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Building and rebuilding - 22 June 2007

You would be forgiven for thinking that the arrival of a new mortgage product isn’t usually something that makes the news on most days. However, this is an important and historic mortgage product, bearing in mind it is for property in the capital of Afghanistan, Kabul.

A few miles north of the city, a new development of homes is under construction, which will not only push forward the housing market in the country, but also go some small way to helping to solve the chronic housing shortage. Over 25 years of almost-continuous conflict has destroyed over a third of the housing stock in Afghanistan, and this new development, called New Kabul, is being seen as an innovative and ambitious experiment.

The project will see the country’s banks buying the properties from the government, and then selling them to customers who will, over period of around 16 years, pay a mortgage of $100 to $150 monthly to become the outright owners, reports BBC Online.

Such has been the shortage of housing that the rental market has escalated to an extent where ordinary citizens with an average per capita income of $380 have little or no hope of renting, let alone buying a property themselves. A result of this has been that some 63 per cent of the homes in Kabul are illegally built, without plans or access to sanitation.

As the military situation in the southern parts of the country in particular continues to be a cause for some concern, news of improvement in the housing situation will be welcome indeed.

 


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