The World Bank Friday approved $145 million to expand home ownership including women and the poor through access to affordable housing finance in Pakistan.
The Pakistan Housing Finance Project will support Government of Pakistan’s vision and strategy for housing development, according to a press statement issued by WB here Friday.
The project will extend financial and technical assistance to Pakistan Mortgage Refinancing Company, the Planning Commission, and other institutions to increase availability of mortgage financing for households.
Nearly a third of country’s population does not own homes and this pressure is rising with growing demand, it added.
“This project will spur the development of housing mortgage market in the country and make housing finance affordable and reachable to many Pakistanis.” said Illango Patchamuthu, World Bank Country Director for Pakistan.
“The beneficiaries will include women and low-income groups through improved incentives for ecofriendly homes.”Patchamuthu added.
The project with an innovative approach would help commercial financing for home ownership and provide greater incentives for women to become home owners.
It also incentivizes people to build energy efficient and green homes and adopt climate and disaster-resilient construction designs and materials.
“Pakistan’s mortgage finance to Gross Domestic Product ratio of 0.25 percent is extremely low compared to the South Asia average of 3.4 percent,” said Korotoumou Ouattara, World Bank Senior Financial Sector Economist.
“There is a significant market gap across all segments of the population. The creation of PMRC marks an important step in achieving the Government of Pakistan’s objective to improve access to housing finance in the country. The project will address the liquidity constraints of lenders, support capital market development, and create an enabling environment for a sound national housing policy,” Quattara added.
PHF is financed by the International Development Association, the World Bank’s fund for the poor, with a maturity of 25 years, including a grace period of 5 years.