Equity Release for Home Improvements: How to Unlock Your Home’s Potential in the UAE

Your home in the UAE is more than just where you live—it’s also an asset you’ve likely built equity in. If you’re planning to renovate your kitchen, extend your living space, or refresh your home, using equity release for home improvements could be a smart and efficient way to fund your projects without moving.

In this comprehensive guide, we’ll walk you through how equity release works, the latest UAE rules, the pros and cons, and expert tips to help you renovate with confidence.

What Is Equity Release in the UAE?

Equity release lets homeowners access cash tied up in their property without selling or relocating. Essentially, you borrow against the “equity” — the difference between your home’s current market value and any outstanding mortgage.

Unlike a traditional home sale, equity release gives you cash while you continue living in your home. The available funds can be given as a lump sum, line of credit, or structured loan, depending on the lender.

How Does Equity Release for Home Improvements Work?

If you’re considering equity release for home improvements, here’s how it works in the UAE:

• Property Valuation: The bank values your property.
  
  
• Calculate Equity: Subtract your mortgage balance from the current market value.
  
  
• Acceptable LTV: UAE banks typically allow up to 80% LTV for residents; some offer up to 75% for expats.
  
  
• Borrow Cash: Use the released funds for approved purposes like renovation.
  
  

You retain home ownership and continue living there while using your equity to enhance it.

Recent Trends in the UAE

UAE homeowners are increasingly choosing equity release for home improvements, especially with rising property values and competitive mortgage rates. Many banks now offer flexible 25-year terms, even for those still repaying their mortgage, under structures like “buyout plus equity.”

Benefits of Equity Release for Home Improvements

Access Cash Without Moving

Keep living in your home while tapping into its value—no need to sell or downsize.

Lower Interest Rates

Since your home backs the loan, rates are often lower than personal loans.

Flexible Borrowing Options

Draw cash as a lump sum or line of credit—ideal for staged renovations.

Value-Add for Your Home

Well-planned home improvements funded through equity release may increase property value—raising your overall net equity later.

Preserve Creative Freedom

You choose how to spend the money—just ensure it aligns with bank-approved purposes.

Drawbacks to Consider

Impact on Estate

Equity release reduces what your heirs inherit since the debt must be settled later.

Interest Can Accumulate

Some products roll up interest over time, increasing total costs.

Market Risk

If property values fall, your remaining equity could shrink—though many equity plans have “no negative equity” guarantees.

Strict Eligibility

Banks assess age, income, property value, and purpose. Typically, the equity must be used for home upgrades or new property purchases.

Eligibility Checklist for Equity Release

Criteria	Guidance for UAE Homeowners
Property Value	Must have built sufficient equity
LTV Limit	Generally up to 75-80%
Purpose	Home improvements or new property only
Age Restrictions	May apply depending on lender
CB Affordability	Must pass income and debt checks

Step-by-Step: Equity Release for Home Improvements

1. Book a Valuation

Get an updated market value of your property.

2. Calculate Available Equity

Factor in outstanding mortgage and lender’s LTV limit.

3. Speak to Mortgage Finder

We’ll analyze your options, compare lenders, and ease paperwork and negotiation.

4. Choose Loan Type

Decide between lump sum, line of credit, or remortgage plus equity.

5. Finalize Loan and Projects

Draw the funds and oversee renovations. Be sure to shop and budget carefully.

Frequently Asked Questions

Q: Can you release equity even with an existing mortgage?
Yes—many banks offer “buyout plus equity” loans.

Q: What purposes are allowed for equity release?
Only home improvements or property purchases—personal cash outs are restricted.

Q: What’s the typical interest rate?
Rates are generally around 4% in 2025, competitive compared to unsecured loans.

Q: What loan term is available?
Often up to 25 years, aligned with standard mortgage terms.

If you’re planning renovations and have equity in your home, using equity release for home improvements in the UAE can be a cost-effective, flexible way to fund them—without moving or exhausting your savings.

At Mortgage Finder, we’ll help match you with the best equity release products in the UAE, guide you through the process, and ensure the result aligns with your lifestyle and financial goals.

Ready to make your home shine? Contact Us for a personalized equity release assessment today.