Persian Gulf lenders decide to stop giving out mortgages

In yet another indication that the international financial crisis has arrived on the shores of the Persian Gulf, the largest mortgage lender in the United Arab Emirates, Amlak, will temporarily stop granting new home loans, according to media reports. Experts say this is bad news for the UAE real estate market. As credits dwindle, the prices of real estate in this oil-rich emirate might further drop, and the whole economy might be negatively affected. The UAE’s English-language daily, the National, sounded the alarm, quoting Chris Dommett, chief executive of John Charcol Dubai, a mortgage advisory firm: ‘I think they don’t have funds to lend. It sends a very negative message to the market at a time when they need some sort of positive news.’ Property prices fell last month by 4% in Dubai and 5% in Abu Dhabi, according to data from HSBC Bank cited by the National.