Banks often consider low-income populations too risky for housing finance lending – which means in emerging market countries, finding ways to expand access to finance is essential to increasing homeownership, and therefore security of tenure. Mexico’s Sociedad Hipotecaria Federal’s (SHF) programs aim to promote the right conditions for Mexican families from both rural and urban areas to access mortgages and therefore, increase access to decent homes. SHF is a second-tier bank, so the subsidy is aimed at small, medium, and large developers, along with Housing Production Agencies.
In 2019, SHF granted bridge loans for US$1.2 million, along with a total placement for US$2.4 million, obtaining a profit of US$34.6 million. The success of this SHF has been attributed to a targeted and differentiated subsidy line, interest rate subsidies, effective communication strategy, post-subsidy monitoring, and access to technical support.
Source:
Rodríguez Armas, J. C. (2021) Barreras de Acceso a Programas de Subsidios a la Vivienda en Perú: Estudio y propuestas de innovaciones en políticas públicas” Habitat for Humanity International Terwilliger Center for Innovation in Shelter.
Link: https://www.ctivperu.org/segmento-de-la-construccion-progresiva-en-el-peru-2/