Dominican Republic: World Bank Approves US$100 Million in Support of National Housing Plan
WASHINGTON – The World Bank has approved a US$100 million loan to increase access to affordable and resilient housing in the country under the Government of the Dominican Republic’s flagship program “Happy Family National Housing Plan” (Plan Nacional de Viviendas Familia Feliz, PNVFF) with a focus on low-income households, including those led by women.
“The World Bank is committed to supporting the Government’s efforts to provide affordable housing and improved urban living conditions to eligible households,” said Alexandria Valerio, World Bank Representative for the Dominican Republic. “The project aims at providing financing to help 44,000 households acquire their first home by 2026, guaranteeing access to housing, basic services and infrastructure to allow them to increase their economic autonomy.”
The Support to the National Housing Program Project will be led by the Ministry of the Presidency (MINPRE) and it will finance activities to close an overall housing affordability gap in access to and ownership of housing in the Dominican Republic. The main project component will finance upfront housing subsidies for eligible households under the PNVFF, led by MINPRE through the National Housing Fund (Fondo Nacional de la Vivienda, FONVIVIENDA).
The Dominican Republic has a housing deficit estimated at 1.4 million units (51 percent of all housing units). 26 percent of this deficit is due overcrowded conditions and annual new demand, while 74 percent of the deficit is due to housing that requires improvements due to poor-quality materials, or lack of access to basic services such as water and sanitation. A large share of Dominicans does not have access to adequate housing, and more than a third of the population lives in houses considered structurally vulnerable to natural events. In addition, closing the gender gap in access to affordable housing through improved beneficiary targeting is also needed.
The Project’s Key expected outcomes include: (i) supporting approximately 44,000 low and moderate-income households in the process of acquiring their first home; and (ii) providing 19,000 people with improved urban living conditions. The Project is also expected to contribute to: (i) protecting families against the effects of climate change through an increased supply of formal, affordable, resilient, and green housing; (ii) mobilizing private sector financing for affordable housing; and (iii) closing the gender gap in access to affordable housing through improved beneficiary targeting.
The PNVFF aims to benefit approximately 140,800 low and moderate-income individuals and is expected to provide 20 percent of the total subsidies to 8,800 female headed households, of which the World Bank loan will support approximately 4,000.
The proposed Project will support the PNVFF to make formal housing accessible at a lower price for households previously excluded from the market. The variable spread loan has a final maturity of 35 years including a grace period of 5 years, in US Dollars.