Shavkat Mirziyoyev signed a decree on February 24 on the efficient organization of multi-apartment building construction and the acceleration of efforts to provide housing to the population.
The President approved a proposal to conduct an experiment in Uzbekistan with targeted mortgage deposits based on “advanced international practices.” These deposits will be used to cover down payments under the subsidized mortgage program.
The experiment will begin on July 1 and run until the end of the year. During this period, citizens whose applications for mortgage subsidies have been approved will be able to open a mortgage account with a commercial bank during the notice period.
The mortgage deposit amount must be equal to or greater than the down payment, calculated based on the maximum refinanced loan amount. Subsidies allocated to cover the down payment are transferred as an advance payment to form part of the minimum deposit amount.
Funds can be held in a mortgage deposit for up to 12 months. During this time, banks will accrue interest on the remaining funds at the market rate, which will be used, along with the principal, to form the down payment.
If the depositor fails to purchase an apartment before the end of the mortgage term, the funds in the account, along with interest, will be returned proportionally to the depositor and the state budget.
Payment of subsidies intended to compensate for mortgage interest above the Central Bank’s base rate (currently 14%) will begin after the loan is issued upon the bank’s application. Regulations for the implementation of the pilot project for mortgage deposits have been approved by June 1.
Plans to introduce targeted mortgage deposits in Uzbekistan were announced in December 2021. At the time, they were intended to operate based on tripartite agreements between the homebuyer, the developer, and the bank.
The English version of this material was generated with the assistance of AI translation tools and may differ slightly from the original text.
