Naya Pakistan Housing Society: The Insider of Subsidy
Naya Pakistan Housing Society is the initiative of the Government of Pakistan (GoP). The main is to provide shelter for the low-income strata of the society. Recently, GoP has announced PKR 30 Billion housing subsidy for Naya Pakistan Housing Society. This subsidy will be given to 100,000 houses (One Time). It would be considered as a down payment of the mortgage.
Mark-up ease has also been announced in the form of mark-up subsidy. As per the latest news, the mark-up subsidy will work as mentioned below:
- 5% mark up for 5 Marla Houses
- 7% markup for 7 Marla Houses
The government themselves will subsidize the variance between this market rate & 5-7 % concessionary rate, announced for this scheme.
In light of the above-mentioned mark-up subsidy, the additional burden of almost PKR 6 Billion to 9 Billion will fall on the government. The amount may fluctuate depending upon the total tenor of the loan. Moreover, this estimated burden calculated for initial 100,000 houses, not 5 million. An immediate help might be needed from the World Bank in order to keep this project on track.
Critics on Subsidy Policy
The critics of this project said that there is a huge lack of adequate research that supports the suppositions made for this project. They believe that there is a major black hole on the information. There is no satisfactory survey or investigation regarding the housing stock and house shortage. Also, the announced mortgage policy designed ignoring the metrics of affordability for the common man. Keeping in view of the cost of land, there was a need for vertical development instead of horizontal sprawl.
News Source: Nation