CAIRO: Establishing a solid mortgage finance market is vital to maintaining the success of the real estate sector, experts said Monday at the Euromoney real estate conference. With 22 banks and companies handling mortgage insurance in Egypt, "mortgage insurance is in place, said Fathy El Sebai, chairman of the Housing and Development Bank, in a session entitled "International Partners in Egypt's Housing: An Overview of the Opportunities and the Bottlenecks in Egypt. The session was one of discussions during the Euromoney Egypt Housing and Real Estate Finance Conference. "Although 22 entities might not be as big as our hopes or intentions, with the right regulations and laws it will increase, he said. Despite the low number of institutions in place, the mortgage finance sector is solid and is not expecting a collapse like its American counterpart, he added. With the visible growth in this sector, some companies have introduced new services to the market. For example, i-Score offers a comprehensive database to inform lenders and buyers of their mortgage finance options. "With an increase from LE 16 million to LE 2.2 billion in mortgage finance funds, the growth potential is huge and lucrative, said Mohamed Refaat, managing director of i-Score. With more data, the customer will be better informed and "no one will own the customer, Refaat said. There are similarities between Egypt's mortgage finance experience and Mexico's. In Mexico, government agencies work as a catalyst to boost mortgage finance operations in the country, said Alan Elizondo, vice president of Comision Nacional Bancaria y de Valores. In Hong Kong, on the other hand, the country is working on a way to develop the product itself. "We are working on a way to provide guarantees rather than insurance, it is the same in substance, said Angela Leung, vice president of marketing and business development of Hong Kong Mortgage Corporation Ltd. Speaking about the Jordanian experience, William Patry, resident technical adviser of the Jordan Housing Loan Insurance Project, said that Egypt has addressed many of the obstacles Jordan is currently facing. However, he called for working on "the implementation of a mortgage insurance education program for borrowers. Mortgage finance has not neglected the low income bracket, El Sebai said. A program that will provide 500,000 units in six years, effective 2005-2011 is in the works. "This program is subsidized by the government, providing free land and LE 15,000 for each unit to subsidize the buyer's construction process, he said. With the increase in the price of construction raw materials, the program has raised the monetary subsidy to LE 25,000. Around 45,000 units are also offered on a rent basis with a subsidized rent program. "With all these facilities, people are becoming more interested to join the mortgage finance market, El Sebai said.
