"Islamic house financing:current models and a proposal from social perspective

Hasan, Zubair (2010): "Islamic house financing:current models and a proposal from social perspective. Published in: ISRA: International Journal of Islamic Finance, Kuala Lumpur , Vol. 3, No. Number 1 (10 June 2011): pp. 1-24.

Abstract

Shelter is one of the basic needs for human beings. Its availability for the people is an Islamic imperative. In view of the appalling living conditions of a substantial proportion of the population in most countries around the world, especially Muslim, Islamic banks have entered the field with various schemes for home financing. In this infant industry, this effort is understandably guided by the profit motive, but a social dimension has to surface in the course of time.Unfortunately, the models banks currently use for home financing remain under the juridical gaze, more so as the practice is not always found to be transparent. This paper looks at Islamic home financing models in a broader societal context. It evaluates the efficacy of the current financing structures practised and suggests a new approach.The proposed model is shown as superior to the existing ones. It meets the norms of equity, fair play and openness does not, presumably,violate any other Islamic norm. Finally, the paper makes some policy suggestions to integrate Islamic home financing into the broader social goals of an Islamic economy.

• Item Type: MPRA Paper
• English Title: Islamic home finance in the social mirror
• Language: English
• Keywords: Housing problem, basic needs, resource allocation, ruralurban migration, conventional model, BBA in housing, the MMP model, diminishing balances, planning.
• Subjects: D - Microeconomics > D1 - Household Behavior and Family Economics > D10 - General; G - Financial Economics > G2 - Financial Institutions and Services > G28 - Government Policy and Regulation; D - Microeconomics > D6 - Welfare Economics > D60 - General; G - Financial Economics > G2 - Financial Institutions and Services > G21 - Banks ; Depository Institutions ; Micro Finance Institutions ; Mortgages

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