If you’re looking to buy a home in Saudi Arabia, we have good news. The Saudi Arabian Monetary Authority (SAMA) last week raised the country’s mortgage limit to 85% of the value of a property.
Under previous rules, it was only possible to secure a bank mortgage for 70% of the value of a Saudi home, meaning that buyers would have to find the remaining 30% for themselves. When talking large investments like property, 30% is still big chunk of cash, and with the economy struggling in recent years, many people have been unable to find that sort of money to stump up.
Specialised mortgage companies have, since last year, been allowed to offer mortgages at 85% of the value of a property, but these financial houses tend to demand larger interest payments than banks do.
Now, though, banks are allowed to offer mortgages for 85% of the value of a property, meaning that buyers will only have to find 15% for themselves.
However, there is a catch in that the new cap will only apply to first-time buyers – the idea being that the new cap should help more Saudi citizens get onto the property ladder.
SAMA added that the move will be beneficial for banks, too. After all, now that they can offer bigger mortgages, they’ll be able to offer customers a wider range of products.
Want to buy your own home? Click here to compare mortgages from the Kingdom’s leading lenders.