Dubai gets new mortgage law
From "FOH News" on 27 August 2008
Coming into effect 60 days after it is published in the official gazette, the law legalises the housing finance sector and stipulates that mortgage contracts must be registered with the Dubai Land Department (DLD); specifying the size of the loan, the repayment period and the value of the property on which the finance is obtained.
In addition to the registration requirements, all mortgages taken out on property in the Emirate must have an insurance guarantee.
This move from the Dubai government comes as it works to consolidate its booming property sector.
In the first quarter of this year, the value of property transactions taking place in the Emirate (Dh3.7bn) were up an astronomical 10,000% y-o-y on 2007’s figures (Dh38m), according to the Dubai Land Department.
As part of the regulation of its greater finance sector, the government has also made its intentions known to introduce Value Added Tax (VAT) by 2010 to cut the UAE’s dependence on oil for economic growth.
Dubai’s drive to tighten its expansion through a series of initiatives has pushed it to the top of the Global Real Estate Transparency Index from Jones Lang LaSalle.
The research revealed that in 2008, eight countries moved up a full transparency tier since the last index in 2006. Dubai, Romania, Ukraine and Russia showed the biggest improvements in transparency over the last two years.
