The government has introduced the Mera Ghar – Mera Ashiana housing finance initiative on Wednesday, aimed at improving access to affordable housing.
According to the details available on the State Bank of Pakistan’s (SBP) website, the scheme offers a markup subsidy and risk-sharing mechanism to assist eligible citizens in purchasing, constructing, or expanding homes. It is open to individuals holding valid CNICs who do not already own a housing unit.
The financing options available under the scheme include loans for purchasing a house or flat, constructing a house on an owned plot, or purchasing a plot and constructing a house. Eligible housing units include houses of up to five marla or apartments of up to 1,360 square feet.
The loan structure is divided into two tiers:
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Tier 1: Loans of up to Rs 2 million at a fixed end-user rate of 5%.
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Tier 2: Loans above Rs 2 million and up to Rs 3.5 million at a fixed end-user rate of 8%.
The maximum loan tenor is 20 years, with the markup subsidy applicable for the first 10 years. Borrowers will need to contribute 10% equity, while banks will provide up to 90% financing. The loans will be priced at 1-year KIBOR + 3%, with no processing charges or prepayment penalties. Additionally, the government will offer 10% first-loss coverage on the outstanding portfolio to mitigate risks.
Financing will be available through all commercial, Islamic, and microfinance banks, as well as House Building Finance Company Limited (HBFCL). SBP has directed participating financial institutions to ensure proper dissemination of the scheme and implement necessary measures to avoid misuse. Details on the disbursement of markup subsidies and credit loss coverage will be provided separately by the SBP.
