Egypt’s central bank has announced the allocation of 100 billion pounds to finance the real estate sector in the country as part of a new initiative through banks or real estate finance companies.
This step aims to finance the purchase of housing units for low- and middle-income people at a decreasing interest rate of 3% for a period of up to 30 years.
Egypt’s central bank said in a statement that the new initiative applies to low-income people whose income and units are determined through the Social Housing Fund and real estate financing support.
The initiative targets low-income people whose maximum monthly net income is 4.5 thousand pounds for a single individual and 6 thousand pounds for a family.
The value of the unit allocated to this category is 350 thousand pounds, and a 10% down payment is to be paid.
With regard to average incomes, the maximum net monthly income is 10,000 pounds for a single individual, and 14,000 pounds for a family, and the unit price for this category is estimated at 1.1 million pounds as a limit, with a minimum down payment of 15% of the total unit value.
For units whose price exceeds 1.4 million pounds, a minimum down payment of 20% of the total unit value is required.
Terms of the initiative
The initiative requires that the beneficiary should be of Egyptian nationality. Those with free professions, crafts, people with special needs who have income and pensioners can also benefit from the initiative, provided that the age of the beneficiary does not exceed 75 at the end of the financing period.
The terms of the initiative also include that the units be for permanent housing only, not seasonal, and that the units be fully finished and ready for housing, while allowing banks to accept alternative guarantees in the event that the unit cannot be registered and therefore cannot be mortgaged.
Egyptian President, Abdel Fattah El-Sisi, had directed the central bank to crystallize 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, with long-term loans of up to 30 years and a low and simplified interest that does not exceed 3%, according to a statement of the official spokesman for the Presidency of the Republic, Bassam Rady.
According to the data of the Central Bank, the rate of return on deposit and lending per night and the price of the main operation of the Central Bank is currently 8.25%, 9.25% and 8.75%, respectively. The credit and discount rate is 8.75%.
The official spokesman also stated that the President has met with the Governor of the Central Bank, Tariq Amer, to review the activities of the Central Bank within the framework of the monetary and financial system of the state.