Amman - Arabstoday
Around JD1.5 billion is still available at local banks to lend to the real estate sector, official data show. According to Central Bank of Jordan (CBJ) regulations, the maximum limit of credit facilities extended by licensed commercial banks to the real estate sector should not exceed 20 per cent of overall deposits in Jordanian dinar. The credit facilities to the sector include construction of property, renovation, expansion and purchase. An official at the CBJ told The Jordan Times that the loans extended to the property sector reached by the end of July JD2.2 billion or 12 per cent of the overall deposits at local banks, leaving a plenty of room for further lending. Out of nearly JD19 billion in deposits, the remaining 8 per cent stands at around JD1.5 billion. Commenting on the figures, President of the Housing Investors Society Zuhair Omari said that the availability of this cash at the banks, coupled with the eased lending policies in the local banking sector and the government exemptions that are valid till the end of the year, is likely to trigger a boom in the real estate industry in the fourth quarter. However, he said that the loans bound for the real estate sector cover “too many” activities such as commercial and tourism projects, urging the CBJ to allocate a quota for housing purposes only. “Access to credit facilities has become much easier than two or three years ago in the aftermath of the global financial crisis,” he said, adding that, however, interest rates on housing loans are still relatively high. Under government incentives, the first 150 square metres of residential apartments sized 300 sq.m. are exempted from registration fees. The year-long exemptions will expire by the end of this year.