 30% of your monthly income should go towards housing costs (including both the mortgage repayment and associated property costs like maintenance and insurance).Here’s how we calculate this:

  • 30% of Dh18,000 = Dh5,400
    This means that, ideally, your monthly mortgage payment should not exceed Dh5,400.

Now, let’s consider the mortgage options available through this program. With 18-year loan tenures on offer, the total amount you can borrow will depend on the interest rate, which is among the lowest available to first-time buyers under this initiative.Now, let’s see how the First-Time Homeownership Initiative supports this.

Step 2: Mortgage Breakdown and Affordability

The program offers competitive interest rates, making homeownership more accessible for residents earning Dh15,000 to Dh20,000 per month. While typical mortgage rates in Dubai range from 3.5% to 4.5%, this initiative, backed by major banks and developers, provides below-market financing options. A 3.5% interest rate is realistic and competitive, ensuring affordable monthly payments for first-time buyers in the mid-income range.Assuming an interest rate of 3.5%, which is reasonable given the program’s supportive nature, here’s how the numbers break down for a Dh1,000,000 home:

  • Loan Amount: Dh900,000 (after taking the full 10% discount for estimate on the original property price of Dh1,000,000).
  • Interest Rate: 3.5% per annum
  • Loan Tenure: 18 years

Using the standard mortgage calculation formula, the estimated monthly payment comes out to be around Dh5,544 (precise), which is just slightly above the 30% salary rule. With Dh18,000 per month in salary, the monthly payment of Dh5,544 still remains manageable, offering a solid financial foundation for first-time buyers.

Step 3: Plan for Upfront Costs and Financing

While the program offers numerous benefits, it’s important to keep in mind the upfront costs, including the down payment and closing costs. As is typical in Dubai’s property market, you will generally need to make a 20% down payment on the purchase price. In case this requirement remains 20%, even with the initiative’s benefits, we’ve used this figure for a safe estimate. For a Dh1,000,000 property, this means a Dh200,000 down payment.

  • Initial Investment: Dh200,000
  • Discounted Property Price: Dh900,000 (after 10% discount)
  • Loan Amount: Dh700,000
  • Monthly original Payment: Dh5,544

If you’re able to make the upfront payment of Dh200,000, your loan amount will reduce to Dh700,000, bringing the monthly payment down to approximately Dh4,314 per month.Though the down payment may seem steep, there are several ways to manage this:

  • Savings: If you’ve been saving for a while, now is the time to use those funds for your home purchase.
  • Employer Assistance: Some companies offer home loan assistance or partnerships with financial institutions that may help with the down payment.
  • Personal Loans or Support: If necessary, you might consider a personal loan to cover part of the down payment, though this should be done carefully to avoid over-leveraging.

Step 4: Maximize Program Benefits and Get Expert Support

To make the most of the First-Time Homeownership Initiative, consider these tips:

  • Choose the Right Property: Stay within the Dh1 million price range to keep your mortgage payments manageable (under 30% of your salary).
  • Leverage Discounts: Use up to 10% discounts on property prices. For instance, if a home is priced at Dh900,000, you’ll only finance Dh810,000, reducing monthly payments.
  • Use Flexible Payment Plans: Opt for flexible payment plans on off-plan units that let you pay part of the cost upfront and spread the rest over time.
  • DLD Fee Benefits: Take advantage of the option to pay Dubai Land Department (DLD) registration fees in interest-free instalments, easing your upfront costs.
  • Work With the Right Broker: Partner with a licensed broker to find properties that match your budget and eligibility criteria.
  • Get Pre-Approved for Financing: Secure pre-approval from a participating bank to understand what you can afford and streamline the home-buying process.

Disclaimer: The figures provided are rough estimates, meant to illustrate how the First-Time Homeownership Initiative can make homeownership more accessible. Actual costs, discounts, and mortgage terms may vary based on factors such as bank policies, property specifics, and developer offers.





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