Buying into UAE's success
With Dubai recovering rapidly from the recession and Abu Dhabi investing heavily into development, the Emirates is clearly on the global investor map - once again. In fact, the emirate actually made a place on the third quarter investment 'hot list,' issued by IP Global, which features the best investment destinations at the time.
Investments continue to pour into the UAE from expats in neighbouring countries, including India. Burj Khalifa is among the favourite global locations for India's ultra-high net-worth individuals to own luxury residential properties, according to a new report by Kotak Wealth Management and CRISIL Research. Understanding the significance of these investments, Damac Properties is offering a refund on the cost of an air ticket for Indians who close a deal on its $2.5 billion Akoya by Damac master development.
Overall, the UAE has climbed a rank in the global prosperity index, coming 28th globally and first in the Middle East and North Africa region. Its economy sub-index was ranked 13 by the London-based Legatum Institute's Prosperity Index.
Taking into account growing concerns about how quickly property prices have been going up, the UAE Central Bank has issued a new set of regulations on mortgage lending, defining the eligibility of borrowers, based on the loan-to-value relation. Now, expatriates have a mortgage limit of 75% for properties valued less than Dhs5 million. The maximum limit for a mortgage loan is set at 25 years. Home buyers will also no longer be allowed to seek personal loans or use their credit cards to meet down payment requirements.
By issuing this system, the bank wants to ensure "all banks and financial institutions in the country have authorised and credible business criteria and effective frameworks that will control their mortgage loans," said Central Bank governor Sultan bin Nassir Al Suwaidi.
Market Insight is aimed at examining the emirate's dynamic market and forecasting industry trends. The UAE's popularity among investors is definitely on the rise and while there are growing concerns of a property bubble, the UAE government has been implementing new measures to curb the practice of property flipping that was so common in 2008. We hope our round-up of key stories and expert opinions have helped shed insight on new regulations and measures being implemented.