KATHMANDU, Nov 30: The government has removed the land ceiling for real estate companies and housing developers, allowing them to construct and sell housing units on land plots exceeding the previous legal limit.
A recent Cabinet meeting approved the Ninth Amendment to the Land-Related Ordinance, 2025, clearing the way for developers to resume large-scale housing and apartment projects. The ordinance has now been forwarded to the President for authentication.
Under the revised provision, real estate companies and housing developers can sell housing units built on land exceeding the prescribed ceiling. Property developers welcomed the decision, saying it would help revive a sector that has remained sluggish for years due to regulatory restrictions.
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Issuing a statement, the Nepal Land and Housing Developers Federation (NLHDF) expressed confidence that the new provision would contribute to economic recovery. NLHDF President Bishnu Prasad Ghimire said properties worth over Rs 200 billion have remained idle due to land ceiling restrictions.
“The amendment will allow the sale of stalled housing and apartment projects, enabling buyers to register properties and obtain official land ownership certificates,” Ghimire said, adding that the economy has slowed mainly due to the decline in real estate transactions.
Previously, developers enjoyed exemptions from the land ceiling. However, the restriction imposed in August 2009 curtailed large-scale housing projects, leading to a sharp decline in the construction of housing colonies, developers said.
Although existing laws allow companies to transfer and exchange land under their names, they did not clearly authorize the sale of housing units developed on such land—a legal gap the new amendment seeks to address.
According to the NLHDF, the revised provision will also boost related industries, including cement, iron, bricks, timber, aluminum and quarrying, while generating employment opportunities for youths.
The budget for the current fiscal year had already proposed allowing the sale of housing and apartment projects developed on land exceeding the legal ceiling, provided the projects had prior approval. It also aimed to cover land previously registered under industries and companies to prevent government acquisition.
Despite a recent reduction in lending rates for property buyers, the real estate sector has continued to slow over the past few years. Banks have simultaneously seen a rise in non-performing loans and an increase in non-banking assets.
Meanwhile, the NLHDF has urged the government to resolve delays in land classification. At present, local governments are responsible for land classification, but the process has stalled due to various administrative and technical issues.
