Qatar Announces Major Mortgage Rule Changes

Qatar has introduced major changes to regulations for real estate financing in the country. New rules define the number of money residents and citizens can borrow to purchase the property. They also provide guidelines on the amount of time given to pay back mortgages in the country.

Qatar Central Bank (QCB) announced the introduction of amendments to the real estate financing (mortgage) regulations, including determining the maximum loan-to-value (LTV) and tenure- for mortgages within the country.

The updated regulations will be applied to Qatari banks and subsidiaries within the country, while branches and subsidiaries of Qatari banks outside Qatar should comply with the instructions and conditions of the host regulatory authorities as long as the collaterals and financed properties are outside the country.

These amendments come within the framework of QCB’s efforts to develop instructions related to real estate financing controls in line with the requirements of the current stage in the development of the sector, without prejudice to the necessary precaution for real estate risks.

According to the new amendments, the ceilings for granting real estate financing are divided into three categories.

The first category is the financing of ready and under-construction residential properties for individuals, whose repayment sources are linked to the client’s own sources, salary or any other non-real estate sources.

The second category is financing ready properties for individuals and companies for investment and commercial purposes, with the repayment depending mainly on real estate revenues.

The third category is financing real estate under construction for investment and commercial purposes with the repayment depending on the property revenues in whole or in part.

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