Naya Pakistan Housing Program is a flagship initiative of our government. As a measure of socio-economic uplift, this program aims at providing much-needed housing facilities to all citizens, particularly focusing on the underprivileged and middle-income segments of society. Naya Pakistan Housing and Development Authority (NAPHDA) was created to realize this initiative.
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It is a big challenge because, unfortunately, housing for the low and middle-income people was never given due attention in the past. Lack of a structured housing ecosystem and the absence of housing finance were some of the major impediments.
It took us about two years to get a favorable court decision on the foreclosure law which was under litigation. After removing this legal bottleneck, the next issue was to make housing finance affordable for the low-income people so that they could own their house by paying minimal monthly installments, roughly equivalent to their house rent.
Hence, a comprehensive mark-up subsidy scheme was introduced, and Rs 35 billion was allocated for this purpose. To further bridge the affordability gap, another Rs 30 billion were assigned to subsidize the cost of houses. It means that the government would contribute Rs 300,000 for each of the first one hundred thousand houses being built for the low-income people. Taxes on the construction of low-cost houses were also reduced by 90%.
This program will also boost the construction industry, which plays a pivotal role in the growth of more than forty allied industries and offers large-scale employment opportunities, especially to the financially underserved people working on daily wages.
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Consequent to all the policy interventions, incentives, and facilitative measures by the government, low-cost houses are being built at a large scale, not only by government entities but the private sector as well. Housing finance through banks has also picked up significantly. With the launching of the Kamyab Pakistan Program, housing loans on as low as 2% service charges are now available through micro-finance institutions such as Akhuwat. A well-structured system is in place, and I am hopeful that in the coming years, there will be significant growth in the state of affordable housing all over Pakistan.