On various terms, the government has reduced the mark-up rates on the subsidized housing scheme Mera Pakistan Mera Ghar by one percent.
The reduction is made for Tier 1 housing projects that will be developed by Naya Pakistan Housing Development Authority (NPHDA).
According to the State Bank of Pakistan, the Government of Pakistan (GOP) has decided to revise pricing (mark-up rates and subsidy payment period) under Tier 1 of the captioned scheme, which is used to finance housing units in NAPHDA projects, based on feedback from various stakeholders.
The mark-up or profit rate for the five-year repayment period has been reduced from 3% to 2% as a result of the revision. The mark-up or profit rate for the next five years has been reduced from 4% to 3%. The rates will remain the same for the next year, KIBOR plus 2.50 percent.
Customers could reserve homes up to 125 square yards (5 Marla) in size, with a maximum covered area of 850 square feet. They could also book a flat/apartment with a maximum covered area of 850 square feet.
The maximum price of the housing unit was set at Rs. 3.5 million, with the owner required to contribute Rs. 270,000 as a down payment in order to take possession.
The lower rates may entice customers to book housing units in NPHDA projects, but these projects are too small to serve a large population.
On the other hand, the cost of construction has risen dramatically in recent years, driving up the prices of housing units across the country.
NPHDA has received over 2 million applications for these schemes so far. The authority has acquired lands in Punjab, primarily in urban, semi-urban, and rural areas.
The government claims to have built 20,000 housing units under NPHDA schemes and nearly 45,000 under-construction housing units, but development foundations played a significant role, with the authority serving as a supervisory body.