A new mortgage product, intended for overseas investors looking to purchase property in the Emirates, is close to being launched by a handful of Dubai banks.
After the global crisis, mortgage financing came to a stop as the United Arab Emirates’ two major mortgage providers were forced to stop
lending for nearly two years, after prices dropped by more than 60%.
Lenders now want to return to the mortgage market and gain overseas clients, which they intend on doing by introducing new mortgage
“We have now got three, maybe four, banks who are interested to financing certain people who are non-residents,” Jean-Luc Desbois, managing director of Dubai-based mortgage consultancy Home Matters.
He went on to say that there is a need for smaller lenders to increase their range of products, in order to keep up with the competition.
“Confidence is returning with the banks. They arelooking further afield because of the competition here,” he said.
“There are nearly 27 banks lending here but they are predominantly lending to residents in the UAE so if you want to differentiate
yourself you have to look further afield where you are in a smaller pool of lenders.”
The introduction of a new mortgage product aimed purely at foreign investors was instigated by the UAE federal government, which said it would extend the three year visas.
Villas have been particularly popular in Dubai, with success in the past 15 months causing prices to increase by 30%.
Transferring money to Dubai
If you are looking to invest in Dubai, think carefully regarding how to send money abroad. Foreign currency exchange rates quoted by banks are almost always worse than the exchange rates available through specialist currency dealers.
So if you are sending money to Dubai, which you will inevitably have to do if you are looking to make a property investment, be sure to look carefully at the market before you buy your overseas currency.
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