Understanding the Updated Financing Requirements of Real Estate Properties in Qatar

December 29, 2023 4:40 pm

The Central Bank of Doha recently issued a circular that provides important guidelines on the financing requirements for real estate properties in Qatar. This circular addresses various aspects of property financing, focusing on different categories of individuals and companies. We’re going to delve into the key points highlighted in the circular, so you know what to expect when it comes time for you to consider buying a property in the rapidly-evolving city!

Financing Property for Residential Purposes

The first point emphasized in the circular pertains to financing real estate properties for personal residential use, rather than investment purposes. The guidelines differ for Qatari nationals and expatriates.

A. Qatari Nationals

For Qatari nationals, the circular states the following:

  1. If the value of the property is equal to or less than 6 million riyals, banks can finance up to 80% of its value. However, the financing tenure is limited to a maximum of 30 years.
  2. If the value of the property exceeds 6 million riyals, banks are allowed to finance only 75% of its value. The maximum financing tenure remains the same at 30 years.

B. Expatriates

The guidelines for expatriates seeking property financing are as follows:

  1. If the value of the property is equal to or less than 6 million riyals, banks can finance up to 75% of its value. The maximum financing tenure is 25 years.
  2. If the value of the property exceeds 6 million riyals, banks are permitted to finance only 70% of its value. The financing tenure is limited to a maximum of 25 years as well.

Financing Real Estate for Investment Purposes

The second point addressed in the circular relates to financing real estate properties for investment purposes. In such cases, the repayment of the financing is based on the rental income generated by the property. The guidelines vary depending on the nationality and ownership of the individuals and companies involved.

A. Qatari Nationals and National Qatari-Owned Companies

For Qatari nationals and national Qatari-owned companies, the circular outlines the following guidelines:

  1. If the value of the property is equal to or less than 10 million riyals, banks can finance up to 75% of its value. The maximum financing tenure is 25 years.
  2. If the value of the property exceeds 10 million riyals, banks are allowed to finance only 70% of its value. The financing tenure remains capped at 25 years.

B. Expatriates and Expat-Owned Companies

Expatriates and expat-owned companies must adhere to the following guidelines:

  1. If the value of the property is equal to or less than 10 million riyals, banks can finance up to 70% of its value. The maximum financing tenure is 25 years.
  2. If the value of the property exceeds 10 million riyals, banks are permitted to finance only 65% of its value. The financing tenure remains restricted to a maximum of 25 years.

C. Non-Residents

Non-residents who wish to invest in real estate properties have their own set of guidelines:

  1. If the value of the property is equal to or less than 10 million riyals, banks can finance up to 60% of its value. The maximum financing tenure is 20 years.
  2. If the value of the property exceeds 10 million riyals, banks are allowed to finance only 60% of its value. The financing tenure is further reduced to a maximum of 15 years.

Financing Real Estate Based on Rental Income

The circular also covers financing options for real estate properties where repayments are based on rental income, either partially or in full.

A. Qatari Nationals and Qatari-Owned Companies

For Qatari nationals and Qatari-owned companies seeking financing based on rental income, the circular states that the maximum financing provided by banks is 60% of the property’s value. The financing tenure is limited to a maximum of 20 years.

B. Expatriates and Non-Resident Individuals & Companies

Expatriates, non-resident individuals, and companies can obtain financing based on rental income under the following conditions:

  1. The maximum financing offered by banks is 50% of the property’s value.
  2. The financing tenure is limited to a maximum of 15 years.

It is important to note that the circular encompasses additional areas of financing, including repayment terms and the sources of those repayments, to be implemented by the banking sector in Qatar.

Understanding the updated financing requirements outlined in the circular by the Central Bank of Doha is crucial for anyone considering real estate investments or seeking property financing in Qatar. These guidelines ensure transparency and promote responsible lending practices within the real estate market, benefiting both borrowers and financial institutions. If you’re looking to make that big move and invest in Qatar, your can find the most exclusive properties in Qatar at www.fgrealty.qa

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