HYPOTHEC: WILL IT REALLY ABOLISH THE ACUTENESS OF FLAT PROBLEM?

Azat Artsakh Daily
21 Aug 08
Republic of Nagorno Karabakh [NKR]

An interview of "Azat Artsakh" with the executive director of the
Investment Fund of Artsakh Karen Essayan As it’s known, flat problem
in Nagorno-Karabakh has been always urgent, but for objective reasons
it has received special acuteness after azrbaijan-karabakhian war.

It’s known also, that together with other problems, assistance of
solution of this vital problem enters in the functions of investment
fund headed by you… – Really, flat problem has been always the
most difficult solved problem all the time in the range of social
problems of Nagorno-Karabakh. Because of unleashed war of Azerbaijan,
in the result of which a great part of flats has suffered, as well
as because of restoring flat construction those years, then passing
on to market relations in all the spheres of economy, solution
of flat problem for the majority of the NKR population has become
vain dream. Though it’s important to note, that just after the war,
the republic took up restoration of ruined cities and villages. The
state by means of realization of a number of purposeful programs,
particularly directed to the construction of new flats, has solved to
the extent of possibilities and solves the problem of improvement of
flat conditions of sepa rate groups of the population: families of
killed azatamartiks and invalids of Karabakh war, families of many
children and socially unprovided.

Unfortunately, a great part of the population, till today, hasn’t
an own roof. Especially young families first of all appear in grave
situation, who are forced either to live with parents or to rent a
house. From this viewpoint rural settlements are not excluded, where
48.6 per cent of NKR population lives. For the purpose of softening
certainly the acuteness of the above-mentioned problems, improving
flat conditions of the population, spuring flat construction in
the republic, NKR government, by the decision of February 26, 2008,
has defined an order of rendering assistance for acquiring flats and
dwellings by means of bank hypothetic crediting.

Corresponding to that decision, realization of this program is placed
on the investment fund of Artsakh. – It’s necessary to confess,
that the hypothec is a new conception for Nagorno-Karabakh. Interprete
please, the essence of hypothec crediting, which is observed by the
management of the republic as one of the most effective means of
solution of flat problem.

– Even in developed industrial countries solution of flat problem
doesn’t take an elemental turn, but, we may say it is under the state’s
control. In these countries solvent citizens can acquire flats, and
hence, the main part of population=2 0makes use of hypothec credits
and the state assists actively crediting.

Hypothec is a pledge of real estate, mainly land or buildings,
for the purpose of getting loan. Hypothec is a type of pledge, in
case of which loaned property is not inherited to a creditor, but
remains at a borrower’s disposal. – When the state decided to put
the program of hypothec crediting in action, a task was set by the
President of the republic to make the hypothec accessible for wide
layers of the population.

In what way this problem is solved ? – It’s necessary to note,
that a program of state assistance on hypothec crediting is realized
first time in NKR. Let’s remind, that yearly rate of pays of hypothec
credits allocated by commercial banks hesitates within the limits of
12-16 per cent.

So, the program realized by us, lets make credits accessible for the
population. Within the scopes of this program the state uses different
forms of financial mediation. The first, it’s a partial subsidizing of
rate of pays of credits, in case of which the state subsidizes half
of yearly 12 per cent pay allocated by banks, the rest 6 per cent
a citizen pays at the expense of his own means. The second, it’s an
allotment of purposeful unpercentage loan for paying initial deposit,
the size of which compiles the difference between the percentage of
determined initial deposit and 10-p ercentage pay, paid at the expense
of a citizen’s own means. And, at last, the third: it’s a construction
of a flat by menas of hypothec crediting.Let’s note also, that state
assistance on hypothec crediting includes the following directions:
purchase of a flat or a dwelling, restoration of a flat or a dwelling.
– Is an activity noticed in flat market after the beginning of the
program’s realization? Do the people apply to the investment fund for
assistance in the work of getting hypothec credits? – From March 21,
2008 till August 15, 2008, 519 citizens have applied to the investment
fund of Artsakh. 208 or 40.08 per cent of them have expressed wish
to buy a flat or a house, 79 or 15 per cent – to build a house,
232 or 44,7 per cent – to repair the flat or house. 182 citizens of
those, who have tendered to acquire a flat, wish to buy a flat in the
first zone (Stepanakert), 26 – in the second zone (NKR regions), 63
citizens want to build a house in the first zone, 16 – in the second
zone, 187 citizens want to repair the flats in the first zone, 45 –
in the second zone. After registration of experimental deduction,
the represented claims of the citizens are discussed at the sessions
of the fund’s financial committee, where a final resolution is passed
about rendering state financial assistance to this o r that citizen
or about rejecting it.