BAKU, Azerbaijan, Dec. 12
By Fakhri Vakilov-Trend:
Uzbekistan’s President Shavkat Mirziyoyev approved a new procedure for providing mortgage loans for housing “based on market principles,” Trend reports citing the Uzbek media.
In accordance with the new procedure, the Ministry of Finance places funds in banks on market conditions for a period of 15 years. Banks, in turn, will provide the population with a mortgage at the expense of these and own funds.
Mortgage loans will be provided at a market rate with the establishment of a maximum loan amount per borrower and the right to independently choose the place and area of housing.
A new procedure for mortgage lending is being introduced in rural areas in areas adjacent to cities and administrative centers of the districts of Andijan, Bukhara, Namangan, Samarkand, Surkhandarya and Ferghana regions. In addition, it will operate in Tashkent, cities of regions and Karakalpakstan.
Mortgage loans under the new procedure are provided for the purchase of apartments sold in the primary housing market on the following conditions:in rural areas - in an amount not exceeding 90 percent of the estimated cost of housing, for a period of 15 years and with an initial contribution of at least 10 percent of the cost of the purchased apartment; in cities - in an amount not exceeding 80 percent of the estimated cost of housing, for a period of 15 years and with an initial contribution of at least 20 percent of the cost of the purchased apartment.
Moreover, the estimated cost of housing will be determined annually by the Ministry of Finance in conjunction with the Ministry of Economy and Industry and the Ministry of Construction, taking into account the average market price of one square meter of an apartment in the corresponding region and the minimum floor space for two- and three-bedroom apartments.
Individuals, including those with low incomes and in need of better housing conditions, will be paid subsidies from the state budget to compensate for part of the down payment and/or interest on the mortgage. Migrant workers, “especially distinguished young families”, women in difficult social situations, members of the Ministry of Defense and the National Guard, and law enforcement officials are also eligible for subsidies.
Subsidies are paid: in rural areas - to compensate for expenses related to the payment of interest on a mortgage loan during the first five years, in part, exceeding 10 percent; in cities - for compensation of expenses related to the payment of a part of the down payment in the amount of 10 percent of the estimated cost of housing, and interest on the loan during the first five years where it exceeds 12 percent in Tashkent, and 10 percent - in the cities of the regions and the Autonomous Republic of Karakalpakstan.
According to the document, in 2020, it is planned to build multi-apartment buildings in rural areas for 4,000 apartments worth $86.5 million, in cities - for 13,750 apartments worth $474.8 million. The number of persons covered by subsidies is expected to be 2,400 in the rural areas and 10,800 in the cities. The resources allocated to commercial banks for lending to the population will amount to $453.7 million, of which $77.8 million for villages and $369.2 million for cities.
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