Affordable Housing - Concept

Topics: Subprime mortgage crisis, Developing country, United Nations Pages: 7 (2039 words) Published: August 2, 2010
Programme des Nations Unies pour les établissements humains • Programa de las Naciones Unidas para los Asentamientos Humanos 

United Nations Human Settlements Programme

Concept Note on Affordable Housing and Housing Finance in the Face of the Global Financial Crisis for the Luncheon Meeting, New York, 25 June 2009 Introduction In its resolution A/RES/63/221 entitled “Implementation of the outcome of the United Nations Conference on Human Settlements (Habitat II) and strengthening of the United Nations Human Settlements Programme (UNHABITAT)”, the General Assembly “invites the Governing Council of UN-HABITAT to keep under review developments in the housing finance systems in view of the current financial crisis, and further decides to explore the possibility of convening a high level event of the General Assembly on this subject.” As a follow up the theme of the 22nd Session of the Governing Council of UN-HABITAT, was “Promoting affordable housing finance systems in an urbanising world in the face of the global financial crisis and climate change” and the theme paper of that title was published on the UN-HABITAT web-site as a pre-session document (HSP/GC/22/4). During the discussion the Governing Council noted that the global economic crisis is having a detrimental effect on the progress being made to the implementation of the Millennium Development Goals in general and on affordable housing finance in particular, especially in developing countries, with new pressures being brought on inflation and high interest rates. Several representatives saw opportunities arising from those challenges, which could be a springboard for the development of innovative mechanisms to promote affordable housing. There was some discussion of the role of the State in that process, with a number of representatives speaking of the need for the public sector to facilitate the sustainable development of human settlements through supportive policy formulation and legislation, priority budget allocation, infrastructure development, and targeted subsidies for the poor. It was generally recognized, however, that the current financial crisis required innovative approaches that encouraged the involvement of all stakeholders, including international donors and agencies; private sector developers; financial and banking institutions; and nongovernmental and community-based organizations. Most representatives gave examples of the specific measures being undertaken in their own countries to build partnerships in a manner appropriate to the national setting. They concluded that as he global economic crisis continued, it was likely that the demand for microfinance would grow, and there was an urgent need to build further robust financing instruments at all levels. Innovative solutions were needed, including constructing new value chains that linked partners in unconventional ways In its resolution 22/2 entitled “Affordable Housing Finance” the Governing Council, “Supports the efforts made in exploring the possibility of convening a high-level special event at the General Assembly on the issue of housing finance systems in the face of the global financial crisis.” This luncheon meeting offers an opportunity to discuss the issues and suggest ways to frame the debate for the United Nations High-Level Conference on the World Financial and Economic Crisis and its Impact on Development. Housing Markets: In the recent period of high global liquidity prior to the global financial crisis, beginning with the recovery from the dotcom bubble of 2001 through the onset of the subprime crisis in July 2007, housing markets in emerging and frontier economies benefitted in major ways:  Increased flows of financing (both direct and in the form of credit enhancement) and technical assistance from international and regional development banks and development programs seeking to encourage: o Establishment or expansion of mortgage lending

  Adoption of legal and regulatory...
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