Madagascar: Banks tighten mortgage standards
In the difficult economic climate, banking institutions have introduced several measures to limit their mortgage related risks.In the difficult economic climate, banking institutions have introduced several measures to limit their mortgage related risks.
During a housing conference in Madagascar, one bank based in Antanarivo announced it is offering credit under the condition the beneficiary accepts a partnership concluded between the financial firm and a building company agreed by the bank, L'Express de Madagascar reports.
"The future owner must accept the partnership between the bank and the building company. Otherwise, we will only offer a loan without preferential rate," said a manager at the enterprise.
Furthermore, banks now only distribute money according to the progression of the building work and only consumers with a minimum salary of 500,000 ariary (€172) can benefit from a housing loan.
The Malagasy real estate market is struggling to recover from the effects of the global financial crisis and although the housing on offer significantly increased recently, demand remains low, L'Express reports.
A decrease in the rental demand was also witnessed. "Owners need cash. Rents have decreased by 20 to 30 percent," said a manager at the estate agent Leximm in Antananarivo.