The UAE’s real estate mortgages market will top the Dh200-billion mark by the first quarter of 2010 at current growth rates, data shows.

An Emirates 24|7 analysis of mortgages extended by the country’s banks and key financial institutions in Dubai and Abu Dhabi shows that value of outstanding real estate loans currently hovers around Dh181 billion.

Of this, banks operating in the country shoulder almost 90 per cent, offering mortgages worth Dh162.19bn as of August 2010, according to recent statistics shared by the UAE’s central bank.

Two Dubai-based Islamic mortgage lenders account for another Dh18bn worth of mortgages among them, with Tamweel accounting for Dh9.67bn worth of loans (as of June 2010) and Amlak accounting for Dh8.38bn in financing and investing assets (as of September 2010). Launched in November 2008, Abu Dhabi Finance Company’s loan book amounted to around Dh1bn at the end of 2009, bringing the total to Dh181.24bn.

Official statistics by the Central Bank of the UAE show that despite the slowdown in the country’s property market, banks in the country have continued to extend mortgage loans, with such loans growing by Dh20.47bn at the end of August 2010.

According to Central Bank data, real estate mortgage loans extended by the country’s banks grew from Dh141.7bn at the end of 2009 to Dh162.2bn in August 2010, or 14.4 per cent in the first eight months of the year.

That works out to an average of approximately Dh2.56bn worth of additional mortgages extended every month of this year. Assuming that the months of September and October (data for which is yet to be published by the Central Bank) witnessed similar growth in mortgages, the current market size can be estimated at around Dh186bn.

At the current growth rate, then, it’ll take another five or so months for the UAE’s market to attain a size of Dh200bn, or by March-April 2010.

Mortgage growth in the UAE has slowed dramatically from the meteoric rates in 2007-2008, when mortgages extended by the country’s banks more than doubled in a year, from Dh56.47bn at the end of 2007 to Dh125.83bn at the end of 2008, clocking an annual growth rate of 123 per cent.

Since then, however, with the real estate sector impacted by the credit crisis, growth slowed down to 12.6 per cent in 2009 but is expected to recover to over 20 per cent this year.