The document summarizes the state of housing and housing finance in South Asia. It notes that over 212 million people in South Asia lack adequate housing, with many living in slums. While housing and finance markets have grown significantly, access remains limited to upper-income groups. Expanding access to middle- and lower-income families could contribute to economic and social development. However, this presents challenges due to the large poor population and lack of affordable housing options and financing terms. The document outlines opportunities and obstacles to growing housing and finance in the region.

1. Expanding Housing Finance to the Underserved in South Asia Market Review and Forward Agenda South Asia Regional Housing Finance Conference January 27-29 2010, New Delhi, India

4. Housing Debt to GDP (percent)

6. GDP growth and urbanization

10. The Glum Reality in the Slums Country Slums’ Statistics Afghanistan 80 percent of the Kabul population (2.44 million) live in slums Bangladesh 2,100 slums; more than 2 million people in Dhaka live either in slums or are without any proper shelter India 52,000 slums holding 8 million urban households, representing about 14 percent of the total urban population. Pakistan Karachi alone has between 600-800 slums, sheltering about 7.6 million (or 1 million households) out of the total city population of 15.1 million people Sri Lanka A considerable share of the population of Sri Lanka lives in plantations, slums and shanties.

12. Prevalence of Temporary Housing in South Asia Country Temporary Housing Afghanistan No data Bangladesh 50 percent of all housing India 45 percent of all housing Pakistan 39 percent of all housing Sri Lanka 20 percent of housing units have mud floors

14. Growth Rates of the South Asia Housing Finance Industry 2007-2008

16. Typical Mortgage Terms in South Asia Country Typical Mortgage Terms Afghanistan $10,000-$20,000, 12%, 20 year maturity Bangladesh $36,300-$43,600, 14-15%, 10-15 year maturity, restrictive loan-to-cost maximums (capped at 70% generally, but averaging 50% in practice). Interest rates mostly variable India $30,000 on average, 12%, 13 years maturity, plain vanilla home amortizing loans, on predominantly floating rates and with prepayment penalties, average loan to value ratio of 65% (maximum 85% at origination) Pakistan $21,000-$44,400 on average, 15-17%, 12.5 years maturity on average Sri Lanka $10,000-$40,000, 15-17%, 15-25 year maturity on average, generally fixed rates by state-owned banks and variable rates by private banks

17. Total Mortgage Balances Outstanding and Market Shares, by country Country Bank Mortgage Financing State Specialized Mortgage Financing Private Specialized Mortgage Financing Islamic Mortgage Financing Afghanistan 100% (a) 0% 0% included in (a) Bangladesh (Tk. 142.4 bn) 64% 17% 12% 7% India ( IRs. 3,970 bn) 66% (b) 4% 30% included in (b) Pakistan (Rs. 89.9 bn) 76% 13% 0% 11% Sri Lanka (Rs. 181 bn) 75% 25% 0% 0%

23. Time to Foreclose on Property in South Asia

24. Credit Bureaus in South Asia Country Typical Credit Information Collected Afghanistan None – there is no credit bureau. Bangladesh The public credit registry collects data on loans over $800, excluding MFI and utilities, retailers, and trade creditor data. The data is manual and extends only 2 years back. India The private Credit Information Bureau of India Ltd. covers over 78 million individual borrowers (10.2% of adults) and over a million firms. Data collected is both positive and negative, without a loan or other size limit, excluding MFIs, utilities, retailers, and trade creditor data. The data is computerized and goes back several years. Pakistan The public Credit Information Bureau collects data on both consumers (at most 12% of adults) and firms (up to 2 million by estimate), without a loan or other size limit, excluding MFIs, utilities, retailers, and trade creditor data. The data is computerized and goes back several years. Three private credit bureaus – Datacheck Ltd, News-VIS Credit Information Systems, and ICIL/ PakBizInfo – have recently opened, with narrower coverage than the public bureau. Sri Lanka The public Credit Information Bureau covers 80 percent of all loans by value, on individuals and companies. Data collected is both positive and negative, on performing loans over SL Rs 500,000, 3-month-overdue loans over SL Rs 100,000, and 3-month-overdue credit card balances over SL Rs 5,000, excluding MFIs, utilities, retailers, and trade creditor data. The data is computerized though manual reports are used, and goes back several years.

26. Thank you! Tatiana Nenova World Bank