Law No.

(14) of 2008 Concerning Mortgages in the Emirate of Dubai

Tariq Ajaz Senior Vice President - Corporate Services Amlak Finance PJSC

Some Statistics

UAE is in the top four amongst the most active land markets worldwide for the first half of 2008 Global sales reached AED235Bn (USD64Bn) during this period.
(Source: Real Capital Analytics, NY)

13,748 villas set for completion within the next 2 years

(Source: Asteco Dubai Q2 2008)

65% of mortgage market is with 2 lenders and 35% is with 23

Some Background

In 2002 Government of Dubai Allowed Non GCC Nationals to own

Law #7 issued in March 2006 relating to Freehold/leasehold property ownership

Prior to this law, little clarity on ownership Market was in infancy stage

Law #14 introduced recently and is a move towards further regulations

Effects of Law #14

Covers relationship between lender and borrower Will help to strengthen the sector Much needed in light of recent project delays and corruption probes All mortgage contracts to be registered with DLD Size of loan Repayment Period Value of property Mortgages can only be sold by registered financial institutions Protects investors

Effects of Law #14 on Real Estate Brokerage Companies

Subjecting brokers to additional training Fewer brokerage firms in the market Higher payrolls and incentives to qualified brokers Enhancements in the code of conduct and ethics for the brokers

Effects of Law #14 on Master Developers and Developers

Defaults by private developers and off plan project termination Simplifies approving project financing Opening new possibilities for construction and bridge financing Increase sales for end user categories in the long run May push investors to other markets

Effects of Law #14 on the End User

Higher Confidence Wider variety of projects and finance projects Should eliminate over commitment from borrowers Credit agencies will play a role Distinguish between end users and speculators Less flipping in the market Better security and protection Identified remedies for defaulters

In Conclusion

Why was the law needed? Mortgage funding set to increase by 190% over coming years To avoid uncertainties in the market To bring about a sense of stability for Dubai/UAE as a global player Going forward, while times are difficult, the fundamentals of the economy are strong Strong Economic growth Greater international corporate presence High and sustained population growth Upgraded infrastructure Booming tourism

Thank you

Tariq Ajaz Senior Vice President - Corporate Services

Amlak Finance PJSC Email: Tajaz@amlakfinance.com Tel: +971 4 427 4832 Fax: +971 4 427 4830