Advisory Center for Affordable Settlements & Housing

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Document Type General
Publish Date 15/12/2022
Author Arun Kumar Chowdhury, et.al
Published By Bangladesh House Building Finance Corporation
Edited By Saba Bilquis
Uncategorized

Rural and Peri-Urban Housing Finance Project-Second Phase

Rural and Peri-Urban Housing Finance Project-Second Phase

The document is a feasibility study report prepared by the Bangladesh House Building Finance Corporation (BHBFC) for the “Rural and Peri-Urban Housing Finance Project – Second Phase.” It outlines the project’s objectives, methodologies, and expected impacts on housing finance accessibility for lower and middle-income groups in Bangladesh.

Executive Summary

The report emphasizes the critical role of the housing sector in fulfilling basic human needs and contributing to the national economy. BHBFC, as a state agency, has been actively working to enhance access to housing finance, particularly for lower-income populations. The first phase of the project, supported by the Islamic Development Bank (IsDB), successfully provided housing solutions to 10,715 units, benefiting around 64,290 residents. Encouraged by these results, BHBFC aims to continue its efforts through the second phase, which focuses on eco-friendly and climate-resilient housing solutions.

Project Background

The project identifies a significant need for affordable housing in rural and peri-urban areas of Bangladesh. The rationale behind this initiative is to address the growing demand for housing finance among low- and middle-income households. The study’s objectives include assessing market demand, analyzing potential interventions, and evaluating stakeholder involvement.

Market Demand Analysis

The report presents a detailed analysis of housing finance demand, highlighting several key factors:

  • Problem Statement: There is a notable gap in affordable housing options for lower-income households.
  • Relevance: The project is relevant as it aims to fill this gap by providing financial assistance tailored to the needs of these demographics.
  • Proposed Interventions: The project will implement various strategies to enhance access to housing finance.

Demand Estimation

The analysis includes projections of housing loan demand over five years (2023-2028), indicating a steady increase in need. A supply-side approach is utilized alongside an income-affordability assessment to determine feasible financing options for potential beneficiaries.

Technical and Financial Analysis

The report reviews technical aspects such as cost estimation and financing structures. It suggests that careful financial planning will be essential for the project’s success. The financial analysis indicates that with proper funding mechanisms, BHBFC can effectively meet the projected demand for housing loans.

Environmental Sustainability

A significant focus of the second phase is on environmental sustainability. The report discusses potential environmental impacts associated with the project and recommends countermeasures to mitigate these risks. It emphasizes developing models for eco-friendly housing that can withstand climate-related challenges.

Institutional Framework

BHBFC’s role as the executing agency is underscored, detailing its organizational structure and performance metrics. The report highlights the importance of human resources in implementing the project effectively.

Lessons Learned

The document reflects on lessons from previous phases, noting challenges such as limited penetration into rural farming communities and rising construction costs. It also discusses repayment scenarios and emphasizes awareness campaigns to educate potential beneficiaries about available financing options.

Risk Analysis

A thorough risk assessment identifies uncertainties that could affect project implementation. Strategies are proposed to manage these risks effectively.

Conclusion and Recommendations

The report concludes with recommendations for enhancing project implementation strategies. It stresses the importance of continuous monitoring and evaluation to adapt to changing market conditions and ensure that the project’s objectives are met.

In summary, this feasibility study outlines a comprehensive plan for expanding housing finance access in Bangladesh’s rural and peri-urban areas through targeted interventions, sustainable practices, and robust institutional support. By addressing both economic and environmental concerns, BHBFC aims to create a lasting impact on housing accessibility for lower-income populations while contributing positively to national development goals.

Rural and Peri-Urban Housing Finance Project

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