Recent Activities
India - 2007 December
Metafinance of group-level improvements such as water and sanitation (W&S).
Activities: Research Report
In October, 2007, on behalf of Development Innovations Group (DIG), David Smith visited India to interview two non-governmental sponsors (NGOs) that are pioneering in the finance and development of group-level infrastructure:
- Mumbai (Maharashtra): National Slum Dwellers Federation, NGO facilitator of community toilets in Mumbai's slums and informal settlements.
- Ahmedabad (Gujarat): Mahila Housing SEWA Trust, NGO facilitator of community improvements (water, sanitation, power, grading, paving) in conjunction with Ahmedabad Municipal Corporation.
DIG commissioned the study as part of DIG’s Housing Finance for the Poor Initiative with the Gates Foundation.
The resulting report (click here for pdf version) not only summarizes the activities of these two entities, but also extrapolates likely conditions that make metafinance possible, presents a Basic Model for metafinance, highlights the importance of NGOs as business enterprises, and points a way forward for expanding the number of such entities that can pursue metafinance.
Cambridge, MA, USA - 2007 December 8
Harvard University Model-UN UNDP Working Group .
Activities: Presentation
David Smith spoke by invitation to Harvard University's Model-UN UNDP working group of 125 students on "The Challenge of Slums: Urbanization, Markets, Governments". Organizer Sara Cheche, A.B. Economics, Harvard College '09, said that after the presentation, "Debate has recommenced and the effect of your presentation on the quality of discussion is enormous!".
Bellagio, Italy – 2007, July 1- 6
Rockefeller Foundation: Global Urban Summit, Innovations for an Urban World.
Activities: Key Meetings
AHI founder David Smith was invited by the Rockefeller Foundation to a meeting of leaders from the private and public sectors convened to highlight the challenges cities, especially in the global south, face in an era of increasing globalization and demographic change. The participants' main purpose was to explore opportunities to foster healthy and sustainable cities and to formulate the agenda for a September workshop that will bring together ministerial leaders from the finance, health, transportation, environment and housing sectors. See Announcement.
Dublin, Ireland – 2007, June 12
RAS Long-Term Leasing Project
Activities: Program Design
AHI was contracted by The Affordable Homes Partnership (AHP), a Government of Ireland State agency working on behalf of the Department of Environment, Heritage and Local Government and local authorities, to provide housing finance expertise and program/public policy design to further develop a social/affordable housing program in the Greater Dublin Area. The resulting Rental Accommodation Scheme (RAS) Long-term Leasing Project is currently at the Request For Qualifications stage with the release of the final document.
The program aims to provide greater security of tenure to low income residents unable to find quality affordable housing in Ireland’s booming property market, to mitigate the extent of social segregation in housing and to improve integration between private and social housing developments. The key feature is a Public Private Partnership component, characterized by the innovative financial modelling AHI built into the program design:
- Through RAS, Local Authorities will source accommodation from the private rented market to meet long-term housing needs of households that currently depend upon Rent Supplement.
- Soft debt tools provide financial incentives to developers to secure long-term rental accommodation for low-income residents. Sponsors will receive up-front recoverable grant financing that can be used, for instance, to fund the construction of new units or the refurbishment of owned or newly-acquired units.
- Sponsors are required to ensure RAS residents receive professional quality management services. Thus, the project also seeks to encourage the emergence of a professional, permanent property management sector in Ireland’s rental market.
The program design allows the Irish government to provide market rate housing at a cost approximately 10% cheaper than it currently spends on social housing, and 30% less than on providing wholly market rate rental accommodation.
Istanbul, Turkey – 2007, April 25-26
7th Turkish Real Estate Summit
Activities: Presentation
Invited to serve on a panel by the Turkish non-governmental organization GYODER, David Smith spoke on the potential impact of the new mortgage law and on the urgent need to promote affordablehousing in Turkey. His presentation stressed that:
- Turkey would become a two-tiered society of wealthy owners and poor "own-nots" if the considerable housing affordability gap resulting from the booming real estate market were not addressed.
- Government must step up its financial committment to affordable housing.
- This would best be done in public-private partnership, because markets and government have complementary capacities and weaknesses.
- Government should adopt some form of credit enhancement, whether by mortgage insurance or other weaker forms, to cut interest rates immediately for a targeted group of borrowers, without necessarily spending public monies.