The Affordable Housing Challenge and Sustainable Development in the Global South
The global South faces a significant affordable housing crisis, with an estimated 1.6 billion people lacking adequate housing by 2025. Several factors contribute to this crisis, including the growth of informal settlements, overemphasis on homeownership, and policies that push low-income individuals out of urban areas1. Environmental threats, lack of secure land rights, financial exclusion, and bureaucratic red tape amplify these challenges. However, providing scalable, affordable housing solutions of all tenure types can significantly enhance health and economic opportunities for low-income individuals while promoting green growth and urban resilience.
Altair specialises in the housing sector and has successfully worked with clients to address these challenges. Altair offers high-quality, creative solutions to the varied and dynamic challenges facing organisations in housing and regeneration. Services range from strategic and tactical advice to overseeing large development and regeneration projects2.
For instance, Altair’s work in Nigeria provides a blueprint for how the firm can aid in tackling housing challenges. Altair advised on the business planning of Family Homes Funds Ltd (FHFL), an innovative housing finance institution the Nigerian Federal Government set up in 2017. Altair was instrumental in setting out FHFL’s core business objectives, providing recommendations to promote affordable housing, and assisting in financial and business planning. As a result of Altair’s early support, FHFL’s credit rating improved, its profit before tax grew by 334% between 2020 and 2022, and it has provided financing for over 15,000 affordable homes3.
Altair also collaborated with the Rwandan government’s environmental agency, FONERWA, on Africa’s first green city project. They conducted a housing and mortgage market sector analysis, identified housing finance options to raise long-term capital for affordable housing, and supported the client in setting up a new company, the Green City Kigali. Altair’s comprehensive analysis and financial modelling played a crucial role in this project’s success4.
However, addressing the affordable housing challenge in the global South involves more than financing and constructing homes. It necessitates an integrated approach that considers the quality of build, the cost of building maintenance and upkeep, the legal and financial recognition necessary to obtain or access housing finance in a formalised system, policy and regulation and the impact of housing construction on the environment. Governments must also acknowledge that most new-build housing in the global South is incremental and self-built. Policy recognition of this, combined with supportive regulation, can provide a sustainable framework to scale up low-carbon construction, integrated services, and improved community resilience.
While the task is immense, the potential benefits are substantial. Improved housing can contribute to economic productivity, sustainability and increase city equity. At Altair, we see our role as critical to help clients navigate this complex landscape, providing expert advice and creative solutions to help meet the affordable housing challenge in the global South. To read the previous article in the series, click here.
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