ISLAMABAD – The federal government is working on a plan to offer an interest rate subsidy for 3 and 5 marla houses in the upcoming budget for fiscal year 2025-26.
The PML-N led government is also preparing an affordable package with a repayment period of 10 to 12 years, reports said on Saturday.
Given the estimated shortage of 14 million housing units in the country amid swelling population, the government is working on an affordable package for 3 and 5 marla houses in the next budget.
However, the Prime Minister’s Office (PMO) is also working to expand this potential subsidy for 10 marla residential units for first-time homeowners across the country. But the International Monetary Fund (IMF) may raise objections to this proposal.
The estimated annual cost of the interest rate subsidy for 3 and 5 marla houses could be between Rs50 to Rs70 billion, but for 10 marla houses, the cost will certainly be higher.
The banking sector in the country has faced difficulties in mortgage financing and has raised the issue of stay orders from courts during the repayment of outstanding loan installments.
Legal changes have been made, but further procedural requirements are required for creating obstacles to the promotion of mortgage financing in Pakistan.
In recent meetings regarding affordable housing, representatives from almost all banks raised concerns about the legal hurdles in recovering outstanding installments.
Therefore, before promoting the construction and housing sector on a large scale, consultations have been held with the Ministry of Law to resolve this issue.
