Learning in making housing finance accessible to all
It is worth emphasizing that in developing countries, the most effective mechanisms that have led to improvement in security of tenure and housing quality are attributed to the efforts by civil societies.
Asia has pioneered the people led process of housing provision as spearheaded by dedicated civil society groups. These are strong in the region and have gained ground in many cities as a result of efforts by various organisations. Civil society has promoted community led housing development in Cambodia, India, Indonesia, Mongolia, Nepal, Pakistan, the Philippines, Sri Lanka and Thailand. Asia is also testament to the fact that while the private sector is able to meet the housing requirements of the rich, the ‘people sector’ has been able to cater to the low income.
In Asia, formal market failure to cater to the low-income has spawned many innovative alternatives for housing, infrastructure and community development finance for low income groups. With their combinations of savings loans and subsidies, these innovations have had broad-ranging benefits, including negotiated land tenure security, housing construction and improvements, as well as water and sanitation.
As part of the “enabling” role of the public sector, and as advocated by international agencies with regard to housing, many public agencies have shifted operations from housing to finance. As a result, housing has become a significant part of the microfinance portfolio of many agencies, although borrowings are for house improvements and extension rather than new buildings.