Promoting Private Sector Participation in Low-Income Housing Finance: Diagnosis and Policy Recommendations for Latin America

Inter-American Development Bank

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Date Published 2007
Primary Author Remy Cohen
Other Authors


The population of Latin America is poorly housed; although average housing indicators for the region are not far from world middle-income countries with 220 houses per 1,000 inhabitants, they mask wider differences among segments of the population. Out of the estimated 127 million households in the year 2005 in Latin America and the Caribbean, at least 50 million faced housing problems, with more than half of them doubling up with other families and the rest living in deficient housing units. Today the region’s housing sector faces a double challenge: to provide housing for families facing housing problems, which requires the construction of at least 30 million new units and improvements to 20 million existing homes, and to produce sufficient homes for the nearly 3 million newly forming households each year. Unfortunately, Latin American economies have proven incapable of handling this challenge; at best the formal sector of the economy has produced only 30% of the units needed for existing households and, with few exceptions, are producing only a slightly higher percentage of the houses needed for newly forming households.1 Furthermore, formal construction and financing operations are mostly limited to satisfy the needs of high and middle-income families.

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