Housing loans to individuals total JD4.17 billion in 2017 — CBJ

AMMAN — Banks’ loans granted to individuals for housing purposes in 2017 totalled JD4.17 billion, compared with JD3.92 billion in 2016, marking a growth rate of 6.4 per cent, according with the Central Bank of Jordan (CBJ).

The ratio of individual housing loans to the gross domestic product in 2017 stood at 14.7 per cent compared with 14.2 per cent in 2016, the Jordan News Agency, Petra, reported on Sunday, citing the newly issued CBJ’s 2017 Financial Stability Report.

Comparing these percentages with several countries, Jordan was the sixth least country, CBJ said, attributing this result to the fact that some 73.6 per cent of Jordanians own their residences, as well as having other loan sources, such as the Housing and Urban Development Corporation.

Commercial real estate loans granted by banks in 2017 reached JD1.118 billion, constituting 21.1 per cent of the total credit facilities to the real estate sector, increasing by 7.1 per cent from 2016, where loans stood at JD1.043 billion.

The report showed that the direct facilities granted by banks for other purposes with real estate guarantees in 2017 reached JD2.646 billion, compared with JD2.571 billion in 2016. 

The report also said that the growth of housing loans for individuals was focused in the period of 2006 to 2008, which preceded the international financial crisis that witnessed big demand on the real estate, especially by non-Jordanians.

The average growth of housing loans in this period stood at some 30 per cent, before the growth slows down  remarkably in 2009 and 2010 due to the financial crisis and banks’ hesitation to grant real estate loans.

Housing loans in the 2011-2017 resumed growth rates due to the drop in the financial crisis, better market conditions and the high demand on real estate by Arab refugees, especially Syrians.