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Sat 11 Dec 2004 04:00 AM

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Amlak Finance stimulates secondary property market

Says it will fund difference between a home’s initial purchase price and its resale value

Amlak Finance plans to offer finance that will cover ‘property premiums’, a step that should be a major stimulus for the secondary property market. The Islamic and property finance specialist says it will set benchmark resale prices by financing property premiums at fair and transparent valuations determined by independent specialist property valuators.

“This is the very first time property premiums in the UAE will be formally recognised through our offer to finance up to 90% of the property’s valuation as determined by the independent valuators,” said Mohammed Al Hashimi, Amlak’s CEO. “This move reflects our faith and confidence in the upward trend of property prices and in the local market in general. We believe that we should be adaptable enough to meet the needs of potential buyers who want to enter the market but who are being prohibited from doing so by other financier’s reluctance to offer financing for no more than the base price set by developers.”

The secondary property market continues to be a grey area, despite the real estate development boom that has affected the whole country and Dubai in particular. Financiers have so far been reluctant to fund the difference between a home’s initial purchase price and its resale price. Long term, this could put a break on the property market.

Buyers who have bought off-plan in the general rush for any new offerings from developers have tended to see prices rocket even before the buildings have been completed. Their ability to cash in on the price rise and realise a profit has been hindered because lenders refused to finance the premiums, and the true level of prices has remained a contentious issue.

However, it is expected that with Amlak’s plan to finance property premiums, a sound secondary market should emerge. “Amlak is constantly exploring new opportunities to bring customers what they want by listening to them and studying the property market very carefully. We are constantly looking for ways to meet their needs and we are not afraid to break new ground. I believe this new offer is a good example of our customer-centric approach to property finance,” says Al Hashimi.

Amlak has also introduced a Privilege Card that provides all its mortgage finance customers with offers from outlets specialising in both home interiors furnishings and garden furniture. The Privilege Card initiative is aimed at adding value to Amlak’s home finance offerings. Privilege Card holders will be able to take advantage of discounts ranging from 5 to 25% at 23 furniture and home-related stores throughout the UAE. Outlets include Apollo Furniture, Carpe Diem, Eros Electrical, Habitat and Homes R Us.

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