The Government of Pakistan has launched the Mera Ghar Mera Ashiana housing scheme, a flagship initiative designed to make homeownership a reality for first-time buyers. By offering subsidized housing finance, the scheme aims to reduce the financial burden on citizens. It specifically targets those who do not currently own a home, helping families purchase, build, or expand their living spaces.
Mera Ghar Mera Ashiana Scheme – Key Features
| Category | Details |
|---|---|
| Eligibility | Pakistani citizens who do not already own a house |
| Housing Units Covered | Houses up to 5 marlas; Flats up to 1,360 sq. ft. |
| Loan Providers | Commercial banks, Islamic banks, microfinance banks, House Building Finance Corporation |
| Maximum Loan Amount | Up to PKR 3.5 million |
| Loan Tenor | Maximum 20 years |
| Tier 1 Loan | Up to PKR 2 million at 5% fixed markup |
| Tier 2 Loan | Above PKR 2 million to PKR 3.5 million at 8% fixed markup |
| Government Subsidy | Markup subsidized for the first 10 years |
| Charges | No processing fees or prepayment penalties |
| Risk Coverage | 10% coverage of the outstanding portfolio by the government |
| Implementation | Banks are instructed to gear up their systems for smooth operation and to prevent misuse |
Eligibility and Coverage of Housing Units
According to the State Bank’s circular, the program is open exclusively to Pakistani citizens who have never owned a home before. The coverage includes a variety of housing options such as newly purchased flats, constructed houses, construction on owned plots, or combined purchase-and-construction projects. Eligible units include houses up to five marlas in size or apartments measuring up to 1,360 square feet.
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Loan Structure and Affordable Financing
The scheme provides financing options through commercial banks, Islamic banks, microfinance banks, and the House Building Finance Corporation. Loan amounts are capped at PKR 3.5 million with flexible tenors of up to 20 years. To ensure affordability, the government will subsidize markup rates for the first ten years. This measure will significantly lower the monthly installments, especially for low and middle-income families.
Fixed Rates for Tiered Loans
Under the financing structure, customers benefit from fixed interest rates, ensuring predictability in repayment. For Tier 1 loans of up to PKR 2 million, borrowers will pay only 5% markup. For Tier 2 loans ranging from PKR 2 million to PKR 3.5 million, the markup is fixed at 8%. Additionally, banks will not charge processing fees or prepayment penalties, making early repayments easier and cost-free for beneficiaries.
Risk Coverage and Banking Preparedness
To reduce financial risks, the government has introduced a first-loss coverage mechanism. This ensures that up to 10% of the outstanding loan portfolio is secured by the state, encouraging banks to extend credit with confidence. Moreover, all participating financial institutions have been directed to update systems and processes, ensuring smooth loan disbursement while preventing misuse or delays in implementation.
Boosting Financial Inclusion and Urban Growth
The Mera Ghar Mera Ashiana scheme represents more than just a housing program—it is a step toward financial inclusion and sustainable urban development. By empowering citizens to own homes, the initiative strengthens family stability and contributes to long-term economic growth. It will not only bridge the housing gap but also stimulate construction-related industries, thereby creating jobs and supporting Pakistan’s development vision.
