Kuwait Issues Housing Finance Law for Citizens Awaiting State Housing, With Repayment Up to 25 Years

Kuwait has issued Decree-Law No. 114 of 2026 on real estate finance for those entitled to state housing welfare, published in Kuwait Al-Youm Issue 1813 (pages A2 to A6) on Sunday 18 October 2026. The decree-law was issued on 11 October 2026 and has 15 articles.

It applies to finance from local banks, finance companies and investment companies supervised by the Central Bank of Kuwait (CBK) for two purposes only: building on a government plot allocated by the Public Authority for Housing Welfare, or buying a unit from an approved real estate developer under Law No. 118 of 2023 (Article 2). Finance is available once only, and not to someone who has already received state housing care or any Kuwait Credit Bank loan (Article 3).

The finance can be subsidised, where the State bears the interest or return cost, or unsubsidised, and a beneficiary may combine both. Repayment is in equal monthly instalments over no more than 25 years, with a grace period set by the regulations (Article 5). On default, the lender must warn the borrower, then reschedule for up to five years or take legal action (Article 7).

The Credit Bank signs the contracts with lenders on behalf of the State, and guarantees the remaining subsidised balance to the lender if the borrower defaults, taking a registered mortgage in return and keeping a right of recourse against the borrower (Articles 9 to 11). The property cannot be sold or charged without the approval of both the Bank and the lender. The Bank, or an entity named by the Minister, may buy the financing, securitise it and sell it to investors under CBK and Capital Markets Authority rules (Article 12).

The law applies to beneficiaries only from the date the Executive Regulations are published; these must issue by decree within six months of publication (Articles 14 and 15). The CBK will set the lending rules and the rate on unsubsidised finance (Article 13).

WEFAQ's view: banks, finance companies and developers should start preparing now for the CBK rules and the Executive Regulations, particularly the mortgage and securitisation mechanics.

Read more: for the full analysis, read our companion blog article: 'Kuwait's New Housing Finance Law 2026: What It Means for Families, Banks and Developers'.

Source: Decree-Law No. 114 of 2026 on real estate finance for those entitled to housing welfare, with its explanatory memorandum; Kuwait Al-Youm Issue 1813, pages A2 to A6, dated 18 October 2026.

This article is provided for general information only and does not constitute legal advice. For advice specific to your circumstances, please contact WEFAQ Law Firm.