Incremental Housing Upgrades in Salima II

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Focus Areas: Housing

This project sees home improvements to two hundred (200) structures in Salima, through loans to Federation members. 

Location: Salima, Malawi

Deliverables:

The improvement of housing structures in Salima. Loans disbursed were used to improve roofing, replacing thatch with iron sheets; flooring, replacing mud with cement screed, and in some cases replacing mud blocks for walls with burnt bricks.

Community capacity:

This was an initiative spurred by landlords from various settlements in Lilongwe. The landlords have been meeting regularly to discuss ways in which they can save and improve their homes. 

Scale:

The project has the potential to be scaled up nationally as the demand for home improvement loans is quite high throught Malawi. However, this will only be possible repament rates continue to improve. The Federation will also need more support from the technical department to provide advise on how durable house improvements can be made. 

Impact:

The Federation has benefitted greatly from this project from the access to home loans. The revolving funds have been used to issue landlord loans. Thus far, US$5,304 has been issued to one hundred and thirty-nine (139) landlord households in the Central Province in Malawi.

Finance:

SDI Contributions:

SDI contributed US60,000.00

Resources Leveraged:

Land for low cost housing was leveraged from the District Council. 

State Subsidy:

The State subsidy was in the form of land for the construction of low cost housing in Salima as well as in the form of technical assistance. 

Market Generated Returns:

None to date.

Costs recovered from community:

As of Dec 2013, US$5,304.00 had been repaid into the revolving fund. 

Patrick Chikoti patrickchikoti@gmail.com (+265) 1 756 781 View Website
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Project information updated: 12 January 2016

Project in depth

Detailed Information

This project sees the Malawi Alliance of Centre for Community Organisation and Development (CCODE) and The Federation of Rural and Urban Poor (previously known as the Malawi Homeless People's Federation) respond to the need for housing upgrades in Salima in 2011. 

Deliverables:

The aim was to disburse loans to landlords for the improvement of two hundred (200) houses.

Community capacity:

The Federation is investigating how repayment rates can be improved given the increasing number of loans. They have come up with a performance based loan management and collection system. In this system, Federation members are capacitated to function as community loan officers. 

Scale:

Scaling up to the national level has almost been completed. Poor people residing in over ten (10) districts in Malawi have accessed home improvement loans. The loans have been used to buy iron sheets, undertake house renovations and to fix windows. 

Impact:

The loans have improved the living conditions of the beneficiaries' households. The project has also gone some way to highlight the ability of communities to improve/upgrade their living conditions as opposed to them relocating to new structures. 

The revolving funds have been used to issue landlord loans to more households. This has allowed the Federation to demonstrate and prove that the revolving model does work and can improve the lives of the urban poor. The Federation has also been able to improve on its systems relating to the fund to ensure that repayments are coming through and that loans are repaid. 

Finance:

SDI Contributions:

SDI contributed US$60,000.00 of which US$12,000.00 went towards project-linked technical assistance. 

Resources Leveraged:

Land was leveraged for the construction of low cost housing in Salima. This land was obtained during negotiations between the Federation and the Salima District Council. 

State Subsidy:

The State subsidy was in the form of land and technical assistance. 

Market Generated Returns:

None to date. It bears mentioning that one of the challenges experienced by the project was the devaluation of the kwacha. This presents a significant challenge to the project going forward as it means greater loan amounts must be disbursed reducing the number of people who will benefit from the loans. However, measures have been taken to mitigate the impacts of the currency devaluation. 

Costs recovered from community:

US$5,304.00 has been recovered to date. This amounts to approximately eleven (11%) of the total funds disbursed have been revolved to fund new loans to landlords under this project. 

Houston, A. (2011). Housing Support Services for Housing Microfinance Lending in East and Southern Africa: A Case Study of Centre for Community Organisation and Development / Malawi Homeless People's Federation / The Mchenga Urban Poor Fund. [Online]. Available: http://www.housingfinanceafrica.org/wp-content/uploads/2012/03/CCODE-case-study2.pdf
 
Malawi Homeless People's Federation & CCODE. (2009). Report on Preparatory Works for UPFI Projects in Malawi. [Online]. Available: http://sdinet.org/wp-content/uploads/2015/10/Malawi_Report_to_UPFI_.pdf


Malawi Homeless People's Federation. (2011). Federation Sensitizes Community Leaders on Slum Upgrading. [Online]. Available: http://halala-homelessbutnothopeless.blogspot.co.za/2011/03/federation-sensitize-community-leaders.html

Funding Information

Raised:

$60,000.00

Funding type:

Grant funding

Implementing Partners

Bill and Melinda Gates Foundation


Centre for Community Organisation & Development (CCODE)


Homeless People's Federation of Malawi