Low interest rates in Abu Dhabi raise interest rates

Dubai’s more financially secure neighbour, Abu Dhabi, is becoming increasingly appealing to investors with yet another incentive on the way to make real estate in the UAE even more attractive.

Abu Dhabi Finance has announced it is going to cut mortgage rates in the emirate to an unbeatable 5.75% for home buyers. The mortgage provider is partly government owned and funded and it’s this funding which is allowing the company to undercut the market.

The best deal on the table up until this announcement was a rate of 6.5% but this move will no doubt see Abu Dhabi Finance clawing the lion's share of the market. The emirate has enjoyed a more stable financial environment thanks to its huge oil industry, unlike property in Dubai which has grown up in main around the financial services industry, which has of course suffered terribly of late.

In the most uncertain of times, investors were buying into the safe option and Abu Dhabi’s popularity grew. This new lower interest rate may well have an invigorating effect yet again.