EghtesadOnline: Bank Maskan, the agent bank of the housing sector, has allocated loans for the construction and purchase of 260,000 residential units in the first nine months of the current fiscal year to Dec. 21.
According to the news portal of the bank, a majority of the loans were doled out in the form of installment contracts to support the purchase of more than 211,000 homes while close to 49,000 homes were built in the form of civil partnership contracts where the bank and the applicant jointly finance home construction.
“This volume of housing loans indicates that the bank has had a share of higher than 40% in financing the housing and construction sector,” the lender’s nine-month performance report notes, adding that the bank aims to increase this share to at least 50% as part of its roadmap for the next four years.
In the first three quarters of the current Iranian year (started March 21, 2017), the number of loans handed out in the form of civil partnership contracts registered a 39% jump compared with the same period of last year. The number of combined loans both in civil partnership and installment contracts also showed a 25% rise year-on-year.
The value of civil partnership loans allocated to constructors and building investors by Bank Maskan stood at 29.79 trillion rials ($662.18 million) by the end of Q3 while 59.11 trillion rials ($1.31 billion) of loans for purchasing residential units were extended to applicants in the form of loans that did not require the applicant to put down a deposit first.
In the same period, the lender also allocated 8.45 trillion rials ($1.87 million) in facilities that are specifically aimed at renovating, rebuilding or completing the construction of residential units. The loans were received by more than 62,000 home purchasers.
The specialized bank emphasizes in its report that the volume of loans were mostly directed to meet the real market demand. The added value of housing and construction sector increased in the first half of the current year, indicating a long-awaited boom in the beleaguered sector that has been mired in recession for years.
In its performance report, Bank Maskan stresses the positive role of Housing Savings Account, its initiative aimed at first-time homebuyers that requires them to make a deposit and wait for a year to receive the original deposit.
According to the report, more than 272,000 applicants have so far made deposits in the scheme, bringing its total of absorbed resources to 56.78 trillion rials ($1.26 billion).
This shows that the initiative has managed to attract resources equal to three times the amount absorbed by the other savings fund of Bank Maskan called Javanan (youth in Persian) even as HSA is only two and a half years old.
The lender says the loans allocated as part of the scheme currently cover 30% of the purchasing value of a small residential unit in metropolises and 50% of homes in smaller cities. It aims to increase that share in the foreseeable future.
Bank Maskan has another specialized account, which is supported by issuing bonds in the capital market. More than 350 trillion rials ($7.77 billion) worth of deposits have been made with this account. These bonds do not require applicants to make any sort of down payments.
Share of Housing in Bank Loans
Latest statistics released by the Central Bank of Iran indicate that the banking system has allocated more than 4.03 quadrillion rials ($90.65 billion) to all sectors, whereas the housing and construction sector received 355 trillion rials ($7.88 billion) of those facilities.
In other words, about 40 trillion rials ($88.8 million) worth of loans were allocated to this sector each month.
The data indicate that the increase in the number of loans failed to keep up with the value of loans to the sector, as the number rose by 1.8% compared to the more than 5% rise in the value of the loans.
While all other sectors received the bulk of their facilities in the form of working capital, the housing and construction sector was different in that it obtained 41% of its loans in the form of facilities aimed at buying homes.