The State Bank of Pakistan (SBP) officially relaxed key prudential requirements for housing finance today, April 29, 2026. This major update falls directly under the government’s “Wazir-e-Azam’s Apna Ghar Program – Ghar Ho Tu Apna” initiative. Consequently, the central bank aims to accelerate mortgage approvals and broaden access to affordable home ownership across the country.
The SBP’s SME, Housing and Sustainable Finance Department issued a circular detailing these changes. Specifically, the regulator eased conditions for commercial banks and the House Building Finance Company Limited (HBFCL) to improve the program’s overall implementation.
Apna Ghar Program Expanding Loan Eligibility
To begin with, the SBP increased the debt burden ratio. Now, total monthly repayment obligations can reach up to 65% of a borrower’s net disposable income. Importantly, this limit includes both the new housing loan and any existing consumer debt. Therefore, this significant adjustment dramatically expands eligibility for potential applicants.
Furthermore, the central bank relaxed property assessment requirements to simplify the valuation process. For properties valued up to Rs. 5 million, banks and the HBFCL can now rely entirely on their own internal valuation mechanisms. Meanwhile, higher-value properties require a different approach. For homes exceeding the Rs. 5 million mark, evaluators from the Pakistan Banks’ Association (PBA)-approved panel must conduct at least one formal valuation.
Faster Approvals & Regulatory Updates
In addition to valuation changes, the SBP directly tackled processing delays. The central bank strictly mandated that lending institutions must complete credit approvals within 15 working days. However, applicants must submit a fully documented application to trigger this rapid timeline.
Finally, the SBP explicitly relaxed prudential regulations HF-3 and HF-7 to facilitate these specific measures. Accordingly, the regulator directed banks and the HBFCL to ensure strict compliance with these updated instructions. Ultimately, these latest measures form part of broader efforts to revive housing finance activity and improve affordability in a market experiencing rising urban demand yet relatively low mortgage penetration.
