Task Force for Housing sector development holds second meeting

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ISLAMABAD, Jan 27 (APP):Federal Minister for Housing and Works Mian Riaz Hussain Pirzada on Monday chaired the second meeting of the Task Force for the development of the housing sector, which aims to address the challenges facing this critical sector.

The meeting was attended by Minister for Finance and Revenue Muhammad Aurangzeb, Minister of State for Finance and Revenue Ali Parvez Malik, Chairman of the Federal Board of Revenue Rashid Mahmood Langrial, and other key members of the Task Force.

The Task Force was established by the prime minister, consisting of representatives from relevant government institutions and professionals from the private sector, particularly those working in the real estate industry.

The group is tasked with presenting a consolidated report and recommendations for the revival of the housing sector.

During the meeting, four working groups were highlighted: Taxation Issues, Access to Finance, Urban Planning and the

Real Estate Regulatory Authority (RERA), and Growth Framework for Housing. Experts from each group presented their deliberations and concrete recommendations to address these challenges.

A detailed presentation was given on the current challenges faced by the housing sector, including a gap of 12 million housing units, urban sprawl, planning constraints, government regulatory inefficiencies, and unsatisfactory private sector involvement.

Concerns were raised about the high costs associated with taxes on property transactions, capital gains, and excessive property valuations, along with cumbersome tax procedures.

Access to finance was another major topic of discussion, with members highlighting the low mortgage penetration by banks and the high interest rates on housing loans.

After thorough discussions, it was agreed that policy and banking reforms are urgently needed. These reforms would introduce low-cost housing subsidies with fixed terms and lower policy rates to support the low-income population’s access to housing finance. It was emphasized that the policy rate should ideally be in the single digits to facilitate smoother access to housing loans.

Innovative solutions, such as incremental housing microfinancing, developing digital financing platforms, and implementing foreclosure laws to mitigate mortgage risks, were also agreed upon.

On taxation issues, members proposed revising existing taxes, including 236 C, 236 K, Federal Excise Duty, and stamp duty. The aim is to boost the sector while ensuring affordability and inclusivity for low and middle-income groups and considering the impact on industry business activity.

The establishment of RERA under the RERA Act was recommended, with regional development authorities tasked to review master plans in major cities. Additionally, the revision of policies, rules, and regulations to incentivize vertical expansion and address barriers to private sector involvement was discussed, with suggestions for urban regeneration and the establishment of high-density zones to preserve agricultural land.

The chair appreciated the active participation of all members and recognized the housing sector as a leading sector with immense potential for economic growth.

He pledged to submit comprehensive recommendations with clear, quantifiable indicators and measures for short-, medium-, and long-term development in the housing sector.