"Based on the experience of the 2008 crisis, if the real estate subsidy program stops, it will trigger a chain reaction and the whole economy will collapse”, Irakli Rostomashvili, the head of the Georgian Association of Developers declares and considers that real estate subsidy program must be continued.
Rostomashvili told TV-program Business Morning that it would be difficult for the sector to cope the challenges in 2021 without the government’s assistance and that would be negatively reflected not only on the developer companies, but also on the population.
“By stopping subsidizing the real estate, we will get the same picture as we already have in terms of pandemic management. We started well, but now we see how the process is continued. The subsidy has led to the fact that the developer market has not collapsed, which is not just the developer companies, it includes buildings and their value.
The government helped the construction sector when there was not such a difficult condition. However, now when we have the worse wave it really can’t be stopped. Concrete steps must be taken," Rostomashvili said.
According to the Minister of Finance Vano Machavariani, the budget allocated for the mortgage loan subsidy has already expired. The government thinks that the business sector has been given a good incentive, but there will be no need to continue the subsidy program from 2021.
