‘Low mortgage-to-GDP ratio stunts housing industry growth in Pakistan’

KARACHI: With a huge shortage of 7.7 million housing units in the country, the low mortgage to GDP ratio is the main hurdle in the way of growth of the industry.

Association of Builders and Developers Chairman Engr Farooq-uz-Zaman, heading a delegation, stated this in a meeting with State Bank Governor Syed Salim Raza. They discussed the needs of the housing industry, a press release said on Monday.

The ABAD chairman said mortgage to GDP ratio in Malaysia was 31 per cent, South Korea 26 per cent, Thailand 17 per cent, China 15 per cent and India 7 per cent whereas in Pakistan it was 0.7 per cent. “This is very low as compared to the neighbouring countries, which is the main hurdle in the way of revival of economy.”

Listening to the issues being faced by the builders, the SBP governor said the construction industry was the backbone of national economy and in order to play due role it deserved serious steps to be taken to address the issues which were coming in the way of its revival.

Pointing to examples of other countries, he said it would ultimately result in speedy revival of the economy too. He assured the delegation that steps were being taken to implement recommendations of the Housing Advisory Group.

He said ABAD should play due role in the preparation of Large-scale Developers Financing Module. The ABAD delegation told the meeting that the Large-scale Developers Financing Module of Singapore was very advanced and could greatly benefit the builders.

The ABAD team said they would organise a seminar on housing finance by mid-January.
http://www.thenews.com.pk/