Country Plans Housing Inventory Expansion

Affordable housingASTANA – This year, 6.9 million square metres of housing will be commissioned in Kazakhstan.

“As part of the Affordable Housing 2020 programme, developed by the President, 6.8 million square metres of housing was commissioned in 2013, which is more than last year. Low disbursement of funds has been observed in some regions,” Prime Minister Serik Akhmetov said at a Cabinet meeting.

In his report on the implementation of the housing programme, Minister of Regional Development Bolat Zhamishev noted that according to preliminary data from the statistics agency, 6.8 million square metres of housing was commissioned in 2013, which is 1.5 percent more in comparison to 2012. The oblast akimats (administrations) and akimats of Astana and Almaty allocated 27.5 billion tenge (US$177 million) of targeted transfers for construction of rental housing last year, of which 27.3 billion tenge (US$177 million) was disbursed. In reality, 402,600 square metres of rental housing was commissioned, or 140 percent of what the plan mandated.

Alongside that, 29.4 billion tenge (US$189 million) in loans was allotted from the national budget in 2013 to local executive bodies for the construction of housing sold through the system of housing savings, of which 95 percent was used. As a result, 320,000 square metres of credit housing was built, or 122.8 percent of what the plan prescribed.

As part of the project, 40.1 billion tenge (US$258 million) was allotted from the national budget to engineering infrastructure, 39.7 billion tenge (US$255.6 million) or 99 percent of it was used.

The head of the agency noted that government funds have been dispensed with greater efficiency as of late, adding that funds not used in some regions allotted for construction of rental housing and utilities will be withdrawn.

“This year, a total of 6.9 million square metres of housing will be built across the country. To complete this task and grow rental and credit housing, engineering and communications infrastructure and provide housing through the Kazakhstan Mortgage Company, 129.9 billion tenge (US$836 million) was approved for financing from the 206.2 billion tenge (US$1.33 billion) allocated to the Affordable Housing 2020 programme,” Zhamishev said.

The Minister also spoke about measures taken to reduce construction costs. The agency submitted proposals to increase the cost per square metre of affordable housing by 5-10 thousand tenge (US$32-64) depending on the class of accommodation.

“Our ministry drafted amendments to the Affordable Housing programme which increases the construction costs of 4th class housing from 80 to 90 thousand tenge (US$515 to 579), class 3 – from 90 to 100 thousand tenge (US$579 to 644); on the Construction Corporation – from 110 to 115 thousand tenge (US$708-740) for 4th class and from 120 to 125 000 (US$772-805) – for 3rd class housing,” Zhamishev added.

Amendments initiated by the ministry exclude limitations in co-financing from the local budget (currently, local governments may co-finance the construction of housing at 15 percent of its value).

In parallel, measures are being taken to reduce construction costs through the application of advanced technologies and the use of standardized designs. As part of the development of industrial housing-building, 17 projects on the construction of house-building factories with a total design capacity of approximately 1.5 million square metres per year will be implemented in the country.

First Vice Minister of Industry and New Technologies Albert Rau, regional akims (governors) from Mangistau – Alik Aidarbayev, North Kazakhstan – Samat Yeskendirov, and Zhambyl – Karim Kokrekbayev, chairman of the board of the Kazakhstan Housing Construction Corporation Ruslan Khussainov, chairman of the board of Zhilstroysberbank Aybatyr Zhumagulov, and Samruk-Kazyna Real Estate Fund Representative Bolat Palymbetov made presentations at the meeting.

Summing up the meeting, the prime minister mentioned the Affordable Housing 2020 programme’s good progress. However, according to Akhmetov, it is necessary to solve all systemic problems and to ensure strict implementation of the President’s instructions on housing construction by increasing the amount of housing to 10 million square metres in 2020.

“The implementation of this programme will provide a multiplier effect for other sectors of the economy, particularly the construction industry,” Akhmetov said.

Last year, seven modern house building factories were launched, this year 8 such plants will be put into operation. It is important to keep these factories supplied. That’s why regional governors, together with the Ministry of Regional Development, were instructed to ensure that the factories have 2-3 years of supplies.

The prime minister tasked oblast akimats with providing an unlimited amount of housing this year and taking measures to ensure the disbursement of funds allocated for this purpose.

The Ministry of Regional Development, oblast governors and the mayors of Astana and Almaty were instructed to ensure strict control over the implementation of the programme in the current year, as well as to conclude programme memoranda for 2014.

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