The Mortgage Finance Fund (MFF) board issued a decision to stop accepting very low-income applicants for social housing units.
MFF said such applicants do not comply with the financing rules of the banks because their income is lower than the permissible limit to access appropriate funding for the unit price.
“I do not benefit from the low-income housing project developed by the government because they demand many papers, including insurance and I get paid on a daily basis and do have a fixed job,” wageworker Mohamed Saeed said.
“I sometimes earn EGP 2,500 in one month and EGP 500 in other months; I depend on the availability of work.”
“People who are in my the same condition as I are excluded from the mortgage fund system in Egypt, as if we do not have the right to live in good houses and clean places,” he said.
About 1,000 applicants for social housing units in New Cairo and Dahshour in Giza were excluded out of 79,000 applicants in New Cairo and 65,000 in Dahshour due to their very-low income, MFF Head May Abdel Hamid said.
Chairman of the Egyptian Contractors Alliance Omar Tahtawy said the demand on social housing projects is very high and the existing units do not cover the citizens’ needs. The crisis persists despite the existence of seven million uninhabited units.
Tahtawy said 40% of low-income Egyptians are unable to apply for social housing projects developed by the government due to their extremely limited financial resources. The aim of launching the project was to launch a comprehensive urban renaissance.
MFF’s refusal to increase the housing projects and address the number of informal and illegal buildings is because some low-income individuals are unable to pay loans to rent homes, and so escape responsibility for their dued, he said.
“Combating the housing crisis requires the government to develop a comprehensive national plan to address the issue of informal settlements that includes re-planning and the provision of infrastructure and facilities and to improve the quality of life and public health within a specified period,” Tahtawy said.
Member of Real Estate Investment Division at the Federation of Egyptian Chambers of Commerce (FEDCOC) and CEO of Beta Egypt for Urban Development, Alaa Fikri, said the mortgage system is hindered because of the large number of documents required from clients to receive funding, the long procedures and bureaucracy, and the high interest rates on financing units that range from 14% to 17%.