Visitors inspect Mall of the World at Dubai Properties section at the exhibition of Global Cityscape 2014, at Dubai International Convention and Exhibition Centre yesterday. Dubai property price rises, at close to 30% year-on-year, had been among the highest in the world throughout 2013 and the first part of 2014, causing many - including the UAE central bank - to fear a repeat of the local market crash of 2008-9, which saw prices slump more than 50%.

Reuters

Dubai

Dubai’s booming property market is showing signs that it may be cooling off, industry data showed yesterday, after two years of soaring prices that had drawn warnings of possible overheating from the International Monetary Fund.

Property price rises, at close to 30% year-on-year, had been among the highest in the world throughout 2013 and the first part of 2014, causing many - including the United Arab Emirates central bank - to fear a repeat of the local market crash of 2008-9, which saw prices slump more than 50%.

But average residential rents fell 1% in the third quarter, their first decline since 2012, pressured by weaker demand during the holy month of Ramadan and a rise in new home supply, a report by real estate investment firm CBRE said.

A separate report by property consultant JLL showed that residential rents and sales rose 2% and 1% in the same period, slower than the respective 3% and 6% increases posted in the second quarter.

“Driven by tighter government regulations and an increasing mismatch between buyer and seller expectations, the residential sector is now experiencing a welcomed period of stability,” the JLL report said.

JLL added it expected rents and sale prices to remain relatively stable over the rest of 2014, “with the market behaving in a more sustainable and healthy manner”.

The data is the first to suggest that the Dubai real estate market might by cooling off after soaring since 2012, and will be used by the authorities in the emirate as evidence that measures taken to prevent speculation driving up prices are beginning to impact.

Dubai’s Land Department doubled last year the fee it charges on property transactions to 4%, while new lending limits on mortgages were introduced by the UAE central bank.

The CBRE report yesterday showed the fall in rents wasn’t uniform but was affecting some of Dubai’s more fashionable areas which had experienced the biggest rises, including Downtown Dubai - the area encompassing the world’s tallest building, the Burj Khalifa - where they dipped by an average of 3%.

 

QFCRA papers aim banking, investment management rules streamlining

The Qatar Financial Centre Regulatory Authority (QFCRA) has released two consultation papers containing proposals to strengthen and streamline its prudential framework for banking, investment management and advisory activities undertaken by authorised firms in the QFC.

It is proposed that the current Investment and Banking Business Rules 2005 will be repealed and replaced by the draft Banking Business Prudential Rules 2014, and Investment Management and Advisory Rules 2014.

The proposed Banking Business Prudential Rules 2014 will apply to authorised firms that accept deposits, provide credit, deal in investments as principal, or undertake Islamic financial management.

The proposed rules focus on the risk management and internal capital adequacy assessment process; capital adequacy and capital requirements; credit risk; market risk; interest rate risk in the banking book; liquidity risk; group risk; prudential reporting; and Islamic financial management firms.

The proposed Investment Management and Advisory Rules 2014 is designed to simplify and tailor the rules that apply to firms undertaking investment management and advisory business, focusing on regulatory capital; risk management and internal risk and solvency self-assessment process; professional indemnity insurance; client money and asset protection; and Islamic investment management and advisory firms.

These initiatives support the QFCRA’s ongoing commitment to meeting high international regulatory standards, and support the continued development of the QFC as a leading financial and business centre in the region.

The papers call for public comment on draft rules that are designed to clearly differentiate between the sectors of banking business, and investment and advisory business. The consultation period is open until November 2, 2014.

 

 

 

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