If you are planning to buy a property in the UAE this year, then there is some good news for you. The US Federal Reserve's decision to retain its benchmark interest rate at near zero per cent until at least the end of 2023 to stimulate economic growth and counter weak inflation will lower the cost of borrowing for consumers, including for mortgages.
Low interest rates for a prolonged period of time will also result in a weaker US dollar. And with the dirham pegged to the greenback, this has obvious implications for residents in the Emirates. Not only is it expected to further reduce the cost of borrowing in the UAE, but it will also boost the property market and deepen investor interest in gold, cryptocurrencies and the equity market, according to experts.
At the beginning of the pandemic, the US dollar strengthened to an almost two-decade high as demand rose for a safe-haven currency. This resulted in non-dollar-denominated buyers having to pay a premium for UAE properties.
“Since the dollar’s peak in the latter part of March, we have seen demand for a safe-haven currency such as the US dollar dissipate and, as a result, the dollar has weakened by 4.9 per cent from its peak to mid-September,” says Taimur Khan, an associate partner at Knight Frank.
“Given current market valuations and outlook for the market, international buyers who can capture additional discounts via currency are very likely to take advantage of the UAE property market.”
Aside from lower financing costs, developers have also begun to offer favourable payment plans to attract demand. According to Knight Frank data, on average 28.4 per cent of the total payment for Dubai properties is structured to be paid post-handover, up from 6.6 per cent in 2016. Some developers are also throwing in service charge exemptions and transaction fee waivers, among other offers.
Developers are now also demanding lower levels of payments during construction and on completion, says Mr Khan. In 2016, 43.1 per cent of the total payment was required during construction and 39.7 per cent on completion. In contrast, these have decreased in 2020 to 34.1 per cent and 28.3 per cent respectively, according to Knight Frank data.
Interest rate cuts by the UAE Central Bank have led to a fall in the cost of borrowing. While the UAE’s six-month Emirates Interbank Offered Rate (Eibor) has fallen from highs of 3.14 per cent in early 2020 to lows of 0.5 per cent in mid-September, mortgage rates have also followed suit, Mr Khan adds.
According to Mortgage Finder, mortgage interest rates have fallen over the past 18 months, sitting at 2.69 per cent in 2020 from 3.75 per cent this time last year. Both investors and owner-occupiers are likely to take advantage of these favourable financing rates.
We would hope to see cheaper finance for new borrowers and better refinance [buyout] options for existing borrowers
"The best current mortgage rates are at 2.69 per cent fixed for three years and 2.99 per cent fixed for five years," Brendan Kennelly, senior mortgage consultant at Mortgage Finder, tells The National.
“We would hope to see the banks in the UAE pass the benefit of the recent Fed announcement on to customers, meaning cheaper finance for new borrowers and better refinance [buyout] options for existing borrowers.”
An increase in demand for refinance mortgages and buyouts is likely following the Fed’s decision. Mr Kennelly says Mortage Finder is “already seeing enquiries from existing mortgage holders looking at lowering their interest rates given the current offers available”.
“The expectation is that we are going to be in a low interest rate environment for at least the next five years,” Mr Kennelly adds.
Leading remittance providers in the UAE do not see a big impact of the dollar weakness. Customers who transfer funds to their families every month will continue doing so, they say. However, there is likely to be a small dip in the number of transfers from rate-sensitive customers who have fewer commitments in their home countries.
“A weaker USD would make remittances to other corridors such as the British pound, euro and Indian rupee more expensive as the exchange rate for all other currencies against the USD will appreciate,” says Rajiv Raipancholia, chief executive of Orient Exchange.
According to Adeeb Ahamed, managing director of Lulu Financial Holdings, the US dollar and the UAE dirham will continue to maintain their supremacy among Asian currencies.
“Blue-collar workers will serve their families and commitments back home, meaning remittances from the UAE shall continue at a stable level. The volumes, however, would be a little subdued as white-collar expats look to hold on to their reserves for better rates,” he says.
A weaker US dollar is expected to lead to higher prices for gold and cryptocurrency as a hedge against inflation.
“Increasing numbers of investors may diversify their portfolio to include digital assets such as Bitcoin and alt coins due to higher expected returns," says Arshad Khan, co-founder and chief executive of Arabian Bourse. "For the period from January 2019 to September 2020, Bitcoin’s annualised price volatility was 74 per cent, with year-to-date 2020 returns of 45 per cent.”
Mr Khan says several corporates and banks have already started diversifying their cash reserves and investment portfolios to include digital assets as well as gold and other alternative investments. This trend is expected to rise in the coming months of global uncertainty due to growth concerns, he says.
Economists expect the Fed’s extreme dovishness to play out more on foreign exchange and bond markets, where the US dollar could weaken further and bond yields remain low.
“The main benefit for the UAE will be the scope of governments to continue to tap international bond markets,” says Scott Livermore, chief economist, Oxford Economics Middle East.
“The tourism sector could get a boost because of a weaker dirham against European currencies, but this is unlikely to be significant until Covid-19 is under control.”
Although increased bank lending is critical for fuelling the recovery, Mr Livermore does not expect to see a significant pick-up, especially in lending to SMEs, until a sustained economic recovery is under way.
While the lower interest rates are welcome news for borrowers, they spell poor returns for savers.
“Interest rates on cash accounts will continue to be low given the [Fed's] comments, meaning that it is going to prove difficult to generate a return on cash assets,” says Chris Davies, a chartered financial planner at The Fry Group.
He adds that there is potential for further capital flows into equities, considering how low-risk assets such as government debt are yielding low returns. Equity markets are also assisted by governments' supportive actions in the form of massive amounts of fiscal and central bank stimulus, Mr Davies says.
“Fixed-income assets could remain a low-return asset class. Investors seeking a return from fixed-income assets will need to be careful of how they aim to achieve this, with potential downgrades and defaults on some high-yield debt investments,” Mr Davies adds.
In numbers
Number of Chinese tourists coming to UAE in 2017 was... 1.3m
Alibaba’s new ‘Tech Town’ in Dubai is worth... $600m
China’s investment in the MIddle East in 2016 was... $29.5bn
The world’s most valuable start-up in 2018, TikTok, is valued at... $75bn
Boost to the UAE economy of 5G connectivity will be... $269bn
The biog
Name: Fareed Lafta
Age: 40
From: Baghdad, Iraq
Mission: Promote world peace
Favourite poet: Al Mutanabbi
Role models: His parents
SHADOWS%20AND%20LIGHT%3A%20THE%20EXTRAORDINARY%20LIFE%20OF%20JAMES%20MCBEY
%3Cp%3EAuthor%3A%20Alasdair%20Soussi%3C%2Fp%3E%0A%3Cp%3EPages%3A%20300%3C%2Fp%3E%0A%3Cp%3EPublisher%3A%20Scotland%20Street%20Press%3C%2Fp%3E%0A%3Cp%3EAvailable%3A%20December%201%3C%2Fp%3E%0A
ON%20TRACK
%3Cp%3EThe%20Dubai%20Metaverse%20Assembly%20will%20host%20three%20main%20tracks%3A%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EEducate%3A%3C%2Fstrong%3E%20Consists%20of%20more%20than%2010%20in-depth%20sessions%20on%20the%20metaverse%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EInspire%3A%3C%2Fstrong%3E%20Will%20showcase%20use%20cases%20of%20the%20metaverse%20in%20tourism%2C%20logistics%2C%20retail%2C%20education%20and%20health%20care%3C%2Fp%3E%0A%3Cp%3E%3Cstrong%3EContribute%3A%3C%2Fstrong%3E%20Workshops%20for%20metaverse%20foresight%20and%20use-case%20reviews%3C%2Fp%3E%0A
Children who witnessed blood bath want to help others
Aged just 11, Khulood Al Najjar’s daughter, Nora, bravely attempted to fight off Philip Spence. Her finger was injured when she put her hand in between the claw hammer and her mother’s head.
As a vital witness, she was forced to relive the ordeal by police who needed to identify the attacker and ensure he was found guilty.
Now aged 16, Nora has decided she wants to dedicate her career to helping other victims of crime.
“It was very horrible for her. She saw her mum, dying, just next to her eyes. But now she just wants to go forward,” said Khulood, speaking about how her eldest daughter was dealing with the trauma of the incident five years ago. “She is saying, 'mama, I want to be a lawyer, I want to help people achieve justice'.”
Khulood’s youngest daughter, Fatima, was seven at the time of the attack and attempted to help paramedics responding to the incident.
“Now she wants to be a maxillofacial doctor,” Khulood said. “She said to me ‘it is because a maxillofacial doctor returned your face, mama’. Now she wants to help people see themselves in the mirror again.”
Khulood’s son, Saeed, was nine in 2014 and slept through the attack. While he did not witness the trauma, this made it more difficult for him to understand what had happened. He has ambitions to become an engineer.
Salah in numbers
€39 million: Liverpool agreed a fee, including add-ons, in the region of €39m (nearly Dh176m) to sign Salah from Roma last year. The exchange rate at the time meant that cost the Reds £34.3m - a bargain given his performances since.
13: The 25-year-old player was not a complete stranger to the Premier League when he arrived at Liverpool this summer. However, during his previous stint at Chelsea, he made just 13 Premier League appearances, seven of which were off the bench, and scored only twice.
57: It was in the 57th minute of his Liverpool bow when Salah opened his account for the Reds in the 3-3 draw with Watford back in August. The Egyptian prodded the ball over the line from close range after latching onto Roberto Firmino's attempted lob.
7: Salah's best scoring streak of the season occurred between an FA Cup tie against West Brom on January 27 and a Premier League win over Newcastle on March 3. He scored for seven games running in all competitions and struck twice against Tottenham.
3: This season Salah became the first player in Premier League history to win the player of the month award three times during a term. He was voted as the division's best player in November, February and March.
40: Salah joined Roger Hunt and Ian Rush as the only players in Liverpool's history to have scored 40 times in a single season when he headed home against Bournemouth at Anfield earlier this month.
30: The goal against Bournemouth ensured the Egyptian achieved another milestone in becoming the first African player to score 30 times across one Premier League campaign.
8: As well as his fine form in England, Salah has also scored eight times in the tournament phase of this season's Champions League. Only Real Madrid's Cristiano Ronaldo, with 15 to his credit, has found the net more often in the group stages and knockout rounds of Europe's premier club competition.
Three ways to get a gratitude glow
By committing to at least one of these daily, you can bring more gratitude into your life, says Ong.
- During your morning skincare routine, name five things you are thankful for about yourself.
- As you finish your skincare routine, look yourself in the eye and speak an affirmation, such as: “I am grateful for every part of me, including my ability to take care of my skin.”
- In the evening, take some deep breaths, notice how your skin feels, and listen for what your skin is grateful for.
Sholto Byrnes on Myanmar politics
Brief scores:
Scotland 371-5, 50 overs (C MacLeod 140 no, K Coetzer 58, G Munsey 55)
England 365 all out, 48.5 overs (J Bairstow 105, A Hales 52; M Watt 3-55)
Result: Scotland won by six runs
RACE CARD
6.30pm: Al Maktoum Challenge Round-3 – Group 1 (PA) $65,000 (Dirt) 2,000m
7.05pm: Handicap (TB) $65,000 (Turf) 1,800m
7.40pm: Meydan Classic – Listed (TB) $88,000 (T) 1,600m
8.15pm: Nad Al Sheba Trophy – Group 3 (TB) $195,000 (T) 2,810m
8.50pm: Dubai Millennium Stakes – Group 3 (TB) $130,000 (T) 2,000m
9.25pm: Meydan Challenge – Listed Handicap (TB) $88,000 (T) 1,400m
RESULT
Leeds United 1 Manchester City 1
Leeds: Rodrigo (59')
Man City: Sterling (17')
Man of the Match: Rodrigo Moreno (Leeds)
European arms
Known EU weapons transfers to Ukraine since the war began: Germany 1,000 anti-tank weapons and 500 Stinger surface-to-air missiles. Luxembourg 100 NLAW anti-tank weapons, jeeps and 15 military tents as well as air transport capacity. Belgium 2,000 machine guns, 3,800 tons of fuel. Netherlands 200 Stinger missiles. Poland 100 mortars, 8 drones, Javelin anti-tank weapons, Grot assault rifles, munitions. Slovakia 12,000 pieces of artillery ammunition, 10 million litres of fuel, 2.4 million litres of aviation fuel and 2 Bozena de-mining systems. Estonia Javelin anti-tank weapons. Latvia Stinger surface to air missiles. Czech Republic machine guns, assault rifles, other light weapons and ammunition worth $8.57 million.
Killing of Qassem Suleimani
Read more from Mina Al-Oraibi
Results
6.30pm: Al Maktoum Challenge Round-2 Group 1 (PA) US$75,000 (Dirt) 1,900m
Winner: Ziyadd, Richard Mullen (jockey), Jean de Roualle (trainer).
7.05pm: Al Rashidiya Group 2 (TB) $250,000 (Turf) 1,800m
Winner: Barney Roy, William Buick, Charlie Appleby.
7.40pm: Meydan Cup Listed Handicap (TB) $175,000 (T) 2,810m
Winner: Secret Advisor, Tadhg O’Shea, Charlie Appleby.
8.15pm: Handicap (TB) $175,000 (D) 1,600m
Winner: Plata O Plomo, Carlos Lopez, Susanne Berneklint.
8.50pm: Handicap (TB) $135,000 (T) 1,600m
Winner: Salute The Soldier, Adrie de Vries, Fawzi Nass.
9.25pm: Al Shindagha Sprint Group 3 (TB) $200,000 (D) 1,200m
Winner: Gladiator King, Mickael Barzalona, Satish Seemar.
Fourth Arab Economic and Social Development Summit
As he spoke, Mr Aboul Gheit repeatedly referred to the need to tackle issues affecting the welfare of people across the region both in terms of preventing conflict and in pushing development.
Lebanon is scheduled to host the fourth Arab Economic and Social Development Summit in January that will see regional leaders gather to tackle the challenges facing the Middle East. The last such summit was held in 2013. Assistant Secretary-General Hossam Zaki told The National that the Beirut Summit “will be an opportunity for Arab leaders to discuss solely economic and social issues, the conference will not focus on political concerns such as Palestine, Syria or Libya". He added that its slogan will be “the individual is at the heart of development”, adding that it will focus on all elements of human capital.
'Shakuntala Devi'
Starring: Vidya Balan, Sanya Malhotra
Director: Anu Menon
Rating: Three out of five stars
How to avoid crypto fraud
- Use unique usernames and passwords while enabling multi-factor authentication.
- Use an offline private key, a physical device that requires manual activation, whenever you access your wallet.
- Avoid suspicious social media ads promoting fraudulent schemes.
- Only invest in crypto projects that you fully understand.
- Critically assess whether a project’s promises or returns seem too good to be true.
- Only use reputable platforms that have a track record of strong regulatory compliance.
- Store funds in hardware wallets as opposed to online exchanges.
Sreesanth's India bowling career
Tests 27, Wickets 87, Average 37.59, Best 5-40
ODIs 53, Wickets 75, Average 33.44, Best 6-55
T20Is 10, Wickets 7, Average 41.14, Best 2-12
Cherry
Directed by: Joe and Anthony Russo
Starring: Tom Holland, Ciara Bravo
1/5
Brief scores:
Toss: Sindhis, elected to field first
Pakhtoons 137-6 (10 ov)
Fletcher 68 not out; Cutting 2-14
Sindhis 129-8 (10 ov)
Perera 47; Sohail 2-18
Palestine and Israel - live updates
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
UAE currency: the story behind the money in your pockets
Scoreline
Bournemouth 2
Wilson 70', Ibe 74'
Arsenal 1
Bellerin 52'
Where to apply
Applicants should send their completed applications - CV, covering letter, sample(s) of your work, letter of recommendation - to Nick March, Assistant Editor in Chief at The National and UAE programme administrator for the Rosalynn Carter Fellowships for Mental Health Journalism, by 5pm on April 30, 2020.
Please send applications to nmarch@thenational.ae and please mark the subject line as “Rosalynn Carter Fellowship for Mental Health Journalism (UAE programme application)”.
The local advisory board will consider all applications and will interview a short list of candidates in Abu Dhabi in June 2020. Successful candidates will be informed before July 30, 2020.
Countries recognising Palestine
France, UK, Canada, Australia, Portugal, Belgium, Malta, Luxembourg, San Marino and Andorra
10 tips for entry-level job seekers
- Have an up-to-date, professional LinkedIn profile. If you don’t have a LinkedIn account, set one up today. Avoid poor-quality profile pictures with distracting backgrounds. Include a professional summary and begin to grow your network.
- Keep track of the job trends in your sector through the news. Apply for job alerts at your dream organisations and the types of jobs you want – LinkedIn uses AI to share similar relevant jobs based on your selections.
- Double check that you’ve highlighted relevant skills on your resume and LinkedIn profile.
- For most entry-level jobs, your resume will first be filtered by an applicant tracking system for keywords. Look closely at the description of the job you are applying for and mirror the language as much as possible (while being honest and accurate about your skills and experience).
- Keep your CV professional and in a simple format – make sure you tailor your cover letter and application to the company and role.
- Go online and look for details on job specifications for your target position. Make a list of skills required and set yourself some learning goals to tick off all the necessary skills one by one.
- Don’t be afraid to reach outside your immediate friends and family to other acquaintances and let them know you are looking for new opportunities.
- Make sure you’ve set your LinkedIn profile to signal that you are “open to opportunities”. Also be sure to use LinkedIn to search for people who are still actively hiring by searching for those that have the headline “I’m hiring” or “We’re hiring” in their profile.
- Prepare for online interviews using mock interview tools. Even before landing interviews, it can be useful to start practising.
- Be professional and patient. Always be professional with whoever you are interacting with throughout your search process, this will be remembered. You need to be patient, dedicated and not give up on your search. Candidates need to make sure they are following up appropriately for roles they have applied.
Arda Atalay, head of Mena private sector at LinkedIn Talent Solutions, Rudy Bier, managing partner of Kinetic Business Solutions and Ben Kinerman Daltrey, co-founder of KinFitz
Company%20Profile
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