-President Ali announces, says government wants to be citizens’ building partner

FIRST-TIME homeowners will now be able to deduct the full amount of interest paid on mortgages of up to $30 million from their taxable income, President Dr Irfaan Ali announced on Thursday night as he officially declared open this year’s International Building Expo.

The Head of State, addressing hundreds at the Providence National Stadium, described the policy move as the government “sharing the cost” of home ownership with Guyanese families.

“The government has doubled the ceiling and mortgage interest tax relief for first-time homeowners under Section 28 of the Income Tax Act,” he said adding:

“If you’re a first-time homeowner living in your own property, you can now deduct from your taxable income the full interest you pay on mortgage principle up to $30 million.”

He explained that this is a direct partnership between the State and households in financing their homes.

“What does this mean in practice? It means the government is sharing the cost of your mortgage with you. That is what it means in practice, that the government is sharing the cost of your mortgage with you,” the President said.

The President linked the tax relief to aggressive reforms in the mortgage and housing finance market since the People’s Progressive Party/Civic (PPP/C) returned to office in 2020.

He noted that when the government took office, the New Building Society (NBS) mortgage ceiling stood at $8 million. That has since been increased almost fourfold.

“We’re not just giving you access to loans; we are making the government your partner in building your home.”

Dr Ali said the wider banking sector has followed suit, with commercial banks slashing mortgage rates and expanding access to larger loans, signalling strong confidence in the economy.

“The power of competitive financial system is when a government moves, the market follows and has moved with extraordinary speed,” he underscored.

Republic Bank has scrapped its residential mortgage ceiling altogether and is now offering loans of up to $60 million at 5 per cent, with rates starting as low as 3.5 per cent, alongside a ‘mortgage move’ product that allows borrowers to transfer from higher-cost loans at other institutions.

Guyana Bank for Trade and Industry Limited (GBTI) has restructured its entire mortgage portfolio with standard rates beginning at three per cent from 1 May, further reduced for loyal customers.

Citizens Bank has introduced a new mortgage regime with rates from 3.5 per cent over a 35-year term, 100 per cent construction financing, no requirement for a 25 per cent upfront contribution, and zero commitment or processing fees.

According to the President, similar reductions have been rolled out by Demerara Bank and Scotiabank, resulting in mortgage rates that had ranged between eight and 15 per cent just five years ago being driven down sharply across the system.

The President stressed that the government views home ownership as central to social stability and nation-building, not merely as an economic transaction.

“We are doing this because we view home ownership as not just an economic transaction, but as a statement of belonging. When a family in Guyana owns their home, when their name is on that title, deed, or transport, when their children grow up with a backyard and a bedroom of their own, when they are building equity rather than paying rent, something changes, security changes, aspiration changes, the relationship between citizens and nation changes,” he said.

Dr Ali reported that since 2020 the housing sector has experienced an “extraordinary” surge in demand, which he attributed to public confidence in the Government’s ability to deliver serviced house lots and homes.

He recalled that when the PPP/C demitted office in 2015 there were more than 20,000 house lots in the pipeline and 39,000 applicants in the system. By 2020, he said, confidence had dipped and the new administration inherited a backlog of around 22,000 applications.

Since then, the number of applications has grown sharply.

“What took place between 2020 and now is nothing short of extraordinary, because of the confidence of people in knowing that they will get the house lots, the confidence of people in knowing that there is a government that is prioritising housing, that is investing in housing, and that is delivering in housing,” he said adding:

“The applications in that period grew by 60,000. That is not accidental. That is because of the confidence in the system, and everybody wanting to be part of the growth story, owning their own homes, and that is where we are today.”

The President reported that there are now some 81,000 applications in the housing system, the overwhelming majority of which are new.

According to him, the previous backlog has been effectively cleared, with 67,000 of the current applications originating from 2020 onwards. He noted that the average age of these new applicants is just over 23, underscoring the growing confidence of young people in accessing home ownership.