A recent presidential decree has increased the charter capital of the Azerbaijan Mortgage and Credit Guarantee Fund (AMCGF) by 85 million manats from the state budget, aimed at expanding long-term mortgage, social lending, and lease-to-own housing programs.
This follows an earlier capital increase of 87 million manats in October 2024, bringing the fund’s total capital to 1.153 billion manats. According to MP and economist Vugar Bayramov, regular budget injections are significantly widening access to affordable housing:
“Since its creation, the fund has issued 51,778 mortgage loans worth over 3.249 billion manats. Annual capital increases have become systematic, enabling more citizens to purchase homes on preferential terms,” he noted.
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Social Focus
Fund mortgages are targeted at priority groups: young families, civil servants, teachers, scientists, journalists, military personnel, and families of martyrs, among others. Loans are offered at 4% and 8% annual interest, for 3–25 years, with maximum amounts of 100,000–150,000 manats and down payments starting at 15–25%. However, affiliated banks often require 20–30% due to risk assessments, as Vesti.Az reports.
Market Impact and Challenges
Realtors say demand remains strong as rising property prices make buying without a mortgage nearly impossible. Association of Realtors head Elnur Azadov warns that long-term saving strategies have lost relevance, and lease-to-own schemes see low demand due to limited supply of small, affordable units.
Lawyer and finance expert Akram Hasanov notes that not all of the fund’s capital is used directly for lending — part covers operational costs. Lending limits for partner banks depend on their stability and asset quality. He also stresses that borrowers must cover part of the purchase cost to ensure repayment capacity.
Statistics and Outlook
In 2025, AMCGF mortgage issuance grew by 1.1% to over 230 million manats, including 67 million manats in concessional loans. Budget allocations totaled 42.5 million manats, slightly down from last year. Private bank mortgages remain stagnant due to tighter lending conditions.
MPs and market analysts advocate raising the preferential mortgage cap to 150,000 manats to keep pace with rising real estate prices. Bayramov supports the increase, while Hasanov cautions that loan size must be balanced with risk management.
