Bangladesh lags behind in ensuring affordable housing for all: Stakeholders
Currently, there is a demand of 60 lakh units of houses against an annual supply of only 31,500 units
Bankers, economists and housing sector experts at a programme said that the government is lagging in housing policy compared to many countries that can ensure affordable housing for all.
"There is a need for strong government policy for housing, land price, transparency, non-digitised records and housing finance. There is also a need for a special Bangladesh Bank window to support affordable housing," they said at a roundtable discussion organised by the Policy Research Institute (PRI) of Bangladesh and International Finance Corporation (IFC) titled 'Final Roundtable on Affordable Housing Sector- Roadmap Development' at a city hotel on Wednesday.
According to 2022 IFC data, currently, there is a demand of 60 lakh units of houses against an annual supply of only 31,500 units, of which 17,000 units are provided by the private sector. The demand will rise to 10.5 million by 2030.
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To meet the increasing demand, the per annum requirement of houses is 2,49,000 units, the IFC data stated.
The data also stated that currently there is a financing requirement for 35 lakh (3.5 million) houses for which there is a potential for Tk4.9 trillion for affordable housing in Bangladesh.
The speakers urged the government to develop a policy prioritising the housing sector to ensure housing for all. They also called upon the Bangladesh Bank to take initiatives to provide long-term home loans at easy terms and conditions. Besides, the Khas lands of the government should be utilised for low-cost housing projects for the lower income group in which the private sector should come forward with investments.
In the keynote paper, Thierno Habib Hann, Global Housing Finance and Capital Markets-Asia Pacific Lead and Ayesha Baig, Senior Operations Officer, Financial Institutions Group (Upstream), International Finance Corporation, said that the government should consider subsidies for incentivising the building and financing of green affordable housing. Mortgage refinance companies (MRC) have to follow the Indian National House Building Bank's model and Bangladeshi housing finance companies can be regulated by the Bangladesh Bank under a separate regulation for housing loans.
Moreover, the government has to take initiative to ensure housing loans by SMEs and other non-banking finance institutes. Public-private partnership (PPP) model for affordable housing should be explored along with the affordable housing fund as per the experience of the Tamil Nadu shelter fund. PPP experience from other countries should be leveraged upon, they added.
