Alternative to privileged loans
By Denis Kirillov
In Belarus, 850,000 families are currently on the waiting list for accommodation (including 280,000 in Minsk). Naturally, privileged loan terms cannot be offered to everyone, so the criteria for such loans have been toughened. On average, only a third of those on the list can hope to receive a low interest rate mortgage under existing regulations.
The Head of the Architecture and Construction Ministry’s Department for Housing Construction, Alexander Gorval, tells us, “You have to save a deposit, take out a mortgage or purchase housing bonds. We aim to launch new mechanisms to help citizens use their own funds.”
The new Housing Code will receive its second reading at the National Assembly’s spring session. It gives permission for banks to grant mortgages tied in to the value of flats being constructed or owned (failure to meet repayments brings repossession of the property): the Law on Mortgages was originally adopted in 2008 but has not yet come into force.
Meanwhile, the Law on Construction Savings is to commence, allowing construction companies to fulfil direct orders from the state — rather than housing-construction co-operatives. Mr. Gorval comments, “We want people to gain access to ready-made housing (without problems relating to pricing per square metre or construction schedules). When they reach the top of the list, they are free to choose a house or flat, even selecting their view from windows. They need only move in if everything meets their expectations — either with state support or not.”
A database of accommodation for rent is also being established, with Minsk immediately offering 48 flats and 8 rooms. Commercial apartment buildings are to be constructed and transformed into hostels, with rooms rented by the state to those on the list, for an unlimited time period. Moreover, the state will apply a flexible approach to the price of a square metre.
Those on the waiting list will also be able to take land lots free of charge, building their houses independently. At present, village councils have over 70,000 such sites but only a few are truly attractive (most lack necessary infrastructure, roads or prospects for development). According to Mr. Gorval, executive committees need to find more appropriate plots. “We’re studying the possibility of preparing various projects for individual houses — for people to choose from. The state can help not only financially but by selling timber, sand and gravel at modest prices.”
Construction companies need to change their strategy, offering a wider range of services. The new housing policy aims to support consumers of construction services and construction sites.