For the sake of bourgeoisie

A prole just doesn't want to get involved in the games with the State that can rob him. Bureaucrats explain it by the fact that our people's mentality is different, that it doesn't want to live off credit. It can still change its mind, mature and eventually start to use the services of the banks that are ready to render those services at any moment.

For the first time in Kazakhstan within the government program a closed joint stock company "Kazakhstani Mortgage Company" (KMC) - an affiliate structure of the National Bank, together with "Bank CentreCredit" OJSC and other partner banks offer mortgage loans to the population for the purchase and maintenance of housing in KZT for the term of from 3 to 10 years.

They say in the capitals that this program has been successfully approved, the people rushed in for loans. During the project realisation Kazakhstani Mortgage Company has bought more than 230 rights of demands on mortgage housing loans for the amount of around 300 million tenge. The average amount of the loan is 1 million tenge (equalling around 7 thousand USD). The share of families with the average income $200-$300 made around 85% of the total numbers of borrowers. Borrowers independently, in compliance with their incomes and requirements, select housing for purchase. But it's in the capital, where the average income is always higher, than in province. 300 USD for such town as Uralsk is not an average income, but quite high. Only those who work in the oil & gas area receive such salary. Anyway, these people, as a rule, seek to avoid the State and not to deal with the banks. The rest of population that is public sector workers and people with a very low income from 5 to 15 thousand tenge are very suspicious of such phenomenon as mortgage lending indeed. And the fact that "Kazakhstani Mortgage Company" CJSC decided to get CentreCredit Bank involved into its activities, brought even more distrust among such people. Not because this bank is bad, not at all, it's just that once trapped by this bank, these people understood that they had been captured for good.

It would seem like, all started from good intentions of the same government, which in the beginning of the 90-s wished to help national intelligentsia to purchase housing at the expense of the State lending. Zhilstroibank was created especially for that. Teachers and doctors, who worked for more than one decade and, all this time together with their families, lived in dormitories or rented apartments, were very grateful indeed to the Motherland for this care. But this care turned into real chains. Having received a loan for 30 years, around 2 thousand representatives of Kazakhstani intelligentsia bought themselves housing. The loan must be tied to the US dollar, oscillating up and down. And this brought to the fact that no matter how much funds the lenders would pay for the loan, anyway it turned out that tomorrow they would owe more than today. And as it often happens here Zhilstroibank one day just disappeared, and CentreCredit Bank became its legal heir, which still wants to get Zhilstroibank loan from the people.

The KMC management now from its height observes that the experience of early reforms showed one of the main problems, impeding the extension of crediting to the population - the praxis of tying the loan to the foreign currency rate. It increases the creditors costs significantly. Besides, crediting in foreign currency brings to the dependence on external factors, that is to a virtual dollarisation of the economy.

The problem in many respects is in the fact that the practice of investing money into mortgage lending by the financial market participants is not very widespread here, although such mechanism helps to decrease the fee rates on loans.

In all the civilised world attaining desired goods at the expense of future incomes - is normal. But only under condition that the people trust the State and other juridical persons dealing with crediting, while the latter - never fail to fulfill people's hopes, but on the contrary, do all possible to achieve it.

Up until recently a tendency remains to direct mortgage offer in the Republic towards a well-off consumer. An elite segment is credited, apartments in new expensive houses. But here you shouldn't miss. The capital company "Astana-finance" exactly on mortgage lending in the last year undertook to complete a 174 apartment house on the outskirts of Uralsk, the construction of which had been frozen for almost ten years. The company completed the house in brief term and it was well-done. Eventually, each square meter of the area was estimated in 450 USD. But nobody wishing to buy housing on such price on the outskirts of Uralsk was found. There are not enough rich people, who could afford such an apartment. The local establishment, as soon as it gets some money, builds cottages in the centre of the town, buying all worn out houses for demolition. As for the above mentioned house, it would remain without owners for God knows how long, if it weren't lucky. Karachaganak Integrated Organisation decided to buy the whole house to move all residents of Tungush village, that is located in the direct vicinity to the field, there.

Maiko Sagindykova, chairman of the board of KMC, in her interview to journalists notes that "the market of elite houses crediting is limited, because only a few can buy such houses. Besides, this type of crediting has got a high degree of risk: the size of borrowers liabilities is great. Another factor of risk - is a high degree of possibility of an abrupt fall of the cost of housing due to the limited demand. Apparently, in the nearest future the prospects of growth will have operations on crediting of the average quality housing on the secondary market. Considered that the resources are attracted mainly in foreign currency and for the terms, not exceeding 3 years, the possibilities of long term crediting for the population in the national currency are very limited. Therefore, although there is vast supply, the population is unwilling to apply for mortgage lending: people are scared of the national currency devaluation, because the majority of citizens receive their incomes in tenge. Besides, small terms of crediting suggest a necessity of significant monthly credit repayment, which is reflected on the personal budget and level of life immediately".

By the way, in relation with this the actions of Konstantin Titov, the governor of Samara oblast, who introduced for the first time in Russia mortgage lending for young families, when after the birth of each child the State writes off a part of the debt, and eventually can write off up to 60% of the loan, can serve as a good example. Our bosses will never have such an enlightenment.

And they are not in a hurry to provide lending in tenge that would not be tied to the US dollar, because the risk for the bank is too big. It's just that a few persons think about the real borrower. KMC is supposed to devlop a program in mortgage lending, provided in tenge, but really will it work and when? And while in the rest of the world the mortgage lending is directed mainly towards a resolution of the housing problems of simple folks in Kazakhstan it serves a hndful of bourgeois. Although the State, having developed a scheme of available mortgage lending would be able to resolve many problems related with housing, and to prevent social tension that can emerge.