The country's real estate business is expecting a boom-time due to a possible rise in demand fuelled by home loans for public servants at single digit interest rates.
Stable political situation and relatively swift electricity connections also remain positive factors in this regard, realtors believe.
They expect the sector to grow fast following the government's announcement of loan schemes for its more than a million employees at 5.0 per cent rate.
State-owned Sonali, Rupali, Agrani and Janata banks, and Bangladesh House Building Finance Corporation (BHBFC) will disburse the loans.
According to the Real Estate and Housing Association of Bangladesh (REHAB), the realtors have over 20,000 ready flats up for sale to middle-class buyers.
REHAB first vice-president Liakat Ali Bhuiyan said real estate has picked up since 2017 with support from stakeholders like government, lenders and utility service providers.
"Several private commercial banks and financial institutions also offer home loans at single-digit interest rates," he told the FE.
Such loans are helping many people fulfil their dream of having a flat in Dhaka city, Mr Bhuiyan mentioned.
The government's recent move to offer low-cost home loans to its employees is thus helping the real estate sector to gain long-term stability, he said.
Haling the initiative, the REHAB leader said low-cost loans for nearly 1.2 million public servants will contribute significantly to the national economy.
More than 260 sectors are dependent on the real estate sector, he remarked.
Mr Bhuiyan said medium-sized flats (1,200 to 1,500 square feet) are still in demand in cities like Dhaka and Chattogram.
REHAB members have been out to do business in Dhaka's adjacent districts like Gazipur and Narayanganj, and in other divisional cities, he added.
Citing the sector's growth at 5.0 per cent to 7.0 per cent since 2017, he said a relatively calmer politics has boosted public confidence in real estate.
However, property buyers, especially the middle-class ones, still think that the housing prices have been going out of their affordability.
The apex body of realtors pinpointed higher flat and plot registration costs as one of the key reasons behind this rise in property prices.
About high property prices, private jobholder Afif Ishtiak said his family wanted to buy a medium-sized flat in Rampura area at Tk 8.0 million.
"We found a desired apartment (1,400 square feet) six months ago at Tk 7.7 million (Tk 5,500 per square feet), which would consume almost our whole budget."
"The registration fee of the property would be around Tk 1.2 million," Mr Ishtiak said.
The same apartment now sells at Tk 6,000 per square feet, he said. "Either we have to buy a flat outside the main city or sell the old one to have a new one."
Unlike the neighbouring countries, Mr Bhuiyan said, a purchaser here needs to pay 14 to 16 per cent in taxes to buy a plot or flat.
The costs include 4.0 per cent gain tax, 3.0 per cent stamp fee, 2.0 per cent registration fee, 2.0 per cent local government tax and 3.0 per cent Value Added Tax (VAT).
The government also imposed 2.0 per cent VAT on the resale of a flat in the 2018-19 fiscal budget, thus making second-hand flats costlier.
Meanwhile, on September 25, four banks and BHBFC signed a memorandum of understanding with finance ministry to provide low-cost home loans for the public servants.
Under the deal, a disburser will charge 10 per cent interest, but a loanee will pay 5.0 per cent interest and the government will subsidise the rest.
The loan ceiling will be the highest Tk 7.5 million and the lowest Tk 2.0 million as per an employee's grade and job location.
The total amount will be payable in 20 years.
When contacted, a BHBFC official said they were yet to get any instruction from the authorities concerned to disburse loans for public servants.
Talking to the FE, BHBFC managing director Debasish Chakrabarty said, "They are all set to launch the loan programme, but there are still some technical issues to address."
The disbursement process might start this week after getting instruction from the government, he hinted.
Many loan seekers are already communicating with the BHBFC to know about its disbursement plan, he stated.
Mr Chakrabarty said, "The process initiates soon after the loan is sanctioned by the government."
Under the scheme, an applicant can get loan only for buying a ready flat, he added.
Mr Chakrabarty said the REHAB can play a vital role in helping government employees find such flats.
The BHBFC has planned to work with REHAB in organising special arrangements for public servants to make things easy for them, he added.
A total of Tk 3.0 billion has been allocated as government subsidy in the current fiscal year.
Rupali and other disbursers are in the process of issuing a circular to this end by this week.
Talking to the FE, a general manager of Rupali Bank also spoke of launching the loan scheme by this week.
About the delay in disbursements, he said there are still some technical issues to be addressed before launching the scheme formally.
In another development, the scam-hit Basic Bank also wants to disburse home loans.
On September 26, Basic Bank managing director Muhammad Awal Khan wrote to finance ministry with a plea for its engagement in the process.
Agrani, Sonali, Janata, Rupali, Basic and Bangladesh Development Bank Ltd now offer home loans to any eligible person at 9.0 per cent interest rate.
According to the Bangladesh Bank data, 14 local private commercial banks are offering home loans at 9.0 per cent to 12 per cent interest rates.
They are BRAC, Dutch-Bangla, Eastern, IFIC, Trust, Union, Shimanto, Shahjalal Islami, First Security Islami, EXIM, Dhaka, Bangladesh Commerce and Al-Arafah Islami banks.
Four foreign scheduled banks -- HSBC, Commercial Bank of Ceylon, State Bank of India and Standard Chartered Bank -- also offer home loans at the same rates.
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