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Egypt central bank allocates LE10 bn for cheap mortgages

Low and middle earners can apply for cheap mortgages in move designed to boost construction and real estate sectors

Ahram Online, Wednesday 19 Feb 2014
Central Bank of Egypt
People and vehicles are seen caught in a traffic jam in front of the Central Bank of Egypt's headquarters in downtown Cairo (Photo: AP)
Views: 1449
Views: 1449

Egypt’s central bank has allocated LE10 billion ($1.4 billion) to finance mortgages for people on low and middle incomes.

The initiative aims to boost the construction and real estate sectors.

Banks will acquire the money from the central bank over a 20-year period at low prices and re-lend it to low earners at a seven percent decreasing rate of return and to middle earners at eight percent.

Low income eligibility will depend on conditions specified in Law 148 (2001), while middle earners can take mortgages worth up to LE300,000 ($43,000).

Eligible individuals will have to be buying houses in new urban communities.

Through the non-banking financial system, the Egyptian Financial Supervisory Authority oversees a mortgage finance fund for low earners. The fund finances individuals earning less than LE1,750 per month and families making a maximum of LE2,500 per month. 

The construction sector took a blow following the 2011 uprising, Federation of Construction and Building Contractors leader Hassan Abdel-Aziz told Ahram Online.

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