Uzbekistan's mortgage lending market experienced significant growth in 2023, expanding by 17% compared to the previous year, Kursiv reports. A recent report from the Central Bank of Uzbekistan reveals that the state played a pivotal role in this growth, accounting for over half of the total loan volume through the implementation of the so-called New Order.
State support fuels mortgage lending
According to data from the financial regulator, the Ministry of Finance facilitated the distribution of UZS 8.66 trillion ($702.2mn) to borrowers through bank operators. This substantial financial support enabled banks to extend housing loans amounting to UZS 5.71 trillion ($463mn) from their funds, reflecting a 1.5-fold increase over the year.
Mortgage refinancing company's contribution
An additional UZS 1.57 trillion ($127.3) was allocated to the Mortgage Refinancing Company, further boosting the mortgage lending market. As a result, the total amount of mortgage lending during the review period reached an impressive UZS 16.85 trillion ($14bn).
Increased accessibility of housing loans
From January to December, a noteworthy number of individuals, exceeding 68,000, benefited from loans to purchase housing. The New Order, introduced by the Ministry of Finance, offers housing loans at an attractive annual interest rate of 17-19% for the acquisition of apartments in the primary market, as well as for house construction and reconstruction.
Steady growth and loan balances
The remarkable growth in the mortgage lending market is underscored by the fact that the balance of mortgage loans at the beginning of the year stood at UZS 58.2 trillion ($4.7bn). Such figures indicate a positive trend and a growing demand for housing loans in Uzbekistan.
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