President Abdel Fattah Al-Sisi issued decree 2014/405 on 11 November to organise and ensure the support of the Mortgage Finance Fund specialising in controlling markets and financial non-bank instruments.
The decree includes 11 articles and was published in the official magazine for law (Al-Waqaa’ Al-Masria) in its last issue. These articles organise the rules governing the work of the fund and its objective and terms of reference.
Head of the Mortgage Finance Fund (MFF) May Abdel Hamid told Daily News Egypt that this decree modifies and extends the terms of reference of the MFF to support the real estate finance activities.
Abdel Hamid said the decree was issued after the amendment of the mortgage law to regulate and develop new measures to the fund. This will allow the fund to keep pace with the amendments to the law and match the new social housing programme.
She added that the mortgage law would facilitate the creation of new housing units in new cities and encourage banks to finance building new housing units.
Abdul Hamid further said that there are 32m properties in Egypt, including over 27m unregistered properties. This amounts to over EGP 2.7tn and it greatly affects the fund’s plans to support low-income citizens.
The presidential decree to establish support of the fund’s activities would not touch on safeguards to restrict the evasion of registration of properties in notary office, according to Abdul Hamid. The amended mortgage law issued by President Al-Sisi in July 2014 did not address the evasion of registration.
“I can’t direct or request the President Al-Sisi to amend the law regulating the Notary Office or include certain articles in the mortgage law, but this is one of the next Legislative Assembly authorities,” said Abdul Hamid.
She added that the Notary Office Law should be amended to ensure there is no evasion of registration and reducing the number of unregistered properties.
“The new real estate tax law will contribute in recording of such unregistered properties,” Abdul Hamid expects.
Economic expert and director of the Center for Economic Studies Salah Goda commented at the decision of President Al-Sisi, saying that the registered properties only account for 7%, which means that only a small percentage will benefit from the fund support.
Goda calls for changing the mortgage law again to ensure mechanism of actions by which non-registered property owners to benefit from the support that the president put forward, stressing that the total value of these non-registered properties up to 93%.