Govt moves to make housing financing flexible

The government has taken an initiative to make the housing financing flexible with the view to support the housing market and construction.

The government submitted its proposal to Parliament on Thursday, which will make it easier for people to change homes. said the Ministry of Finance in a press release.

The government proposed that the amendments enter into force at the beginning of April.

According to the proposal, the maximum maturity period for new mortgages would be 35 years, rather than the current 30 years.

It proposed that the Financial Supervisory Authority be allowed to cap mortgages at a maximum of 95 per cent of the value of the home for all homebuyers.

The current cap is a maximum of 90 per cent for everyone except first-time homebuyers.

The proposal would allow the regulation of loans to housing companies to be altered by decree in response to the economic cycle.

In new construction, housing companies would be able to borrow at most 60–70 per cent of the debt-free price of the homes to be sold, the duration of loan repayment holidays could be no more that 1–2 years and the maturity period could be a maximum of 30–35 years.