Con­struc­tion and hous­ing bank to ex­tend du­ra­tion on lend­ing for low-cost hous­ing

The Myanmar Times - - Business - Za­yarlinn@mm­ ZAY YAR LINN

LOW-COST hous­ing res­i­dents who have bor­rowed to buy their homes could be given nearly twice as long as they ex­pected to pay back their loans, a lead­ing bank has an­nounced.

U Win Zaw, man­ag­ing di­rec­tor of the Con­struc­tion and Hous­ing De­vel­op­ment Bank, told The Myan­mar Times on Oc­to­ber 14 the goal was to avoid over­load­ing buy­ers with overly oner­ous re­pay­ment plans.

“We’re pre­par­ing to in­crease the re­pay­ment pe­riod from eight years to 15 for cus­tomers who have taken out a loan for low-cost hous­ing,” he said. “We’re wait­ing for the fi­nal con­di­tions to be put in place be­fore we con­firm the plan, and then we will im­me­di­ately im­ple­ment it,” he said.

A joint ven­ture be­tween the gov­ern­ment and a pri­vate firm, un­der the Min­istry of Con­struc­tion’s su­per­vi­sion, the Con­struc­tion and Hous­ing De­vel­op­ment Bank was es­tab­lished in Jan­uary 2014 to pro­vide long-term loans for home buy­ers and to spur the de­vel­op­ment of lo­cal con­struc­tion com­pa­nies. The only hous­ing de­vel­op­ment bank in the coun­try, it was launched with K100 bil­lion in cap­i­tal and 46 share­hold­ers.

The first home loans were granted to buy­ers in the Shwe Linn Ban low­cost hous­ing de­vel­op­ment built by the con­struc­tion min­istry and the Depart­ment of Ur­ban and Hous­ing De­vel­op­ment in Oc­to­ber 2015.

U Win Zaw said the grant­ing of loans would de­pend on an as­sess­ment of an ap­pli­cant’s abil­ity to af­ford a home, how much money they could pay per month and whether they could af­ford the 30 per­cent down pay­ment.

An ini­tial re­quire­ment to re­pay the loan within four years had al­ready been dou­bled to eight years be­cause so many ap­pli­cants faced dif­fi­cul­ties in meet­ing the pay­ments, as well as the 30pc down pay­ment, he said.

“Un­der the pre­vi­ous gov­ern­ment, low-cost hous­ing was sold to peo­ple un­der the lot­tery sys­tem. But many of the lucky win­ners could not ac­tu­ally af­ford the apart­ments,” he said. “In the case of the Shwe Lin Ban low­cost hous­ing de­vel­op­ment, we found that very few peo­ple could af­ford the K4 mil­lion re­quired for the 30pc down pay­ment for a K12 mil­lion apart­ment. Nor could they make the re­pay­ments over four years. We lent them the money over an eight-year pe­riod, and now we will in­crease that to 15 years,” he said.

The cur­rent gov­ern­ment plans to build 8000 apart­ments priced at un­der K10 mil­lion in Dagon Seikkan, Min­gal­adon and Than­lyin town­ships, Yangon Re­gion, as an ini­tial project.

“We’ve al­ready in­vited peo­ple to buy low-cost apart­ments by open­ing a Hous­ing Sav­ings Ac­count at CHDB,” said the bank’s deputy di­rec­tor, U Min Aung Aye. “Ap­pli­cants can pay the first 30pc through the CHDB. We will give pri­or­ity to peo­ple who have Hous­ing Sav­ings Ac­counts.”

A to­tal of 2208 apart­ments in Yuzana and Kanaung low-cost hous­ing projects in Dagon Seikkan town­ship and the Shwe Lin Ban project in Hlaing Thar­yar town­ship will soon go on sale to the pub­lic for prices rang­ing from K12 mil­lion for a ground-floor apart­ment to K9,800,000 for a fourth-floor apart­ment.

The Con­struc­tion and Hous­ing De­vel­op­ment Bank has so far loaned K7 bil­lion to more than 500 home buy­ers and K90 bil­lion to more than 200 com­pa­nies. More than 5000 peo­ple have opened Hous­ing Sav­ings Ac­counts with the bank since Au­gust.

The Min­istry of Con­struc­tion’s DUHD says it will build up to 200,000 low-cost units through­out the coun­try over the next five years. – Trans­la­tion by Emoon

and Win Thaw Tar

Photo: Staff

A man works on a hous­ing project site in the south of Dagon Seikkan town­ship.

Newspapers in English

Newspapers from Myanmar

© PressReader. All rights reserved.