Maskan Mortgage Ceiling  Doubled for Newlyweds
Economy, Business And Markets

Maskan Mortgage Ceiling Doubled for Newlyweds

The Money and Credit Council agreed Tuesday to double the ceiling of Bank Maskan’s Housing Saving Account mortgage for newlyweds.
According to the directive, home loans for the newly married will be raised to 1.6 billion rials ($52,900) from the previous 800 million rials in Tehran. In other urban areas other than Tehran, young couples will receive 1.2 billion rials ($39,700), up from 600 million rials in the past. Those in towns with a population of less than 200,000 will qualify for 800 million rials ($26,400), twice the paltry 400 million rials.
The top policymaking council had agreed in May to almost double the borrowing limit for first-time buyers in Tehran to 800 million rials. Another significant decision made by the council was the de-monopolization of the mortgage market. Since 2008, Maskan had been the only commercial bank authorized to offer housing loans. Now other lenders are free to join the club. However, a fund dedicated to helping home buyers — the housing deposit fund — must first be created in the banks.
In a turnaround on Tuesday, the MCC allowed Bank Maskan to offer housing saving account mortgages to any applicant purchasing renovated homes in distressed urban areas even if they are already homeowners, the Central Bank of Iran reported on its website.  
The loans may finance up to 80% of a house price.

 Still Not Enough
Based on CBI data, an average 80-square-meter housing unit costs 2.8 billion rials in Tehran. This means that the new ceilings will barely cover 50% of a home value. Since it will take at least six months to one year for applicants to receive the loans, home prices may rise by the time the loan is approved, further reducing its buying power. Ideally a loan should cover at least 80% of the value of a home, as is the case in many countries.
The ceiling of Bank Maskan loans included in the Housing Premium Fund was also raised, providing homebuyers, both first-time and others  with 600 million rials (19,800) -1 billion rials ($33,100) based on their dwelling places. Before the loan was 400-600 million rials ($13,100-$19,800).
Housing Premium Fund loans are offered as a supplement to Maskan’s usual mortgages for buying or building homes, however absolving the need for any initial deposit.
The CBI hopes the new measures will help pull the housing market out of the long and painful recession and lift the national GDP because the housing sector is capable of attracting investments and creating the much-needed jobs.

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