Up to16m Egyptians estimated to lack adequate housing (Reuters File Photo)
Economic Update by
With up to as many as 16m Egyptians estimated to lack adequate housing, the government in
In late December, the
According to a statement by the EFSA, the authority has proposed raising the limit on the mortgage-to-income ratio for low-income individuals, allowing more people to benefit from the state's
In January, the chairman of the EFSA,
According to local news reports, the proposed amendments to the Mortgage Finance Law are now under review by the cabinet.
An under-developed market
Although it remains far smaller than in OECD countries,
Despite this success, the market remains relatively under-developed. The value of outstanding mortgages is equivalent to less than 1% of GDP, compared to between 30% and 90% in most OECD countries.
In an interview with OBG last year,
Providing more affordable homes
At the same time the government is looking to ease restrictions on mortgages, it is also stepping up its efforts to supply more low-cost housing. At the end of January,
The homes will come as part of the state-funded construction programme, but the minister said more needed to be done to encourage private investment, noting that improved access to real estate project financing is a priority and is being studied in cooperation with the central bank. "We are studying issues like facilitating loan conditions and changes in some of the procedures that can form challenges for investing in the sector," Mahlab said.
Boosting private sector participation could help ease the shortage of low-income housing. While the government has had a social housing programme in place for decades, it has had difficulties keeping pace with population growth in the country of 80m people. Estimates of the shortfall vary, ranging from 1m to 3m units, and would likely be higher, if inhabitants in informal or sub-par housing were quantifiable.
For the most part, private sector developers have focused on high-end mixed-use developments in suburban areas, on the outskirts of
The result has been an imbalance in
The shortage of affordable residential units has created a surge of illegal construction, with a February report from the
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