thriving mortgage industry is vital to the recovery of the property sector in the Gulf. Now that speculators have all but left the market, new sales in the months ahead will mainly come through real demand.

Those that truly need housing are not cash buyers, but average income households with limited savings. These require access to long-term affordable mortgages in order to step onto the property ladder.

Yet the mortgage industry is severely underdeveloped in the Middle East. Legislation that both protects the consumer and enforces mortgage terms is lacking. The quick-profit mentality in the region means long-term products are difficult to come by. The average tenor of a mortgage in the Middle East is up to 15 years, whereas in the US and the UK it is around 30 years.

But with its young and rapidly growing population, the region offers huge potential for mortgages. The benefits of a developed mortgage industry are not limited to the real-estate sector and finance houses. Home ownership has a positive impact on society as a whole. It encourages people to take a pride in and responsibility for their surroundings and reduces the transient nature of a community.

Furthermore, if developers construct new properties with long-term owners in mind, rather than landlords and speculators, it inevitably drives up the quality of the end product.

Provided lenders learn the lessons of the financial crisis and do not encourage customers to live beyond their means, the region has much to gain from pushing the development of a mortgage industry.