Challenges and Prospects of Housing Finance Sector: A Comprehensive Study in the Context of Bangladesh

The housing finance sector of Bangladesh stands at a promising stage. This study tries to provide an inclusive analysis regarding the challenges and prospects of the housing finance sector of Bangladesh, aiming to provide some valuable insights for policymakers, financial institutions, and stakeholders. Objectives of the study are to understand the growth prospects of housing financing sector and analyze the key challenges of the housing finance sector in Bangladesh. This study is primarily based on secondary data, sourced from various pertinent sources. Furthermore, the analysis of these secondary data enhanced the primary findings, contributing to a comprehensive understanding of Bangladesh's housing finance landscape. The contribution of housing finance sector to the economic development is multifaceted. The sector directly and indirectly contributes to the Gross Domestic Product (GDP) through the creation of employment, generation of government revenue, development of infrastructure along with having some multiplier effects on other industries. Factors such as maturity mismatch of fund, limited access to finance, income disparities, high interest rate, lack of proper collateral are identified as key challenges for the housing finance sector. Innovative finance mechanisms, such as mortgage-backed securities marked as a potential avenue for expanding the access to housing finance. Furthermore, the technology can also play a crucial role in facilitating the processes and enhancing the inclusivity within the housing finance ecosystem. Addressing key issues and working on actionable insights, sustainable urban development and socio-economic progress can be achieved through the creation of efficient housing market, collaboration with the stakeholder and reformation of policy and regulatory framework.