Housing or Shelter is a basic human need as enshrined in the constitution of the Republic of Uganda in the Social and Economic objectives XIV (b).
Government has a constitutional responsibility of providing infrastructure like transport, schools, hospitals, clean and safe water, electricity and shelter for its citizens. Government has been able to provide all the other infrastructure apart from housing or shelter. Previously the government used to provide housing for its citizens but with the coming of liberalizing and privatisation all houses that it owned were sold and others given away.
Infrastructure being a massive investment cannot be done by individuals as we are currently carrying the housing load a responsibility government has left to its citizens. When the government found that Ugandans loved to build houses it excused itself of its responsibility and now the citizens are paying a high price to meet their other needs. The citizens wouldn't mind if the government provided affordable mortgage facilities to finance housing development since they are trying to carry out government responsibility.
Infrastructure being a massive investment cannot be done by individuals as we are currently carrying the housing load a responsibility government has left to its citizens. When the government found that Ugandans loved to build houses it excused itself of its responsibility and now the citizens are paying a high price to meet their other needs. The citizens wouldn't mind if the government provided affordable mortgage facilities to finance housing development since they are trying to carry out government responsibility.
HOUSING FINANCING
Housing financing like other infrastructure financing is managed by long term low-interest funds. In Uganda, we are using commercial banks to finance housing with high-interest rates and yet return on investment in housing never exceeds 4% per annum. So if you got a mortgage from a commercial bank it is impossible to pay the mortgage from the proceeds of the house.The government always borrows money to develop infrastructure from development partners at about 0.4% per annum for a period of about 50years. It comfortably repays the loan and we also enjoy the facility. The government can borrow money to develop the housing sector and lend it to commercial banks at say 2% and the banks can get us mortgages at 4%. The citizens will then use their savings to pay the mortgage and the balance for the improvement of their livelihoods. This will keep money in circulation and the economy will grow since the money used for the housing is cheap.
CONCLUSION
The housing development is one sector that can stimulate the economy given that its massive with a lot of direct and indirect beneficiaries. The building materials manufacturers, stockists and contractors are some of the direct beneficiaries and also they create jobs and pay government taxes. The loan repayment is by the homeowner's mortgage repayment and so the other citizens not in need of houses are not affected.
The housing development is one sector that can stimulate the economy given that its massive with a lot of direct and indirect beneficiaries. The building materials manufacturers, stockists and contractors are some of the direct beneficiaries and also they create jobs and pay government taxes. The loan repayment is by the homeowner's mortgage repayment and so the other citizens not in need of houses are not affected.
No comments:
Post a Comment