1960s
Summary
Savings & Loans and Housing Cooperatives.
Due in large part to increased external involvement in the region, the savings and loan model is adopted and serves primarily middle and upper income households. Housing cooperatives emerge throughout the region to provide housing to families without access to individual loans.
Influences
- Repressive regimes and military rule spread throughout the region.
- An economic downturn hinders governments' ability to develop and sustain housing finance systems.
- The public sector fails to meet demand for new housing and improvements to existing housing.
- The credit union movement gains ground in the region, yet it does not focus on housing.
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Policies and Programs
- The United States Agency for International Development (USAID) applies U.S. model of shifting from government finance toward savings and loans and mortgages.
- Social programs in Chile encourage participation from recipient families to solve the housing problem.
- The IDB creates a social project trust fund for housing.
- USAID issues housing grants via government agencies for below-market interest rate loans.
- Panama implements the first sites and services program.
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Institutional Roles
- The Interamerican Housing Union is created (UNIAPRAVI) in 1964 to promote the development of sustainable housing.
- USAID launches the Alliance for Progress and pledges $20 billion for poverty relief.
- In Mexico, the fund for Housing Finance promotes construction and improvement of housing.
- The first Mutual and Savings Loans Association is created in Bolivia in 1963.
- The Ecuadorian Bank of Housing is created with the purpose of directly financing welfare housing.
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Methods, Tools, and Practices
- The Institute of Secured Mortgages (FHA) in Guatemala develops successful systems for mortgage certificates and insurance.
- In Peru slums are renamed "pueblos jovenes" (young towns) to alleviate political pressure to eliminate them.
- Following a natural disaster, FUNDASAL, an NGO dedicated to housing the poor, initiates activities in El Salvador in 1968.
- "Appropriate Technology" for construction spreads as a low-cost way to build higher quality structures.
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Lessons and Outcomes
- The goal of affordability leads to sites and services and home improvement loan programs.
- Housing banks target formal housing markets and have limited impact on the poor.
- The Alliance for Progress results in limited economic advances.
- Housing cooperatives are successful and spread throughout the region through the 2000s.
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