President Launches Urban, Rural Revitalization Scheme

As per a recent presidential order, the cheapest loans in Iran are to become more affordable with the aim of accelerating the revitalization program for distressed urban and rural areas.

President Hassan Rouhani was joined on Thursday by a host of high-level officials from the Ministry of Roads and Urban Development and the Central Bank of Iran to mark the launch of a national urban revitalization program called Hope.

Rouhani called on CBI Governor Valiollah Seif to reduce the interest rates for loans aimed at purchasing and revitalizing homes in distressed areas from the Housing Savings Account from the current 8% to 6%, the presidential news portal said.

HSA is a popular initiative spearheaded by Bank Maskan, the agent bank of the housing sector, created for boosting the purchasing power of people, especially first-time homebuyers, that requires applicants to make down payments and wait for a year to become eligible for loans. 

Bank Melli Iran also recently entered the fold by founding its own savings account to extend loans for purchasing homes.

Bank Maskan had reduced the interest rates on loans received on the back of housing bonds for residents of distressed areas from 17.5% to 16% last week.

Rouhani also asked the CBI chief to consider the 8% interest for all married couples, regardless of the area in which they wish to purchase homes.

"With the implementation of this scheme, not only distressed neighborhoods will be strengthened, but the people's capital base will also be increased," the president said.

Stressing that the interest rate reduction is feasible, Seif said more than 68 trillion rials ($) worth of credits have been projected for the housing sector that is expected to come out of its longstanding stagnancy during the next fiscal year starting March 21.

Roads Minister Abbas Akhoundi was also in favor of reducing the interest rates on loans for distressed areas and said reducing the current waiting period of one year to 10 months for depositors to become eligible for loans would be another positive measure.

"Our fundamental policy is to empower this organization both collectively and individually," he said.

The minister said the strengthening policy would translate as a return to an "Iranian urban identity" while individually, people living in cities will receive support for improving their livelihoods.

Akhoundi said 2,700 neighborhoods stretching across 543 cities and 141,000 hectares of urban areas have been identified as "inefficient living areas" that are home to 19 million people, while revitalizing distressed areas would mean that the lives of more than six million households will be impacted for the better.

"Even if three million residential units are revitalized in 10 years, one of the biggest urban revitalization programs in the history of Iran or even on the international scale has been implemented," he said.