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Will real estate recover? Outlook is… better
Mortgage holders might not end up in court, Lloyds is back in a lending mood, and one bank says everything is going to be just fine and dandy.
January 11, 2011 3:17 by Eva Fernandes
We are all for staying positive (only for today, of course) but worried whispers of an oversupplied market from industry experts come back to us. And though we try to shake it off our nagging memory won’t let us forget the findings of the latest report by leading real estate investment and advisory firm, Jones Lang LaSalle who predicted that even if the current projects are “are not completed and handed over in time, Dubai’s residential market [will continue] to be oversupplied and prices are not expected to recover before the second half of 2011 at the earliest.” Spoilsports.
Fortunately there is more cheerful news around; Emirates 24|7 reports that mortgage companies are more willing to negotiate a settlement with defaulting customers than take them to court. Scott Hutton, Senior Counsel, Real Estate & Construction department, Habib Al Mulla & Company told the one-time paper that, “In our experience, mortgage lenders have been filing cases, but not as many as we might have expected. It appears that, under these difficult economic circumstances, most are willing to negotiate settlements, this includes extending maturity dates and restructuring debts etc.” However, that is not to say mortgage companies have not gone to court over defaults; in fact Barclays won the first foreclosure order in 2010, after which there were reports that Tamweel and other banks were closely following in Barclays’ footsteps.
OK, so not being taken to court might not be really ‘cheerful’ news, but given the troubled times we are in, one can’t be too picky. And, if you combine that with news that Lloyds is to resume offering mortgages in Dubai after a two year break, we can almost feel hopeful. Almost. The bank says it is planning to launch mortgage products for apartment buyers as it attempts to reclaim some of the market.
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