Housing facility

THE Reserve Bank of Fiji has approved 142 first home applications so far in addition to the 635 that benefited initially from the facility through Housing Authority.

Reserve Bank of Fiji governor Ariff Ali yesterday made the statement in response to questions from the Standing Committee on Economic Affairs on its 2016-2017 Report.

Mr Ali was asked for an update on the $60 million housing facility for low income households.

The RBF governor told the committee that the $25m facility was increased to $60m to assist first home buyers and the coverage was broadened to include commercial banks, licensed credit institutions and the Fiji Development Bank.

Mr Ali said the maximum interest rate charged to home buyers was 5 per cent and financial institutions that borrowed from RBF for the facility were charged 1 per cent.

“Therefore a total of $22.8m remain available for lending to first home buyers and we expect this to be utilised in the next 12-18 months,” he said.

Committee member Alvick Maharaj asked: “For this housing facility who actually sets the criteria, is it set by financial institutions or by RBF, who monitors it and is there a maximum interest rate that’s charged for first home buyers.”

The RBF governor said the guidelines were set by the Reserve Bank.

“The guideline states that the maximum interest is 5 per cent because the term has been set for five years.

“Other guidelines for first home buyers, when the facility was with Housing Authority, it was only for those with incomes below $30,000.

“We’ve now increased it to $50,000 simply because house prices have gone up,” Mr Ali said.

The Standing Committee for Economic Affairs was chaired by Government MP Lorna Eden with sitting members Mr Maharaj and Viliame Gavoka with the RBF team consisting of governor Mr Ali, chief economist Caroline Waqabaca and Lorraine Seeto, chief manager Governor’s office.

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