MPs Criticize Mortgage Decision
Economy, Business And Markets

MPs Criticize Mortgage Decision

Contrary to liberal experts hailing the Money and Credit Council’s new move to raise mortgage ceilings, two parliamentarians cast doubt whether the decision could have a positive impact on the struggling housing market.
According to the approvals of the council, mortgage ceiling would increase to 800 million rials ($27,000 at official exchange rate) for first time buyers in Tehran and to 600 and 400 million rials in big cities and towns respectively. The loan would be provided via the establishment of “housing deposit fund” in banks at an interest rate of 14 percent for 12-year repayment schedule.
Moreover, all private and state-owned banks are now free to grant home loans, in addition to the traditional mortgage provider Bank Maskan.
Rouhollah Beigi Eylanlu, an economic committee member in the parliament, warns that the ceiling increase can push up house prices. He argued that high installment payments and repaying more than twice the amount of the original loan is not in consonance with the MCC’s objective which is to help middle-income households buy a house, Islamic Consultative Assembly News Agency (ICANA) reported.
The lawmaker believes that the mortgage repayment schedule is not compatible with Islamic banking. “Banks should provide cheap loans but they are trying to maximize profit,” he added.
Mohammad-Ghasim Osmani, another MP who opposed the effectiveness of the MCC’s decision, said low and middle income households cannot afford the installments, warning that the move could lead to a foreclosure crisis.
The Central Bank of Iran has recently released a report saying that the average price of an apartment per square meter is 37.4 million rials in Tehran. 

Short URL : http://goo.gl/5poJ0P

You can also read ...

US Sanctions on Iran Affect Trade With UAE
The latest US sanctions against Iran are forcing many Iranian...
Failure to Safeguard Iran Deal Will Show EU Still a Paper Tiger
Just a few weeks ago, it seemed that the Iran nuclear deal...
Iraq to Respect Dollar Ban But Not All US Sanctions on Iran
Iraqi Prime Minister Haider al-Abadi stepped back from his...
Indian Tea Exporters Seeking Special Exchange Rate From Iran
The Indian tea industry has sought a special exchange rate...
Gold Coin Gains
The benchmark Bahar Azadi gold coin gained on Tuesday, as both...
New Government Policies Reduce Forex Demand
The implementation of new foreign exchange policies by the...
Nvidia Rolls Out New Chip Technology for Filmmakers
Nvidia Corp on Monday released a new generation of chips aimed...
Google Tracks Your Movements, Like It or Not
Google wants to know where you go so badly that it records...