DUBAI, Jan 11 (Reuters) - Saudi Arabia’s central bank lifted the maximum loan-to-value rate on Thursday for mortgages for first-time homebuyers to 90 percent from 85 percent in an effort to stimulate mortgage lending.
“Raising the maximum limit of the percentage of financing of the value of the first house for citizens will contribute to supporting the growth of the real estate financing sector,” the Saudi Arabian Monetary Authority (SAMA) said in a statement on its website.
It said the decision also aims to help the kingdom achieve its national housing strategy, part of wider economic reform plans, but added that the move must not affect the stability of the financial sector.
SAMA raised the loan-to-value rate for first-time buyers to 85 percent from 70 percent a year ago. (Reporting by Marwa Rashad; Writing by Sami Aboudi; Editing by Peter Graff)