• May 26th, 2022
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• by Admin

National Homeownership Fund To Offer Maximum 12% Interest On Mortgages: Ofori-Atta

Potential mortgage seekers received welcoming news from The Minister for Finance as he reveals that the interest rate for mortgages under the National Homeownership Fund (NMF) would be as low as 11 percent. The Minister disclosed this in the Mid-Year Fiscal Policy Review of the Budget Statement and Economic Policy of the Government of Ghana delivered on 29th July 2021. The cost of mortgages in the country is very high as interest linger around 24 percent and over. Among the reasons being that, commercial banks which are essentially deposit-taking institutions and therefore reluctant to give out long-term loans like mortgages due to their maturity mismatch need to compensate for the long-term risks. More so, the general lending rate at which commercial banks borrow from the Central bank is also relatively high. Hence the banks normally would have to be compensated for these risks in giving out loan term loans such as mortgages. Many industry players have called for the government’s deliberate intervention in this regard. The Minister speaking at the precinct of Parliament noted that the government is providing funds to the National Homeownership Fund in support of its agenda to provide sustainable and completed affordable housing, adding that the funds would be provided for prospective mortgage seekers and upper limit of 12% interest rate. “This fund, to be matched by participating financial institutions, will provide low blended mortgage interest rates of between 11% to 12% as compared to the current market rates between 25% to 26%. Through this intervention, which builds upon and expands the pilot project implemented last year, our quest to promote residential homeownership while boosting the domestic construction sector to provide more jobs, is on course,” says the Minister. Ghana’s housing deficit is estimated to be over two million units and a new path has to be chatted to curb the situation. Source: Mohammed Bomanso Issah(Real Estate Times Africa)

orginal source :

https://realestatetimesafrica.com/news/housing/945/National+Homeownership+Fund+To+Offer+Maximum+12+Interest+On+Mortgages++Ofori-Atta