The government has lifted the land ceiling for real estate companies and housing developers, allowing them to build and sell housing units on land areas that previously exceeded legal limits.
A recent Cabinet meeting approved the Ninth Amendment to the Land-Related Ordinance, 2025, enabling developers to resume large-scale housing and apartment projects. The ordinance has been forwarded to the President for authentication.
Under the revised provision, real estate companies and housing developers can now legally sell housing units built on land beyond the prescribed ceiling. Developers have welcomed the decision, saying it will help revive a sector that has remained sluggish for years due to restrictive regulations.
The Nepal Land and Housing Developers Federation (NLHDF) issued a statement expressing confidence that the amendment will support economic recovery. NLHDF President Bishnu Prasad Ghimire said properties worth more than Rs 200 billion have remained stuck due to the land ceiling restrictions.
“The amendment will allow the sale of stalled housing and apartment projects, enabling buyers to register their properties and obtain official land ownership certificates,” Ghimire said, noting that the slowdown in real estate transactions has significantly impacted the economy.
Before 2009, developers received exemptions from the land ceiling. However, the restriction imposed in August 2009 hindered large-scale housing projects, sharply reducing the development of housing colonies.
Although existing laws permitted companies to transfer and exchange land under their ownership, they did not clearly authorize the sale of housing units built on such land—an issue the new amendment aims to resolve.
According to the NLHDF, the revised provision will also stimulate related industries, including cement, iron, bricks, timber, aluminum, and quarrying, while creating employment opportunities for young people.
The current fiscal year’s budget had already proposed allowing the sale of approved housing and apartment projects built on land exceeding the legal limit. It also aimed to protect land registered under industries and companies from government acquisition.
Despite a recent drop in lending rates for property buyers, the real estate sector has continued to face a downturn in recent years. Banks, meanwhile, have seen rising non-performing loans and an increase in non-banking assets.
The NLHDF has further urged the government to resolve delays in land classification. Currently, local governments are responsible for land classification, but the process has stalled due to administrative and technical challenges.
