Iraq's central bank lifts housing purchase funding to 3 trillion dinars

Summary

• The Central Bank of Iraq raised housing unit purchase allocations to 3 trillion dinars.
• The increase adds 1 trillion dinars to the previous allocation, disbursed through the Real Estate Bank.
• More lending capacity means more citizens can finance units inside residential complexes.

The latest

Funding for housing unit purchases in Iraq has been raised to 3 trillion dinars, an increase of 1 trillion dinars over the previous allocation, the Central Bank of Iraq announced. The money is to be disbursed through the Real Estate Bank. The bank said the decision rests on its role in supporting the housing sector and on demand from citizens seeking to buy units inside residential complexes, according to the Iraqi News Agency.

Details

• The figure: The new ceiling stands at 3 trillion Iraqi dinars for the purchase of housing units, up from 2 trillion dinars under the previous allocation, according to the Iraqi News Agency. The added 1 trillion dinars represents a 50% expansion of the envelope available to borrowers.
• The channel: The funds are to be disbursed exclusively through the Real Estate Bank, the state lender responsible for housing finance in Iraq. The Central Bank did not name any other institution as a disbursement channel for the expanded allocation.
• Legal basis: The decision was issued under Real Estate Bank Law No. 56 of 2004, as amended, the Central Bank said. It also cited a letter dated 22/8/2024 registered under number H S/4451/6/11, paragraph A, as the reference for the increase.
• The stated purpose: The Central Bank said in its document that the increase stems from its role in supporting the housing sector, and is intended to meet the requests of citizens wishing to purchase housing units inside residential complexes, according to the Iraqi News Agency.
• The target units: The allocation is directed specifically at units located within residential complexes rather than individual housing stock, according to the Central Bank's stated purpose. The bank did not specify which complexes or governorates would be covered by the expanded funding.
• The procedural step: The Central Bank asked the director general of the Real Estate Bank to attend its headquarters on Rashid Street in Baghdad to sign an amendment to the contract governing the allocation. No date for the signing was disclosed.
• What was not set out: The Central Bank did not publish loan terms for the expanded allocation, including interest rates, repayment periods, maximum per-borrower amounts, or eligibility criteria. It also did not state when disbursement under the higher ceiling would begin.

Background

The Real Estate Bank is Iraq's state-owned housing lender, operating under Law No. 56 of 2004 as amended. Central Bank allocations channelled through it finance purchases of residential units, with the government the main source of large-scale housing supply.

Between the lines

The decision addresses financing capacity rather than supply: the extra 1 trillion dinars expands what buyers can borrow, but the allocation is tied to units inside residential complexes, meaning its reach depends on how many such units are available. With terms, rates and eligibility still unpublished, how far the increase translates into completed purchases remains open.

What's next

Watch for the signing of the contract amendment at the Central Bank's Rashid Street headquarters, and for the Real Estate Bank to publish lending terms, per-borrower ceilings and eligibility rules under the higher allocation.

Source: Iraqi News Agency (INA)