Published on 08-Dec-09

Dec. 8, 2009 - The Inter-American Development Bank approved a $15 million loan to provide housing solutions to approximately 3.000 Surinamese households, both along the coast and in Suriname’s interior.

Upfront subsidy

Dec. 8, 2009 -- The Inter-American Development Bank approved a $15 million loan to provide housing solutions to approximately 3.000 Surinamese households, both along the coast and in Suriname’s interior.

The Program will address two key problems in the housing sector: (i) low-quality of the housing stock; and (ii) lack of affordable housing solutions on the market for low income groups. It will do so by supporting coordination efforts by the Ministry of Social Affairs and Housing (SoZavo).

The financing will allow people who cannot afford traditional mortgage loans to access financing for new housing or improve an existing solution, by providing a single upfront subsidy of $3.000. It will also pilot projects to provide residential land and/or a housing solution at prices that are affordable to low income households.

Suriname’s current housing policy and programs focus primarily on middle income groups. Moreover, its population faces limited access to land, titling and registry. The proposed program will reach families in the bottom 40% of the income distribution who are currently underserved by public housing programs.

By the end of the five-year project, it is expected that more than 1.000 of the poorest families in the country will have a new house and 2.000 will rehabilitate or expand their home. The project will also make the allocation of subsidies more efficient.

The loan is for a 25-year term, with a five-year disbursement and grace period, and carries a Libor-based interest rate. The Government of the Republic of Suriname will provide $314,000 in local counterpart funds.