Uzbekistan introduces guaranteed escrow system for housing purchases

A guaranteed escrow system for purchasing homes is set to be introduced in Uzbekistan. The announcement was made during a meeting focused on the development of the construction industry and building materials, chaired by President Shavkat Mirziyoyev on September 23.

The decision comes in response to a growing number of disputes between developers who fail to deliver promised housing and residents who are left without homes or funds. To address this issue, a working group led by the Minister of Construction studied international practices, as instructed by the President.

Under the new system, developers will collaborate with banks to facilitate home sales. Instead of paying the developers directly, homebuyers will transfer their funds to the bank, which will hold the money in escrow. The bank will then release the funds to the developer only upon the completion of specific milestones in the construction process, ensuring that the housing is delivered on time and to the agreed-upon standards.

The system will be tested over one year in Samarkand city, as well as the Yangihayot and Sergeli districts of Tashkent. This initiative aims to protect buyers and ensure greater accountability in the construction industry.