The government has started implementing a subsidised housing scheme aimed at promoting the construction of low-cost homes across the country, introducing major incentives for homebuyers and builders.
Under the new policy, the limit for the housing loan has been escalated from Rs3.5 million to Rs10 million, while the loan for houses up to 10 marla will also now be available at a fixed interest rate of five per cent. The government will give a subsidy of Rs322 billion during the first year, in which markup subsidies would be Rs282 billion and Rs40 billion for risk-sharing costs.
According to official documents, the scheme aims to build 500,000 houses in the next four years. The rate of interest for housing loans has been cut down from eight per cent to a fixed five per cent, and the borrowers who availed the loans at eight per cent will also enjoy the reduced rate.
The scope of the allowable house under the scheme has been extended from 5 marla to 10 marla with a maximum covered area of 2,720 square feet. Apartment sizes have since grown as well, from 1,360 to 1,500 square feet.
The government plans to build 50,000 homes by June 2026 in the 1st phase, followed by 100,000 homes by June 2027, at an additional 150,000 homes by June 2028, and an additional 200,000 housing units by June 2029.
One of the main characteristics of the scheme is that it allows a reduced marking rate of five per cent of all eligible houses and flats, compared to the previous eight per cent rate.
Loan repayment time periods of up to 20 years have been implemented to alleviate monthly payment burdens, with the government covering markup subsidies for the first 10 years. Banks have been ordered to facilitate financing up to 90 per cent, making applicants only contribute 10 per cent of the entire cost.
Eligibility Criteria
Only Pakistani citizens with a valid computerised national identity card (CNIC) will be eligible for the scheme. Applicants will not be able to buy a residential property in Pakistan, as the initiative is specifically available for first-time homebuyers.
Eligible applicants can apply for a loan for building a house on a plot lying under the scheme, buy an already constructed home or apartment or buy a new plot and construct a house under the scheme.
