# New restrictions in the UAE mortgage market



## Elphaba (Jan 24, 2008)

Info here: News: Further restrictions on UAE mortgages | Financialuae's Blog


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## Chocoholic (Oct 29, 2012)

Probably a good thing! I suspect many expats will get mortgages from their home countries, which would then cover them if there are any issues.


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## Elphaba (Jan 24, 2008)

Chocoholic said:


> Probably a good thing! I suspect many expats will get mortgages from their home countries, which would then cover them if there are any issues.


You cannot borrow from outside the UAE and have the loan secured on a UAE property. A bank will not lend cross border in that way as they are at to much risk and it's not legally possible, unless they also have an operation in the UAE. The only option would be to borrow against a property in a home country to raise a further deposit, or to buy cash.

Whilst I believe the move is designed to prevent another housing bubble, I still don't recommend buying in the UAE.


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## zed_kid (Sep 25, 2012)

Elphaba said:


> You cannot borrow from outside the UAE and have the loan secured on a UAE property. A bank will not lend cross border in that way as they are at to much risk and it's not legally possible, unless they also have an operation in the UAE. The only option would be to borrow against a property in a home country to raise a further deposit, or to buy cash.
> 
> Whilst I believe the move is designed to prevent another housing bubble, I still don't recommend buying in the UAE.


So I could get an equity loan back at home secured by my property there and use that as a 20% deposit for a house here? Or am I dreamin’


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## Elphaba (Jan 24, 2008)

zed_kid said:


> So I could get an equity loan back at home secured by my property there and use that as a 20% deposit for a house here? Or am I dreamin’


Theoretically yes, provided you have sufficient equity in the current property and can raise funds for a 50% deposit here, as well as having enough to cover all the charges. That's assuming you really think that buying in the UAE is a good idea..

.


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## dubaisky (Aug 9, 2010)

Do current mortgages remain unchanged ? Thank you


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## Elphaba (Jan 24, 2008)

dubaisky said:


> Do current mortgages remain unchanged ? Thank you


I have a copy of the Central Bank announcent and it doesn't say much and makes no reference to existing mortgages. I very much doubt they would make it retroactice as it's just not feasible to expect people to repay part of an existing mortgage. 

I cannot say for certain, but I do not believe existing mortgages will be affected.


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## dubaisky (Aug 9, 2010)

Thanks Elphaba ... lets hope so


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## Saibz (Dec 31, 2012)

Does anyone have any idea whether those people who have APPLIED for a loan BEFORE this new rule was issued will have to pay according to the new rule or according to whatever the rules were at the time of their application for the loan?


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## woodlands (Jan 13, 2010)

Think the rule will be suspended within 3 months when they realize it will kill the property market, prices fall 20% and transactions halve at best, more like 80% down. New developments don't sell etc.
Rents will go up like mad in prime areas though.


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## Elphaba (Jan 24, 2008)

Saibz said:


> Does anyone have any idea whether those people who have APPLIED for a loan BEFORE this new rule was issued will have to pay according to the new rule or according to whatever the rules were at the time of their application for the loan?


That has not yet been clarified, but I suggest you contact the bank who gave the approval to find out their policy.


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## saraswat (Apr 28, 2012)

Thanks for the info .. I personally think this is a good development.. Should help things from going nuts all over again ...


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## Londoner-2012 (Jul 31, 2012)

*New limits on mortgages to expats!*

Out of nowhere....


U.A.E. Limits Mortgages to Foreigners at 50% of Home Value - Businessweek

The United Arab Emirates plans to restrict mortgages for foreigners to 50 percent of the property’s value, threatening to derail a nascent recovery in Dubai home prices after more than three years of declines.

U.A.E. citizens can get as much 70 percent of the value of a first house and 60 percent for a second, according to guidelines issued by the central bank and obtained by Bloomberg News. Foreigners can get mortgages of as much as 40 percent of the value of a second property, according to the document. The central bank’s public relations department declined to comment when contacted by Bloomberg News today.

“In the short term, it’s a negative because it will stop the hike in real estate prices that we’ve seen so far,” Tariq Qaqish, deputy head of asset management at Dubai-based Al Mal Capital PSC, said by telephone. “Since most buyers these days are end-users, you might see prices decline because not everyone can afford to put in a 50 percent down payment.”

Dubai’s real estate market is showing some signs of recovery after prices plunged 65 percent since the onset of the global credit crisis. Dubai’s ruler in November announced developments including a new district that includes the world’s biggest shopping mall and a complex of five theme parks.

Tighter lending restrictions imposed by the Abu Dhabi-based U.A.E. central bank this year may act as a brake on the rise in home sales and prices in the second biggest Arab economy. Foreigners make up more than 80 percent of the population of the U.A.E., which includes Dubai and Abu Dhabi, according to government estimates.

Stocks Fall
Real estate deals in Dubai could slump 60 percent as “paucity of property finance deters end user from buying,” Digvijay Singh, a Dubai-based analyst at VTB Capital Plc, said in an e-mail today. Real estate prices could fall as much as 20 percent from current levels, declining 10 percent within six months, he said.

Emaar Properties PJSC (EMAAR), the developer of the world’s tallest tower, led Dubai real estate stocks lower with a 1.6 percent decline to 3.75 dirhams. The stock, which fell for the first time since Dec. 25, was priced at 3.78 dirhams as of 1:08 p.m. Builder Arabtec Holding Co. (ARTC) and property company Deyaar Development PJSC (DEYAAR) also fell.

‘Serious Buyers’
The central bank’s new lending restrictions “will contribute to strengthening the property sector by encouraging serious buyers to invest,” a spokesman for Emaar said in an e- mailed response to questions. “Emaar has recorded strong response to its property launches this year, and we expect the trend to continue in 2013 by drawing on the positive growth of the economy and growing demand for homes in premium lifestyle communities.”

No date for implementing the new policy was given in the circular. There were no loan-to-value limits previously some banks lend as much as 90 percent of the property’s value.

“We will be in discussions with the central bank on the implications of the circular for mortgage lending and the real- estate industry and how the new rules will be implemented,” Suvo Sarkar, the head of retail banking at Emirates NBD PJSC (EMIRATES), the U.A.E.’s biggest bank by assets, said by phone yesterday.

Dubai, home to the world’s tallest tower, first allowed foreigners to own property in 2002, drawing investors from Iran, India, Pakistan and Russia. Many made quick profits by paying a developer 10 percent of a planned property upfront and then reselling the contract as values rose at the fastest pace in the world. Many developers in the emirate were paralyzed when buyers failed to make further payments to complete the properties after the credit crisis.

End Users
After the property crash that followed, lenders and developers focused on investors that plan to live in the homes they purchase rather than speculative buyers.

In the long run, yesterday’s regulations will be “positive because we’ve seen the market go back to its old habits before the crisis, and this will help keep inflation in check,” Qaqish at Al Mal said. “Ultimately, more end-users will be able to afford to buy properties here and the economy will benefit.”

Property prices in Dubai have crept up this year as the economy recovered and banks revived mortgage lending. Prices in the emirate, the second-biggest of seven that make up the U.A.E., were also helped by its so-called safe-haven status amid the pro-democracy protests sweeping much of the Arab world.


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## xabiaxica (Jun 23, 2009)

Londoner-2012 said:


> Out of nowhere....
> 
> 
> U.A.E. Limits Mortgages to Foreigners at 50% of Home Value - Businessweek
> ...


not quite out of nowhere 

http://www.expatforum.com/expats/du...875-new-restrictions-uae-mortgage-market.html


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## saya123 (Dec 11, 2008)

i personally think it will kill the market.. i dont think they have thought this through completely.

if the objective was to introduce this in order to curtail the speculative investors and promote the end use / real buyers.. i think it will do just the opposite. in my view, hardly any of the end users will be able to put in 50% upfront from their own pocket.. look at the prices of 2 beds in general.. nothing decent is available below 1m so we are talking about half a million from your own pocket.. i dont think any of the professional class (who are generally the ones opting for finance option) will be able to put this much in by themselves.

on the other hand, speculators or the investor class are generally those who dont opt for financing.. they have free cash for investing either in ready properties or they go for payment plans for unfinished properties and since the intention is to flip it over as soon as they make an upside, they wouldnt be interested in getting into the formalities of leasing and then getting the release letters etc.

dont know what you all think but i think its the worst decision ever.. especially when market was just on the brink of recovering.


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## rsinner (Feb 3, 2009)

don't worry - there will be a "clarification" soon enough.
In the mean time, at least the good thing is that not-so-nice people like my previous landlord will be stuck with a place which they cant sell for a profit.


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## Mr Rossi (May 16, 2009)

saya123 said:


> i personally think it will kill the market.. i dont think they have thought this through completely.


I think they've thought this through quite adequately when they realised a lot of property bought these days is by people looking to get their wealth out of their volatile home countries - Syria, Afghanistan, Pakistan and then places like Russia.

While these people may be cash rich (and can afford the 50%) they are also a larger credit risk, so it's a shrewd move by the lenders.

The fall out is the average family with a 10-15 year plan can't afford to buy a two bed in The Springs but I'm sure someone, somewhere has crunched some numbers while the system was up.


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## saya123 (Dec 11, 2008)

Mr Rossi said:


> I think they've thought this through quite adequately when they realised a lot of property bought these days is by people looking to get their wealth out of their volatile home countries - Syria, Afghanistan, Pakistan and then places like Russia.
> 
> While these people may be cash rich (and can afford the 50%) they are also a larger credit risk, so it's a shrewd move by the lenders.


people that you are talking about were anyway not eligible for 80%+ financing.. they are non resident and they were not gettin the same level of financing as resident expats do.. im purely talking about the impact the decision is going to have real end users who live in dubai/uae!


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## Mr Rossi (May 16, 2009)

saya123 said:


> people that you are talking about were anyway not eligible for 80%+ financing.. they are non resident and they were not gettin the same level of financing as resident expats do.. im purely talking about the impact the decision is going to have real end users who live in dubai/uae!


The people I was talking about are Dubai residents from these countries that were eligible and previously investing back in their home countries. It's not my area of expertise and I don't have the figures to hand, but the general consensus seems to be that prices on The Palm, for example, have held and risen largely because of the Arab spring.


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## saraswat (Apr 28, 2012)

saya123 said:


> people that you are talking about were anyway not eligible for 80%+ financing.. they are non resident and they were not gettin the same level of financing as resident expats do.. im purely talking about the impact the decision is going to have real end users who live in dubai/uae!


True, this will undoubtedly price most people out of the market... but don't you think that is a good thing in the medium/long term? (not so much short-term).. which brings me to the point that there needs to be far more people with a long term view on the market for it to be efficient... With less properties changing hands due to 'yahoo finance' being available to one and all, there eventually has to be more price stability and correction in the market .. which ultimately bodes well for all types of investors...


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## saya123 (Dec 11, 2008)

i agree that the current situation does not in anyway look sustainable and we are again going towards the same situation as last time.. maybe even worse with so many work in progress inventory that is soon going to be coming live.. 

however whether this particular step is good or not is something im not convinced. however thats just me.. as you can see you and others have different opinions so i could be wrong.


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## Elphaba (Jan 24, 2008)

Londoner-2012 said:


> Out of nowhere.....



Not 'out of nowhere' as the Central Bank mentioned they were looking at this back in October.

I've added the thread you started to the one on the same topic I started several days ago. No need to duplicate when the info is already there.


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## hhl103 (May 3, 2011)

saraswat said:


> True, this will undoubtedly price most people out of the market... but don't you think that is a good thing in the medium/long term? (not so much short-term).. which brings me to the point that there needs to be far more people with a long term view on the market for it to be efficient... With less properties changing hands due to 'yahoo finance' being available to one and all, there eventually has to be more price stability and correction in the market .. which ultimately bodes well for all types of investors...


I agree with you

BAD for short term.
GOOD for long term.

This year, the price will stabilize or probably drop a little bit. But rent will surely go up faster as one previous replier pointed out. With this increase in rent, the rental yield is high enough to attract all those cash-rich, serious long-term investors all over the world. This process of changing hands (from end-users/small investors to cash-rich big investors) will take time and this process will automatically stabilize the market. 

These guys can hold onto the properties and just keep the rental yield high as they like. I don't see the property price to drop in the long run. Actually if the pool of cash-rich investors in the game is big enough, they have enough power to drive the property price up along with the increase in rents.

Just my thought here. 

p.s. In Hong Kong, government now has strict policy on mortgages, transaction has dropped a lot but the price still stay high. Mortgage cap doesn't necessarily create a fear in the market, if the demand is there.


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## hhl103 (May 3, 2011)

Saibz said:


> Does anyone have any idea whether those people who have APPLIED for a loan BEFORE this new rule was issued will have to pay according to the new rule or according to whatever the rules were at the time of their application for the loan?


I did what you were talking about. I applied 2 weeks ago. The bank rep told me that there is no real confirmation and clarification on the implementation date, or whether it is mandatory or just a recommendation. So he said the old rule still applies for my pre-approval.

I heard that there will be a big meeting between the central bank and all bank officials to talk about it. Probably some modification or clarification will be announced shortly. I asked a few agents and my bank rep, they said it is likely that the central bank will hold back on it. Or they will relax the cap on the first property, fix the cap on the second property. 

Anyway, I have no fear as a long-term investor.


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## hhl103 (May 3, 2011)

saya123 said:


> i personally think it will kill the market.. i dont think they have thought this through completely.
> 
> if the objective was to introduce this in order to curtail the speculative investors and promote the end use / real buyers.. i think it will do just the opposite. in my view, hardly any of the end users will be able to put in 50% upfront from their own pocket.. look at the prices of 2 beds in general.. nothing decent is available below 1m so we are talking about half a million from your own pocket.. i dont think any of the professional class (who are generally the ones opting for finance option) will be able to put this much in by themselves.
> 
> ...



I don't call those who are cash buyers speculators. If they are so rich in cash, speculation doesn't earn much (10% increase in price will make a less than 10% profits, as there is 2% transaction cost, 2% agent fee). Speculators are those who pay like 15% of the property value and hope to flip it in a few months. (a 5% increase in property price will make a 30% profit for them, due to the leverage)

I can only say that now cash is king. Those who have cash will take the chance to bargain hard on the sellers who want to sell quickly. 

It would be more practical to relax the cap on the first property and fix the cap for the second one onwards. It will benefit the end-users. This rule is now killing the end-users but still good for long-term investors.


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## Londoner-2012 (Jul 31, 2012)

This is a good thing as it slows down the second crash coming any minute now after the crazy short term spike coz of temporary influx of assets from arab spring countries...2 bedroom flats in palm hitting 3.8 million or a million dollars is crazy, so is 1500 people queuing to buy an offplan project to be completed in 4 years! Especially in a country some expats fled in the crisis leaving cars and loans behind...

They should implement this decision asap and make it 50pct for locals too...


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## hhl103 (May 3, 2011)

Elphaba said:


> You cannot borrow from outside the UAE and have the loan secured on a UAE property. A bank will not lend cross border in that way as they are at to much risk and it's not legally possible, unless they also have an operation in the UAE. The only option would be to borrow against a property in a home country to raise a further deposit, or to buy cash.
> 
> Whilst I believe the move is designed to prevent another housing bubble, I still don't recommend buying in the UAE.


Yes you are right in the first paragraph. 

Thanks for your opinion in the second paragraph. I actually think now it is safer to buy, as a buy-to-let property.


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## Felixtoo2 (Jan 16, 2009)

Safer to buy, are you joking. Not for the first time oriole with mortgages and those planning on buying have been, lets be honest, completely screwed by a bunch of individuals in a way that could never happen in a first world country. Have we already forgotten that a couple of years back people with fixed rate mortgages were royally shafted when one day a nameless bank said, oh we've changed our minds and we aren't gonna do this anymore. 
I really can't see how this is any good for the housing market and believe it can only lead to a further decline in a market that was recovering.
Which expat in their right minds would think long term about Dubai property when recent rule changes have only proved the instability of the market here.


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## hhl103 (May 3, 2011)

Felixtoo2 said:


> Safer to buy, are you joking. Not for the first time oriole with mortgages and those planning on buying have been, lets be honest, completely screwed by a bunch of individuals in a way that could never happen in a first world country. Have we already forgotten that a couple of years back people with fixed rate mortgages were royally shafted when one day a nameless bank said, oh we've changed our minds and we aren't gonna do this anymore.
> I really can't see how this is any good for the housing market and believe it can only lead to a further decline in a market that was recovering.
> Which expat in their right minds would think long term about Dubai property when recent rule changes have only proved the instability of the market here.


Thanks for your opinion.

No point to argue as we don't have the crystal ball to foresee the future.

We will wait and see what is going to happen in the next 10 years.


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## saraswat (Apr 28, 2012)

Felixtoo2 said:


> Which expat in their right minds would think long term about Dubai property when recent rule changes have only proved the instability of the market here.


I agree with everything you've said.. but talking about other market's, it is not usual for a relatively big investment to be made with a long term focus? A decent property in Dubai, in a decent neighborhood, one with all the amenities, imo, is a pretty significant chuck of change per all standards (USD, EURO, Sterling etc)... Because of easy finance, most people jumped onto the bandwagon when the going was good and then immediately got off (stuck it to the bank as it were).. Making someone put down 50% towards the property is surely going to prevent people from parking their belongings at the airport and hopping onto a plane... The other major thing that needs to be done, in lieu of stability is the whole visa/permit deal.. they need to get some sort of compromise/framework around that.. the current 3 yr renewable visa deal isn't long enough/worth it really ...


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## itisalok34 (Jan 8, 2013)

I agree that demand for apartments would go down and it would have direct impact on entire mortgage industry - property prices/rentals/jobs...

It's best to keep the decision on hold if you are planning to buy the property until a clarity comes on this rule from CB.


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## vantage (May 10, 2012)

Londoner-2012 said:


> This is a good thing as it slows down the second crash coming any minute now after the crazy short term spike coz of temporary influx of assets from arab spring countries...2 bedroom flats in palm hitting 3.8 million or a million dollars is crazy, so is 1500 people queuing to buy an offplan project to be completed in 4 years! Especially in a country some expats fled in the crisis leaving cars and loans behind...
> 
> They should implement this decision asap and make it 50pct for locals too...


one of the big influxes now is European money, as well as Arab Spring money.
Europe is toxic, and Switzerland is getting over-loaded. There are lots of welathy Europeans looking to park hefty sums of cash here at the moment.


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## vantage (May 10, 2012)

those using Dubai as a place to park their cash due to troubles at home ar enot affected by this. They aren't seeking mortgages, and are buying outright. 
The big property buyers and speculators will not be affected.
It is the 'little guy' wanting a house for his family that will be hurt.

The adjustmet makes sense in principle, but the scale of it is massive. Too much, too soon. It will have too big an impact / ripple effect, rather than a stabilisation.

No-one wants to see the 110% mortgages that were available in the UK for short while, but 50% is a cut too far. I think 30% deposit is a fair target.

Also, what are the banks going to do with existing mortgages? You can bet terms will change, and people will get held to ransom, as they are not in a position to re-mortgage.


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## z0rro (Jan 8, 2013)

vantage said:


> those using Dubai as a place to park their cash due to troubles at home ar enot affected by this. They aren't seeking mortgages, and are buying outright.
> The big property buyers and speculators will not be affected.
> It is the 'little guy' wanting a house for his family that will be hurt.
> 
> ...


Exactly, people with suitcases full of money can still buy it's end users that will be hurt. 50% down is incredulous given that we have seen a 35% increase in values of prime developments since Jan 2012. I don't think 50% will remain but it sends a signal. There has not been an LTV maximum laid down before, but following the crash banks have set themselves better and actually do credit checks and have salary criteria hurdles etc.

Having said that the banks have been edging from 70% to 85% over 2012 but at to cut it to 50% for your first property and 40% for the second has caused some fear to spread. Sunday's meeting doesn't seem to have produced a solution, the last I heard was that the banks were asking for 30 days delay and an LTV of 60% despite the fact that they have already cancelled approved mortgages. If the central bank said 75% on 1st and 50% on 2nd then people wouldn't be able to flip existing property in 2 months. 

Talking about flipping, it has been the developers' own media strategy to pronounce that they have 1500 people queuing up to buy off plan that has added to the reasoning behind it. If the banks don't lend a person 10 mortgages at the same time then people can't overextend in a greedy attempt to flip properties in the "next big thing". How many people have lost out in sports city for example.
It's amazing if you look at it and think - how come The Villa has been built but Falcon City is still a desert. It could have gone either way.

The second crash wouldn't have been coming if banks look at earnings v mortgage payments. If you or I buy a property with cash then the bank doesn't care until someone else wants to buy that property or the one next door with a mortgage. If they only earn X per month and the repayments on an 85% mortgage are going to be excessive given that income then the bank shouldn't grant the mortgage, therefore the sale won't go through and the MOU expires and the value is not cemented.

There is no telling what people with money are willing to spend it on. Market Value is what a property should exchange for between a willing seller and a willing buyer with proper marketing, acting knowledgeably and prudently without compulsion. Do I spend 35-40m buying a penthouse in Le Reve, or 35m in Emirates Hills or the Palm. If I've got the cash and I've got the need then I will do whatever I want but obviously I don't want to lose money but as long as there are people like me in the world and prime developments then I'll be alright.


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## woodlands (Jan 13, 2010)

I think there is no reason for alarm..
1/ Dubai real estate is the cheapest in the world when u compare infrastructure and macro prospects.
2/ Several places in the world have such stringent ltv's but it won't dampen price rises ... Look at Hong Kong, South Korea etc.
3/ you would have a major disruption for 12 months and then things will move higher again
4/ even these measures would be partially rolled back and higher ltv's would be available from what is forthcoming from central bank
5/ those who think high ltv's prevent crazy asking prices, remember the guys who ask for crazy prices are the ones who couldn't care less if their unit remained empty ...loaded with cash 
6/ those who look at marina and say "it's all empty" should go and see Chelsea mansions, empty until the oligarchs come to party.
7/ and if the ltv limits are revised upward we will see a rush to buy and a spike in prices ...
8/ key issue is security and Iran conflict.... If you feel comfortable with that risk, dxb real estate is an awesome investment.


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## hhl103 (May 3, 2011)

woodlands said:


> I think there is no reason for alarm..
> 1/ Dubai real estate is the cheapest in the world when u compare infrastructure and macro prospects.
> 2/ Several places in the world have such stringent ltv's but it won't dampen price rises ... Look at Hong Kong, South Korea etc.
> 3/ you would have a major disruption for 12 months and then things will move higher again
> ...




I agree with almost all your points. That's why I am putting my money here.


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## hhl103 (May 3, 2011)

I am predicting that the mortgage rate will drop further as the banks now are full of cash and they want more customers to borrow their money. 

With this mortgage cap, to attract more customers, they will further decrease the mortgage rate in order to stay competitive in the market. Or they will need to be creative in making offers to attract end-users.

In any case, the mortgage cap makes the market more stable and healthy in the long run.


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## Elphaba (Jan 24, 2008)

woodlands said:


> I think there is no reason for alarm..
> 1/ Dubai real estate is the cheapest in the world when u compare infrastructure and macro prospects.
> 2/ Several places in the world have such stringent ltv's but it won't dampen price rises ... Look at Hong Kong, South Korea etc.
> 3/ you would have a major disruption for 12 months and then things will move higher again
> ...



Your point number 1 must be a joke. Absolutely not true. No 8 is laughable too. It's comments like this that are responsible for the last bubble.

Caveat emptor...


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## Canuck_Sens (Nov 16, 2010)

Just logged in because I read your thread and I thought it deserved a response



woodlands said:


> I think there is no reason for alarm..
> 1/ Dubai real estate is the cheapest in the world when u compare infrastructure and macro prospects.


WRONG. Check Canada, US, India and Brazil. They are BY FAR CHEAPER. The First two boast a pretty good infra. Return on capital gains are good. The only thing is TAX. There are other countries that re moving to investment grade. These are pretty damn good too.



woodlands said:


> 2/ Several places in the world have such stringent ltv's but it won't dampen price rises ... Look at Hong Kong, South Korea etc


I find amazing people are making a big BUZZ about the Loan to Value Ratio. The decision made had the purpose to cool down demand and put the breaks on real estate prices. The effect is lagging. Check Canada on this, they introduced a greater LTV and prices started going down slowly. 

Unfortunately in this country when prices go up, they go crazily up 



woodlands said:


> 3/ you would have a major disruption for 12 months and then things will move higher again


It will move in one point up but not that higher. People gotta save. Either those with deep pockets buy more or else. UAE is BIG and I frankly see no reason for deep pockets persons to invest here unless they are coming from specific countries (i.e. Russia, Iran and etc...)



woodlands said:


> 4/ even these measures would be partially rolled back and higher ltv's would be available from what is forthcoming from central bank


I frankly hope that the CBUAE dont go back. A regulator that keeps going back is bad. And only in this country banks think they should be consulted first that's a joke. I actually had a tremendous laugh on the "rule of conduct"



woodlands said:


> 5/ those who think high ltv's prevent crazy asking prices, remember the guys who ask for crazy prices are the ones who couldn't care less if their unit remained empty ...loaded with cash


They are designed to prevent and will affect most people. Of course those with money dont care it does not matter I think that statement is pretty obvious and therefore your comment is useless.



woodlands said:


> 6/ those who look at marina and say "it's all empty" should go and see Chelsea mansions, empty until the oligarchs come to party.


With several owners who could not demonstrate the ORIGIN of their funds. GREAT!



woodlands said:


> 7/ and if the ltv limits are revised upward we will see a rush to buy and a spike in prices ...


Yeah that is obvious so ???



woodlands said:


> 8/ key issue is security and Iran conflict.... If you feel comfortable with that risk, dxb real estate is an awesome investment.


The key issue is not the conflict, but the law. The legal framework is a mess hands down. See how many people complained about banks changing the rules of their mortgages on the fly. It is all over the place. They wrote one thing and executed a different one.

What about if an investor cannot come to Dubai if they change again the VISA rules. They keep changing all the time.


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## VitaEsMorte (Apr 26, 2010)

I appreciate the will of the CB. However, it seems like they just wanted to put end-users away, not speculators. 

I luckily completed my mortgage deal just three weeks before new regulations. If new regulations had been issued previously, I couldn't have afforded my house. 

Another thing is, through the same agent, a foreign investment bank bought 10 units in the same apartment in cash! I believe, investors do not need so much bank finance?


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## woodlands (Jan 13, 2010)

Sorry mate, Toronto, Montreal are too expensive, like to like, nice pats of Delhi/Bangalore are way more expensive, same for Istanbul, Moscow, Beijing, ..not sure about brazil... But Sao palo and Brasilia are not exactly first world cities...



Canuck_Sens said:


> Just logged in because I read your thread and I thought it deserved a response
> 
> 
> 
> ...


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## Canuck_Sens (Nov 16, 2010)

woodlands said:


> Sorry mate, Toronto, Montreal are too expensive, like to like, nice pats of Delhi/Bangalore are way more expensive, same for Istanbul, Moscow, Beijing, ..not sure about brazil... But Sao palo and Brasilia are not exactly first world cities...


 I don't know which world you live in or what kind of booze you drank, but your arguments are non sense at best.

a) Montreal is dirty CHEAP compared to Toronto.

b) How exactly nice places in Delhi/ Bangalore are more expensive ? They are cheaper hands down compared to Toronto. The yield in rents sucks in India. 

c) Pretty good House Families in Toronto DT can be found for 1,5 M CAD above. Strange prices kind of remind me Dubai for some villas in some nice spots.

You mentioned that Sao Paulo is not a first world city ? I wonder what defines a first world city . I dont even know why you mentioned Brasilia, I was expecting Rio de Janeiro. Brasilia is the capital and there you only have politicians and public servants. 

First world cities should have for example a pretty good infra and a pretty good quality of life offered to their residents. Based on this all the cities you mentioned except for Montreal make the 1st world city. 

I suggest you to look close at the city rankings.

Do you consider Dubai a first world city ? The UAE does not even have the "Emergent Economy status" yet.


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## rsinner (Feb 3, 2009)

The part I agree on is that real estate in India is more expensive than UAE. Try buying in the good areas of Mumbai or Delhi - if you actually manage to find a place, the valuation would be a few million dollars (not Dirhams). The only places a normal person can buy in Delhi or Mumbai is in the suburbs (something akin to Motor City etc), or in a not so great area (something akin to Int'l city or DG).


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## Elphaba (Jan 24, 2008)

Nasty little boys (who do not understand economics and fall for marketing hype) and throw around personal insults will not be tolerated on this forum. 

:ranger:


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## Elphaba (Jan 24, 2008)

Canuck_Sens said:


> Do you consider Dubai a first world city ? The UAE does not even have the "Emergent Economy status" yet.



Quite. The UAE is considered a 'frontier economy', a step behind an emerging market.


Sadly, some people will always fall for the hype.


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## woodlands (Jan 13, 2010)

Elphaba said:


> Quite. The UAE is considered a 'frontier economy', a step behind an emerging market.
> 
> 
> Sadly, some people will always fall for the hype.


See, quoting a piece of fact without knowing the relevant details can lead you to make the wrong conclusion. Not trying to be condescending but a little knowledge is a dangerous thing. So you read UAE was a frontier market in some newspaper and applied it across a wide spectrum of assets.
UAE is an emerging market based on FTSE qualification and is a frontier market as per MSCI qualification. But here's where you are wrong. This is limited to listed equity market which in majorly exporting countries is generally not reflective of overall economy or a significant capital allocation mechanism....especially in Saudi Arabia, Qatar, UAE.
Plus the reason why UAE is frontier and not EM is because the stock exchange has not complied on a technicality of DVP ( Delivery vs Payment) to satisfaction of MSCI and because there are ownership restrictions on banks and telecom companies for foreigners. Etisalat has one of the highest ARPU's globally but foreign investors can't buy the stock. This lack of access is why Qatar is also frontier rather than EM. The Saudi market trades c 2 bn usd/day, as much as India at best of times, very large very credible, but they don't allow foreigners to buy their stocks directly. So these guys are frontier not because they aren't good enough but because they couldn't give a toss about foreigner's money.
So we sorted equity. Lets talk about credit. You know the spread of 1 yr Dubai sovereign over investment grade Malaysia...0.8%... And thisis Dubai, not UAE. Investors are lapping up Gulf credit like no tomorrow.... Sukuks are getting priced at less than 150 bp to LIBOR, Dubai (not UAE ..but Dubai) yield has reduced on 2 yr by 350 bp.... So on credit you are way way way way off the mark.

You see if you feel insulted after reading this, I can't help...your ignorance is your problem. You want to climb some steps up, get an education.


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## Cearense (Aug 19, 2011)

Canuck_Sens said:


> You mentioned that Sao Paulo is not a first world city ? I wonder what defines a first world city . I dont even know why you mentioned Brasilia, I was expecting Rio de Janeiro. Brasilia is the capital and there you only have politicians and public servants.


São Paulo, Rio and Brasília are in the middle of a property boom and real estate prices are on par with Dubai.

If you want to buy cheap real estate, look for something in the US. Quite spectacular beachfront properties in Florida or California much cheaper than Dubai, with property and mortgage laws that don't change every minute.


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## m1key (Jun 29, 2011)

Charming as ever Woodlands


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## Elphaba (Jan 24, 2008)

woodlands said:


> See, quoting a piece of fact without knowing the relevant details can lead you to make the wrong conclusion. Not trying to be condescending but a little knowledge is a dangerous thing. So you read UAE was a frontier market in some newspaper and applied it across a wide spectrum of assets.
> UAE is an emerging market based on FTSE qualification and is a frontier market as per MSCI qualification. But here's where you are wrong. This is limited to listed equity market which in majorly exporting countries is generally not reflective of overall economy or a significant capital allocation mechanism....especially in Saudi Arabia, Qatar, UAE.
> Plus the reason why UAE is frontier and not EM is because the stock exchange has not complied on a technicality of DVP ( Delivery vs Payment) to satisfaction of MSCI and because there are ownership restrictions on banks and telecom companies for foreigners. Etisalat has one of the highest ARPU's globally but foreign investors can't buy the stock. This lack of access is why Qatar is also frontier rather than EM. The Saudi market trades c 2 bn usd/day, as much as India at best of times, very large very credible, but they don't allow foreigners to buy their stocks directly. So these guys are frontier not because they aren't good enough but because they couldn't give a toss about foreigner's money.
> So we sorted equity. Lets talk about credit. You know the spread of 1 yr Dubai sovereign over investment grade Malaysia...0.8%... And thisis Dubai, not UAE. Investors are lapping up Gulf credit like no tomorrow.... Sukuks are getting priced at less than 150 bp to LIBOR, Dubai (not UAE ..but Dubai) yield has reduced on 2 yr by 350 bp.... So on credit you are way way way way off the mark.
> ...


The more you post and the ruder you are, the more ignorant and unpleasant you appear.


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## Elphaba (Jan 24, 2008)

It seems that the UAE Central Bank is backtracking.

Edited & updated info here: News: Further restrictions on UAE mortgages – edited 21/01/13 | Financialuae's Blog

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