UAE Central Bank new mortgage lending regulations for nationals and expats

Published:  30 Oct at 6 PM
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In an attempt to increase security and stability within the Dubai property market, the UAE’s central bank has issued new lending regulations for both Emiratis and expats.

For UAE nationals wishing to purchase their first home, a maximum of 80 per cent of the property’s valuation up to $1.36 million will be lent, with a lending ceiling of 70 per cent for properties valued at above that amount. For purchasers seeking a second home or property, the loan will be pegged to a maximum of 65 per cent of valuation.

For expatriate buyers, mortgage limits for first properties have been fixed at 75 per cent on valuations of $1.36 million or less, and 65 per cent if the valuation exceeds $1.36 million. Second properties will attract loans of 60 per cent of the property’s value.

Maximum mortgages on homes of any category bought off-plan from developers will be set at 50 percent, with maximum loan periods of 25 years, and the maximum age of the buyer when the loan matures must be 70 years or less for Emiratis and 65 for expats. Another change is that the total monthly repayments of all debts including the mortgage must not exceed 50 per cent of monthly income.

Maximum financing levels are also subject to adjustment, with UAE nationals allowed eight times their annual salaries and expats a multiplication of seven. The new rules are a concern for property developer Zaid el Chaar, who told the media they did not give clear guidelines allowing banks to provide a practical and pragmatic mortgage for expats, adding that it will not help the UAE attract international investors.
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