Low-cost housing projects in full swing


KARACHI:

One of the good things about the Pakistan Tehreek-e-Insaf (PTI) government is that it has set separate goals to improve the lifestyle of people from low-income groups by focusing on affordable housing and free sanitary facilities.

In the past, almost all governments came to power with the promise that they would work for the well-being of the people. However, the common man could not reap the benefits of any efforts undertaken by previous governments.

The sitting government has taken the opposite stance and has taken up the challenge of improving people’s lives by providing them with essentials, such as houses. This would keep the wheels from accommodation, construction and 40-70 other allied industries on the move.

Despite the Covid-19 pandemic giving the sector a difficult time, the challenges posed by the virus failed to derail low-cost housing construction work under the Naya. Pakistan Housing, although the pace of projects slowed down for some time.

The central bank has assigned credit targets to commercial banks for the housing and construction sector (including low-cost units) during the pandemic. The government also slashed the tax rate for the sector as a whole and aggressively lowered taxes on low-cost units. He announced grants and amended the foreclosure law to support housing projects.

“No one thought of making this a priority and providing houses for those who cannot afford their own residences,” Prime Minister Imran Khan said after launching a low-cost housing scheme for workers in Islamabad.

The 1,500-house scheme remained pending for the past 25 years. Granting a subsidy to the houses would lower their prices to Rs 1.8 million for workers, which means they could pay the price in monthly installments equal to the monthly rent while living in their own houses, he said.

Similar projects are in full swing in different parts of the country in collaboration with provincial governments, including Punjab, Khyber-Pakhtunkhwa and Baluchistan. The Lahore Development Authority (LDA) announced a low-cost housing project of 4,000 apartments priced at Rs 1.4 million each. The Punjab government announced the launch of similar projects in 26 tehsils in the first week of April.

“The government and private sector have targeted new housing and construction projects worth more than one trillion rupees for this year,” said Hasan Bakshi, a member of the Prime Minister’s Housing Task Force. “This would not only provide affordable housing to people, but it would also improve production in related industries.”

The government has allowed builders to start new projects without disclosing the source of income until June 30, 2021, allowed projects to be built taking advantage of the facility of reduced fixed tax rates until December 31, 2021, and allowed people to buy. a home without disclosing your source of income through Sept. 30, 2023. Previously, all installments were supposed to expire on Dec. 31, 2020, he said.

“For the low-cost housing plan to be successful, the government is also considering removing the condition of buying a house that will be built in one year,” said Bakshi, who is also a member of the National Coordinating Committee on Construction and Development of Households.

“We are ready to launch low-cost housing projects … of 750-square-foot apartments at a subsidized price of Rs2.7 million each (excluding the subsidy),” he said. “Its current market price is said to be around 4.5 million rupees.”

“Prime Minister Imran Khan is determined to provide five million houses to people during his five-year term (2018-23) and he himself chairs the committee meeting on low-cost housing every week to accelerate the plan,” he said .

In addition, similar meetings are held at the State Bank of Pakistan (SBP) and Naya Pakistan Housing and Development Authority (NAPHDA) on a weekly basis since the government implemented a policy to provide housing units to people belonging to the segment. lowest in the economy.

“The goal of all the weekly meetings is to know the impediments in the way of the projects and to eliminate them,” he said.

The government has reduced the income tax rate on imports of construction machinery to 2% from 6% previously. “It is also considering reducing the sales tax rate on those imports in the next budget (for fiscal year 22),” he said. He said people can own a home through projects the government is launching or they can do it on their own by turning to subsidized bank financing.

Ahmed Ali Siddiqui, director of product development and Islamic law compliance at Meezan Bank, said people were aggressively taking advantage of Islamic law compliant bank financing to own a home.

“About 60% of the total housing finance in Pakistan has been taken from Islamic banks, which are relatively new compared to conventional banks,” he said.

He said the government was considering removing conditions to speed up low-cost housing schemes through bank financing, such as buying a house that is no older than a year and the first lease by buyers.

“Removing such conditions would increase bank financing for low-cost housing units (for individuals).”

the writer is a staff correspondent

Posted in The Express Tribune, March 22North Dakota, 2021.

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