Adding two more components to the program formulated by the government to provide equity assistance needed to take loans for home construction and purchase, the Housing Ministry today signed MOUs with the participation of four financial institutions.
The "Help to Build" and "Help to Buy" programs, run to provide equity for loans taken under the "National Home Ownership Program," were launched today in collaboration with BML, MIB, HDFC, and Maldives Housing Finance Leasing (MFLC).
The Housing Ministry noted that the Maldives Urban Development and Reconstruction Project (MUDRP), conducted with the assistance of the World Bank Group, showed that the biggest obstacle faced in building and purchasing homes is the difficulty encountered in paying the equity payments specified by banks.
Therefore, the ministry stated that the objective of the two components added to the National Home Ownership Program today is to assist landowners who have not been able to construct homes due to financial difficulties and individuals purchasing homes for the first time.
Help to Build
- The government will provide assistance to landowners who lack an adequate place to live to obtain a bank loan for home construction.
- This component is targeted at Malé and inhabited islands across the atolls. (Hulhumalé, Vilimálé, Gulhifalhu, and Giraavarufalhu will not be included in this)
- The government will provide free aid up to MVR 200,000 for the equity payment of a loan worth MVR 1 million.
- In a situation where more than one owner joins together to construct on a family plot of land, equity payment for the loan will be arranged up to MVR 1 million at a rate of MVR 200,000 per head. This rule will apply only to lands in Malé.
- Looking at the design and BOQ, even if a loan exceeding MVR 1 million is taken, the maximum amount of aid provided by the government is MVR 200,000 per head.
- This is non-repayable aid. However, if the building is sold within 20 years, that money must be repaid to the state.
Help to Buy
- Affordable Housing: Free aid up to MVR 250,000 will be provided to purchase an affordable housing unit valued at MVR 1.5 million built under PPP model. (This is a scheme run separately from the 2024 'Hiyaavahi' scheme)
- Market Rate Units: Free aid up to MVR 250,000 will also be provided to first-time buyers purchasing a unit sold at market price on a real estate basis.
- This aid money will be paid directly to the developer through financial institutions. And that amount will be deducted from the total price payable by the buyer.
Under this program, assistance will be received by parties who do not have any other land or plot constructed in the applicant's name. And the land being constructed on must be the private property of the applicant or applicants.
Although this loan is mainly targeted at constructing a house to live in, the ministry stated that permission will exist to use part of that building commercially.
Speaking at the ceremony held to launch the equity release program, Housing Minister Dr. Abdulla Muththalib stated that the MOUs signed today are part of the work being done by the government to facilitate housing ease for citizens.
"The government's housing policy, housing for all, this policy is built upon facilitating citizens to obtain flats and homes constructed by the government, and facilitating citizens to obtain shelter by selling affordable homes constructed by private parties with government assistance at affordable prices, and securing opportunities for citizens to construct on their own land by providing financial assistance from the government in various ways, as well as securing opportunities to purchase private housing with government assistance," Muththalib said.
According to the minister, one purpose of the program is to facilitate housing units constructed by the government to be obtained by the most vulnerable people.
