Banks need to urgently revive mortgage lending to stop the property market from spiralling further downwards, an industry expert has urged.
Lending for off-plan property, which makes up most of the country’s property stock, has ground to a halt, apart from those being developed by government-backed big developers such as Nakheel, Emaar Properties and Dubai Properties. Some banks, such as Lloyds, have trimmed their mortgage lending to 50% of the value of completed villas.
'Most people are holding contracts to buy properties, mainly in Dubai, and the position now is that there is no finance left to complete that purchase,' said Jonathan Bridges, a mortgage consultant for Globaleye, a Dubai-based firm. 'If this continues then the market is going to fall further. And how many people here are selling villas that are complete? Virtually none. It’s going to take some brave lenders to step into the market and actually do something about this situation.'