UAE Base Rate Rises to 3.9%: First EIBOR Fixing and Dubai Mortgage Checklist

1. What changed on 17 September 2026?

On 16 September, the Central Bank of the UAE announced that the Base Rate applying to its Overnight Deposit Facility would rise by 25 basis points, from 3.65% to 3.90%, effective Thursday, 17 September 2026. It kept the rate for short-term liquidity borrowed through its standing credit facilities at 50 basis points above the Base Rate.

The decision followed the US Federal Reserve’s increase in the interest rate paid on reserve balances to 3.90%, also effective 17 September. CBUAE explains that its Base Rate is anchored to that US rate and signals the general stance of UAE monetary policy.

These facts establish a policy-rate change. They do not establish a new rate for every mortgage, refinancing offer or Islamic home-finance contract. A customer’s result still depends on the signed pricing formula, any fixed period, the benchmark tenor, the margin and the contractual reset date.

References: CBUAE — official homepage listing the Base Rate decision, 16 September 2026 · WAM — CBUAE raises the Base Rate from 3.65% to 3.90% · Federal Reserve — implementation note, 16 September 2026

2. What the first 17 September EIBOR fixing shows

CBUAE’s official table now includes EIBOR fixings dated 17 September 2026. Comparing those entries with 16 September shows different movements across the six published tenors. Overnight EIBOR increased from 3.407350% to 3.654850%, while three-month EIBOR increased from 4.128770% to 4.214590%. Twelve-month EIBOR moved from 4.811030% to 4.954470%.

The comparison below is a DR calculation using the two official rows. The basis-point change equals the 17 September percentage rate minus the 16 September percentage rate, multiplied by 100. Figures are rounded to two decimal places. The two rows also carry different value dates, so this is a comparison of consecutive published fixings rather than a claim that the underlying transactions have identical settlement dates.

The evidence does not support saying that every EIBOR tenor rose by 25 basis points or that the Base Rate mechanically caused every observed movement. Benchmarks reflect their own tenor and market inputs. One official fixing is also not a trend. It is a dated observation that should be read alongside later fixings and the customer’s actual contract.

References: CBUAE — official EIBOR data, including 16 and 17 September 2026 fixings

3. Keep the Base Rate, EIBOR and your mortgage rate separate

The CBUAE Base Rate is the UAE’s official monetary-policy rate and provides a floor for overnight money-market rates. EIBOR is a separate interbank benchmark published for specified tenors. CBUAE notes that EIBOR is used as a reference in financial transactions including some mortgages.

Your contractual customer rate is a third figure. It may be fixed, variable or fixed for an introductory period before becoming variable. A variable formula might use a named EIBOR tenor plus a lender margin, but the controlling formula is the one in the signed finance documents and any valid amendments.

The 17 September overnight fixing of 3.654850% is therefore not inconsistent with a 3.90% Base Rate, and neither figure should be substituted for a customer quotation. Record the precise benchmark tenor, observation date and margin stated in your documents.

References: CBUAE — Monetary Policy and Domestic Markets · CBUAE — official EIBOR rates and history

4. Who may notice a change—and when?

A borrower inside an agreed fixed-rate period should begin by checking when that period ends rather than assuming an immediate payment change. A borrower on a variable rate should identify the benchmark tenor, margin, review frequency, observation date and next effective reset date.

A new buyer should compare the rate-lock language, offer validity, approval conditions, fees and the formula that applies after any introductory period. An approval in principle or advertised starting rate is not an unconditional promise that the same price will remain available at a future handover.

Shari’ah-compliant home finance may use profit-rate terminology and a different contractual structure. The same evidence discipline applies: identify whether pricing is fixed, variable or combined, how it is calculated and when it can be revised. Product-specific questions should go to the financing institution and, where needed, an appropriately qualified adviser.

References: CBUAE Rulebook — Consumer Protection Standards · CBUAE Rulebook — disclosure and transparency requirements

5. Use this seven-field mortgage check

The following is a Development Resolution working checklist, not a replacement for the lender’s Key Facts Statement or contract. Copy each answer from the relevant document, record its date and keep unresolved points visible.

References: CBUAE Rulebook — fixed, variable and reference-rate disclosures

6. Illustration: what would full 25-basis-point pass-through look like?

This is a hypothetical repayment model, not a forecast of any lender’s action and not a calculation from the EIBOR table. Assume a reducing-balance mortgage has 20 years remaining, monthly principal-and-interest payments, no fees or prepayments and a customer rate that moves immediately from 4.50% to 4.75%.

Under those assumptions, a remaining principal of AED1 million produces an illustrative monthly payment increase of about AED135.74. Doubling the principal doubles the modelled change because the assumed rate and remaining term stay the same.

A real result can differ because the balance, term, benchmark tenor, margin, reset date, payment frequency, caps, floors, fees and product structure may differ. A lender may change an instalment, term or another feature only as permitted by the agreement and applicable requirements.

References: CBUAE Rulebook — variable-rate impact illustrations and reducing-balance disclosure

7. A current off-plan example shows why conditions matter

On 15 September 2026, Dubai Holding Real Estate and ADCB announced a project-specific financing programme for eligible clients. The announcement described financing after 50% of the property value had been paid for specified communities, pre-approvals valid for up to 18 months and pricing from 3.49% fixed for three years, subject to programme terms.

This is a reading example, not a market benchmark or endorsement. The starting price, three-year fixed period, 18-month pre-approval and 50% payment condition answer different questions. A buyer still needs the current Key Facts Statement, total-cost information, eligibility decision, post-fixed pricing formula and drawdown conditions.

Terms can change after publication. Anyone considering that or another programme should obtain current documents directly from the relevant licensed institution and should not treat this article as a finance offer.

References: WAM — Dubai Holding Real Estate and ADCB financing announcement, 15 September 2026 · CBUAE Rulebook — advertising and disclosure standards

8. If the project is delayed, compare two timelines

An off-plan purchaser may have a developer payment schedule, projected handover date, finance approval and indicative or fixed offer that do not expire together. A change in the project timetable can create a financing problem even when the buyer’s current instalment has not changed.

Prepare two dated lines. The project line should show construction and handover evidence, payment milestones and unresolved developer or authority information. The finance line should show approval expiry, valuation conditions, drawdown requirements, fixed-period dates, the named EIBOR tenor and the first possible repricing date.

A finance approval does not establish project completion, and a project progress entry does not establish that a lender must release funds. Ask each responsible party to confirm the condition it controls, and preserve earlier offers and notices so changes remain traceable.

9. Project funding models need a dated rate sensitivity

For a stalled-project completion proposal, the relevant question is not whether the Base Rate or one EIBOR tenor rose in isolation. The model should identify each funding line as fixed, variable, indicative, committed or still unarranged, together with the applicable benchmark, margin and reset rule.

DR recommends adding a transparent sensitivity with a stated borrowing amount, drawdown schedule, benchmark tenor, margin and calculation period. Do not apply a 25-basis-point increase to cash, purchaser receipts or fixed funding merely to make a model appear conservative.

Keep financing-cost changes separate from construction scope, remediation and other remaining uses. That makes it possible to identify whether a funding gap changed because of price, timing, scope or finance. Update the model only when an assumption or evidence source changes.

10. What borrowers and buyers should do now

Start with documents rather than predictions. Obtain the signed contract, current statement, Key Facts Statement, latest lender notice and any valid offer or pre-approval. Mark the current customer rate, reference-rate tenor, margin, observation date, reset date, remaining balance and term.

If the product is variable or approaching a reset, ask the lender for a written illustration. Compare both the next instalment and the total remaining cost. If refinancing is proposed, compare the existing and replacement facilities on consistent assumptions, including fees and any early-settlement consequences.

Do not circulate complete bank statements, identity records or finance agreements in an open owner group. If a delayed project is involved, keep personal finance evidence in the private owner file while sharing only project-wide questions that genuinely require coordination.

• Record the source, tenor and date of every benchmark rate used.
• Confirm whether pricing is fixed, variable or combined.
• Identify the exact EIBOR tenor if the contract refers to EIBOR.
• Check the contractual observation and reset dates.
• Request the post-fixed-period formula before comparing offers.
• Stress-test the payment with the actual balance and remaining term.
• Seek appropriately qualified advice if affordability or contractual rights are in doubt.

References: CBUAE Rulebook — Consumer Protection Standards

11. What to watch after the first fixing

Watch the lender communication relevant to your contract, not only the next policy headline or a single benchmark row. For a variable facility, the meaningful sequence may be publication of the applicable tenor, the contractual observation date, the lender’s notice and the effective date of a revised payment.

Later EIBOR fixings may move in either direction and different tenors may continue to diverge. New fixed offers can also reflect funding costs, competition, risk, fees and eligibility rather than the Base Rate alone.

The evidence-based conclusion on 18 September is limited but useful: the UAE Base Rate is 3.90%; the first dated EIBOR fixing after implementation showed uneven increases across the published tenors; and each customer must still establish whether a benchmark reaches their product, through which formula and on what date. This article provides general information, not individual financial or legal advice.

References: CBUAE — official EIBOR data · CBUAE — benchmark-rate framework