A major earthquake in Haiti in 2010 killed more than 230,000 people, displaced nearly 1.5 million more, and destroyed more than 180,000 homes, exacerbating an already existing housing shortage.
Despite an influx of foreign aid, years after the earthquake inadequate housing options remain a challenge for Haitians. In 2015, with funding from the U.S. Agency for International Development (USAID), the World Council of Credit Unions started the Haiti Home Ownership and Mortgage Expansion (HOME) Program.
The three-year pilot project applies targeted financial incentives, technical assistance, and awareness-building to mobilize the development and purchase of affordable housing in Haiti.
During the pilot, HOME will help 1,750 low-, moderate-, and middle-income households build or improve their homes through targeted housing finance and technical assistance. It also will provide approximately 8,000 Haitians with new or improved homes.
While the program’s targets might seem small in comparison to the housing need in Haiti, the genius of the project lies in its replicable and scalable model.
Instead of imposing solutions on the Haitian housing market or employing a traditional model that funds construction, the HOME Program provides financial rewards for specific results to financial institutions and developers through its HOME Facility grant fund.
Through its market-based approach, HOME facilitates and incentivizes existing actors on both the demand and supply side of the housing value chain through a “pay for performance” model to create affordable housing options.
“We have seen so many empty and run-down public housing projects in Haiti,” says World Council President/CEO Brian Branch. “They’re built as a supply-driven response to a need for low-income housing but they’re often built far from employment opportunities and with limited transportation access. With this program, we’re offering technical support and product development with incentives to credit unions and nonbanking institutions to provide family home mortgages for lower-income populations.”
To date, HOME partners—including two of the largest credit unions in Haiti, the second largest microfinance institution, and prominent developers—have committed $13 million in private funds in exchange for $991,200 in grant funds to spur affordable housing.
These investments expand access to housing finance to unserved or underserved Haitians such as Joselande Kenole Moute. “Financing a house and borrowing to build is something I thought was reserved for rich people,” she says.
CARA BIDWELL is a program officer for World Council.