Sources reveal when the new real estate financing initiative will be implemented … and canceled


04:32 PM

Wednesday 24 March 2021

I wrote – Manal Al-Masry:

Banking sources linked to the preparation of the new real estate financing initiative said that the Central Bank is studying the abolition of the requirement to specify a space for a residential unit on the middle-income segment while adhering to the maximum unit price in accordance with the new conditions that will be announced soon.

According to the sources, the aim of this is to avoid some of the restrictions that were applied in the previous real estate financing initiative, while leaving the determination of residential unit areas for the low-income segment of the real estate finance fund.

President Abdel Fattah El-Sisi directed the Central Bank to formulate and launch a new real estate financing program for the benefit of low- and middle-income groups to support their ability to own housing units, through long-term loans of up to 30 years with a low and simple interest that does not exceed 3%.

The previous initiative for real estate financing for middle-income people at an interest rate of 8%, which was launched by the Central Bank at the end of 2019, suffers from some obstacles that limited the demand for it, such as setting a condition that the net area of ​​the residential unit does not exceed 150 meters, which was a challenge in finding this area, especially with The presence of housing units in the suburbs of Cairo and Giza in which the units are distinguished by large areas such as Dokki, Mohandessin, Maadi and Nasr City, at prices consistent with the initiative.

The sources indicated that the Central Bank is currently working to finalize the conditions of the new real estate financing initiative for middle and low-income people by meeting with banks to listen to their proposals.

The sources expected the implementation of the initiative in the banking system to begin and be activated in the first half of next April, and to make it available to all banks to participate and receive financing requests from clients in accordance with the terms of the initiative.

Last week, Gamal Najm, Deputy Governor of the Central Bank, revealed in a media interview some of the features of the new mortgage finance initiative for low- and middle-income people, represented by the fact that the final maximum price for a residential unit for middle-income people is still under discussion, indicating the possibility of moving the price more than one million pounds, given that Because real estate prices are high.

He mentioned that the value of the monthly installment for low-income units reaches 1127 pounds, which is less than the rent, after receiving another support from the Social Housing Fund.

He mentioned that the conditions for middle-income people require that the monthly income does not exceed 10 thousand pounds for singles and 14 thousand pounds for a family, and that the value of the housing unit does not exceed one million pounds, while for those with limited income it is stipulated that the monthly income does not exceed 4.5 thousand pounds for single people or 6 thousand pounds for one family, The value of the housing unit through the initiative should not exceed 350 thousand pounds.

Najm specified general conditions for the initiative, including that the unit must be complete, that is, it has all the facilities, finished, can be registered and has no violations, explaining the possibility of contracting an apartment under construction, but it must be finished before entering into the initiative.

The Central Bank allocates 100 billion pounds to finance this new initiative, and Najm expected that this amount will cover financing the purchase of 200 thousand units at an average of 500 thousand pounds per unit.

The bank leaders welcomed the new presidential initiative for real estate financing, due to its ability to achieve popularity and development in financing and real estate development and to increase the number of beneficiaries of the targeted segments.

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