UGANDA, Kampala | Real Muloodi News | The ability for Ugandans to access affordable housing is becoming increasingly more challenging in the face of increasing land prices, inflation driving up the cost of building materials, and limited access to funding opportunities. High borrowing costs and limited mortgage opportunities make it difficult for many Ugandans to afford a house.
With interest rates rising in Uganda, banks are looking for innovative ways to help customers overcome these challenges to achieve their dreams of home ownership.
Absa Bank and Housing Finance Bank have launched new land and home loans, making it easier for Ugandans to access affordable plots of land and homes under different initiatives.
Absa Bank Uganda- Land Purchase Loan
Absa bank has introduced a land purchase loan to help more people realise their dream of owning a piece of land. Absa Bank’s land purchase loan is a mortgage facility offering up to USh500 million with a 10-year grace period at affordable interest rates.
To introduce this initiative Absa Bank Uganda has partnered with Bakaima Real Estate Agents, a real estate developer, thereby introducing land purchase loans to enable customers to access affordable land and accelerate home ownership in Kampala and other selected cities in Uganda.
“The demand for land remains high, with the biggest reason for purchase being building personal homes. Many are unable to purchase land due to the unavailability of funds and are rarely eligible to get loans from the banks to make or complete their payments. We appreciate this partnership with Absa Bank for it will address one of the biggest challenges to land ownership in Uganda,” said Karim Kawesa, the Managing Director of Bakaima Real Estate Agents.
“Land is one of the most coveted assets in Uganda and a key factor in the housing sector that many of us want to acquire when we start planning for our futures because the purchase of land is a wise investment decision as it appreciates over time and creates motivation to get started on building a home. With this offering, we intend to provide affordable financing that will make land and home ownership a reality for our customers,” said Musa Mai Jallow, the Retail Director of Absa Bank Uganda.
“We intend to partner with more real estate developers to expand access to this facility. With increased urban development, we continue to witness higher demand for land in areas with better health, education, and other essential social services,” Musa Mai Jallow added.
Housing Finance Bank-Incremental Housing Loan
Housing Finance Bank, a wholly government-owned commercial bank, is championing the Sustainable Development Goal (SDG) 11.1 agenda, ensuring that by 2030, all Ugandans have access to adequate, safe and affordable housing.
Therefore, it has launched the Incremental Housing Loan to open opportunities for Ugandans to attain affordable home ownership and financial independence.
The incremental housing loan is under a four-month campaign called ‘Zimba Mpola Mpola’ targeting all Ugandans, whether salaried or in the informal sector.
With the innovation of Zimba Mpola Mpola, anyone can now easily access from USh200,000 to USh50 million in less than three (3) days, and repayable in 3 years for any incremental home building needs like land purchase and home improvement.
Mr Micheal Mugabi, the Managing Director at Housing Finance Bank (HFB) says that HFB is the leading mortgage partner as it commands approximately 60% of all Ugandan mortgage accounts.
“We are fully committed to bridging the housing deficit gap in the country and are always innovating ways to accomplish that. We introduced 100% financing to enable the purchase or completion of residential property, entered a partnership with low-cost housing developers, paved the way for flexible loan repayments and are finally launching to the public the financing of incremental housing projects. All the above initiatives are pointed towards closing the current 2.1 million housing units gap,” said Mr Mugabi.
Every Ugandan qualifies for this loan, including those who are not customers of Housing Finance Bank, as long as they have valid identification, a CRB financial card, proof of reliable source of income, and security like land titles and sales agreements, machinery, and chattels.
In case of construction, a house plan for the titled land should be available, and in the case of Kabaka’s land, the development fee receipts should be attached.
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