Government Rolls Out First-Ever 20-Year Home Loan Scheme

In a major step toward making homeownership more accessible, Finance Minister Muhammad Aurangzeb has introduced a 20-year mortgage financing scheme aimed at supporting first-time buyers. Announcing the initiative in the National Assembly, he highlighted the government’s broader commitment to housing development and financial inclusion.

The long-term loan scheme will enable middle-income citizens to purchase residential properties with extended repayment options, reducing the financial burden of homeownership. The new legislation also exempts transactions involving properties valued up to Rs. 50 million, plots up to Rs. 100 million, and vehicles up to Rs. 7 million from the scope of certain tax regulations.

The government has revised the withholding tax structure as well. Currently, properties purchased before July 1, 2024, are subject to a tax rate between 4.5% and 6%. However, properties held for more than 15 years will now be exempt from withholding tax, promoting long-term ownership and reducing tax liabilities for homeowners.

Empowering women through financial access remains a key focus. So far, 193,000 women have secured loans under various government-backed schemes, and an additional Rs. 14 billion has been earmarked to support more women borrowers in the upcoming phase.

To further ease the path to homeownership, tax credit incentives have been introduced for individuals purchasing flats or constructing houses. Buyers of apartments up to 2,500 square feet will be eligible for tax credits, while mortgage holders can now claim up to 30% tax credit on interest paid.

These reforms reflect the government’s commitment to boosting the housing sector, encouraging long-term investment, and making property ownership a realistic goal for more Pakistani families.