Funds of the population for housing construction will be guaranteed

Today, the population of Uzbekistan has exceeded 37 million people. This year alone, 215 thousand new families were created, significantly increasing the housing demand.

This year, multi-storey buildings with 100 thousand apartments will be commissioned. The construction of buildings with 120 thousand apartments is planned for next year.

At the same time, against the background of increased demand, unscrupulous entrepreneurial activity has appeared in this area. The lack of an orderly payment system, digitalization, and transparency creates favorable conditions for abuse. Many citizens transfer funds for new housing directly to developers, bypassing banks, which contributes to the growth of the shadow sector. The deadlines for housing delivery are often delayed, and the contributed funds are frozen. Equity participation agreements are usually not officially registered and are drawn up to serve the interests of unscrupulous developers.

In this regard, at a meeting on September 23, the President instructed to develop a system that would guarantee the protection of people’s funds when purchasing housing. The corresponding proposals were considered at the presentation.

As noted, the escrow system has proven itself in foreign experience. According to this model, an escrow account will be opened in a commercial bank for each construction project based on an agreement between the customer and the bank. Payments for real estate will be made through this account. Commercial banks can provide loans to the customer at a reduced rate from the funds accumulated in the account. After the completion of construction, the funds from the buyer’s escrow account are transferred to the development organization’s account. If the developer fails to fulfill its obligations, these funds are returned to the owner. The funds in the escrow account cannot be subject to collection.

The President approved the proposals and gave instructions to develop a legal framework for the system and integrate it into the ministries and agencies related to the construction sector.