According to the president, housing through the State Mortgage Company remains more affordable than on the free market.
At a meeting of the Jogorku Kenesh, Sadyr Japarov responded to criticism from deputies regarding the prices of housing offered by the State Mortgage Company.
He emphasized that it is impossible to sell apartments at cost price, even if the land is provided free of charge. According to the president, the mortgage company must operate as a stable and long-term structure.
“If housing is provided without a surcharge, we will have to allocate funds from the budget every year. As a result, in 10-15 years, the company may go bankrupt and stop construction,” Japarov noted.
The president also reported that the authorized capital of the State Mortgage Company amounted to 2 billion dollars. This year, 400 million dollars from the net profit of the National Bank are directed to the development of the program, of which 200 million will go to the south of the country, while the rest will go to the north to complete current and start new construction projects.
He added that about 4% of the budget goes to administrative expenses.
An additional surcharge of 250-300 dollars per square meter was introduced to partially cover inflation over the past 25 years. However, despite this, the cost of housing under this program remains significantly lower than the market price.
“Private developers offer apartments for 2-3 thousand dollars per square meter in a state ready for PCO, while we order construction 'turnkey',” he said.
The state has set fixed prices for construction companies: 750 dollars per square meter in the regions (including about 50 dollars for transporting materials) and 700 dollars per square meter in Bishkek.
Construction companies build houses and transfer them to the State Mortgage Company, which sells housing to the population at a price ranging from 950 to 1000 dollars per square meter with an installment plan for 25 years.
Responding to rumors that only one person, Kanibek Tumanbaev, is involved in construction, the president stated: “If any of you have a construction company, come. I will provide the land. If you can build at this price, build.”
He also noted that at the beginning of the program, the authorities offered all construction companies to build housing in Bishkek at a price of 700 dollars per square meter 'turnkey', but most developers rejected this offer.
“They laughed and claimed that it was impossible to build 'turnkey' for 700 dollars, demanding at least 900-1000 dollars. Therefore, we had to develop the system ourselves and attract those companies that agreed to work at the established price,” concluded President Japarov.
