Kuwait issues Decree-Law No. 114 of 2026 on housing mortgage finance: repayment over up to 25 years, with the State paying the interest on the subsidised part

What was issued

According to KUNA, as carried by Al Rai on 11 October and Gulf News on 12 October, Decree-Law No. 114 of 2026 on real estate financing for housing welfare beneficiaries was issued on Sunday. It aims to provide housing welfare at the right time and to remove the main financial obstacles to that, and its explanatory memorandum says it is meant to keep decent housing available to citizens for the foreseeable future. Article 2 sets its scope: buying a housing unit from a real estate developer under Law No. 118 of 2023, as amended by Decree-Law No. 89 of 2025, or building on a government plot allocated by the Public Authority for Housing Welfare, under the conditions the Authority sets for its housing projects.

Who qualifies

Under Article 3, the beneficiary must meet the general conditions of the Kuwait Credit Bank's real estate loan regulations for buying or building, and must not have received housing welfare from the State before, whether as a holder of a title deed to a government plot allocated by the Authority or through any Kuwait Credit Bank loan, whatever its value or purpose.

How the money works

Article 4 allows subsidised and unsubsidised financing to be combined under rules set by the Central Bank of Kuwait. The beneficiary repays the principal of both, plus the interest or returns on the unsubsidised part, while the State bears the interest or returns on the subsidised part. Article 5 sets equal monthly instalments over no more than 25 years from the first disbursement. Financing to build on a government plot is paid out in stages (Article 6). Under Article 9, the Kuwait Credit Bank signs the contracts with the financing entities on behalf of the State, and the Ministry of Finance pays the interest on subsidised financing to the Credit Bank from the General Reserve, which passes it on to the lenders. Article 13 requires the Central Bank to issue the rules for granting mortgage financing and to set the rate on unsubsidised financing.

If payments stop, and if you want to sell

A lender must first send a warning. It may then reschedule the financing for up to five years under Central Bank instructions, with the beneficiary paying the interest for the rescheduling period, or take legal action (Article 7). If the beneficiary defaults, the Credit Bank pays the lender the remaining balance of the subsidised financing on behalf of the State (Article 10). In return for that commitment, the Credit Bank takes a mortgage on the property, made by an official mortgage contract, which stays registered until the debt is fully repaid (Article 11). The mortgaged home cannot be sold, gifted or otherwise disposed of without prior approval from the Credit Bank and the lender, and only to a housing welfare beneficiary who has not had mortgage financing before and who takes over the obligations of the financing contract. Article 12 lets the Credit Bank, or a body named by the competent minister, buy these loans from the lenders, securitise them and sell them to investors.

What happens next

The executive regulations must be issued, on the proposal of the competent minister, within six months of the decree-law's publication in the Official Gazette (Article 14). They will set out the financing and rescheduling procedures, early repayment, the grace period and default cases (Article 8). The law applies to beneficiaries from the date the regulations are published (Article 15). The reports we opened do not give the size of the subsidised financing or the interest rate on the unsubsidised part, so we do not give them. We will update this story when they are announced.

What Al Mithaq adds

This decree-law is for citizens on the housing welfare list. If you are buying privately instead, for example a plot in Sabah Al Ahmad Sea City, it does not apply. Our Sea City land page lets you tell us the phase and budget you have in mind, and our team in Kuwait comes back with the plots available now, with their prices.

Sources

• Al Rai (KUNA), 11 October 2026: Decree-Law No. 114 of 2026 on real estate financing for housing welfare beneficiaries, article by article
• Gulf News, citing the Kuwait News Agency (KUNA), 12 October 2026: Kuwait issues new mortgage financing law for housing beneficiaries
• Arab Times (KUNA), 22 September 2026: Kuwait Cabinet clears fresh financing path for housing