ProMorar Brasil: sustainable housing solutions to improve urban living

Este artículo está también disponible en / This post is also available in: Spanish

There is also a Portuguese version of this post published in Ideaçao: Banco de inovação em gestão pública no Brasil.

A $54.5 million loan, signed on December 19, aims to facilitate access to affordable housing solutions.

The objective of the ProMorar Brasil credit operation is to foster new housing strategies and improve the quality of life for the Brazilian population, prioritizing low-income families. The operation, to be executed by the National Housing Secretariat of the Ministry of Cities, was approved by the Inter-American Development Bank's Board on June 28, 2023, and signed on December 19, 2024.

The main goal of this operation is to create and implement a national housing improvement program, enabling low-income families to renovate their homes through access to broader and lower-cost microfinancing. To this end, a federal first-loss guarantee directed at microfinance agents will attract private investment into the housing sector and encourage more accessible financing.

Another goal of the program is to improve the connection between housing supply and demand through a digital platform that will gather sectoral data and measure its climate impact. This tool will enable a more effective response to the housing deficit.

The third objective is to consolidate the national housing plan by promoting social and environmental sustainability and training professionals in the sector, especially employees of subnational governments. A specific focus is on training architects, engineers, and other professionals in housing improvements to encourage sustainable interventions with greater impact on climate change mitigation and adaptation.

The loan also places special emphasis on gender and diversity inclusion through enhanced production of disaggregated sectoral data, training municipal and state housing agents, among other initiatives.

Contributing to a broader and more inclusive housing policy

Brazil's National Housing Policy, whose flagship program is "Minha Casa, Minha Vida" (MCMV), relies on a set of indicators reflecting the country's housing needs, which vary regionally. These indicators guide two key strategies: the construction of new housing and the improvement of existing homes.

The first indicator, represented by the housing deficit calculated by the João Pinheiro Foundation, combined with future housing demand estimated based on demographic projections and family formation studies by the Federal Fluminense University, points to the need to increase housing stock.

Projects under the Minha Casa, Minha Vida Program to produce new housing.

MCMV Program works to create new housing.
The second indicator relates to housing inadequacy (known as qualitative deficit in other countries), classified by the lack of urban infrastructure (water, electricity, sewage, and waste management), land tenure irregularities, and structural deficiencies (water, absence of exclusive bathrooms, roofing, flooring, and bedroom use).

Housing inadequacy in Brazil affects approximately 26.5 million households, with structural deficiencies present in 12.3 million of them, according to the João Pinheiro Foundation. Addressing this issue through housing policy remains an area for innovation, particularly in developing and consolidating models to assist low-income families.

Housing programs and policies in response to Brazil's quantitative and qualitative challenges.

Programs and policies addressing Brazil's quantitative and qualitative challenges.
Since 2020, the technical cooperation initiative "ProMorar: Promoting New Housing Strategies in Brazil for Low-Income Populations," a partnership between the National Housing Secretariat (SNH) and the IDB, has been working on structuring solutions to diversify housing assistance options.

One outcome of this partnership was the publication of Habitação de Interesse Social no Brasil: Construindo Novas Oportunidades, a compilation of studies and expert suggestions based on sector diagnostics aimed at improving and diversifying housing policies. Housing improvements emerged as a priority in this analysis.

Notebooks from the "Social Housing in Brazil" Collection.

Technical materials from Habitação de Interesse Social no Brasil.
Housing improvements became a federal government priority, included in the 2023 MCMV program as a dedicated improvement line. On August 21, 2023, National Housing Day, the event "The Future of Housing Improvements in Brazil" gathered the Federal Government and partners at the IDB to advance the agenda.

Why housing improvements are crucial for low-income families living in substandard conditions

Creating a dedicated housing improvement program seeks to assist urban low-income populations in addressing structural inadequacies through interventions that enhance the quality of housing and living conditions.

Observing the reality of low-income families across Latin America, who invest incrementally in their homes, the establishment of an accessible housing microfinance market-currently nonexistent in Brazil-is both appropriate and essential.

In this context, creating a housing assistance model based on affordable credit, aligned with families' financial capacities without overburdening their budgets, is not only viable but urgent and timely.

The success of this model must necessarily rely on technical assistance actions to ensure that projects are carried out with quality and sustainability, avoiding the waste of financial and material resources while ensuring the correct and safe execution of interventions. In this regard, the Sustainable Housing Improvement Collection was published as another outcome of the ProMorar technical cooperation. This collection compiles a robust and innovative technical and conceptual framework for housing improvement interventions, focusing on the sustainability tripod. It provides suggestions, techniques, and tools aimed at helping construction professionals and beneficiary families execute more appropriate, efficient, and sustainable interventions.

Technical materials from Sustainable Housing Improvements.

Additionally, personalized attention tailored to the specific needs of beneficiaries will be provided. Beneficiaries will collaborate with technical advisors to decide on the improvements based on approved credit.

By structuring this microfinance line through public-private collaboration, Brazil's National Housing Policy will enhance its ability to address the pressing need for concrete measures to tackle one of the country's greatest social challenges.

Housing improvements as an international best practice

Recent advances in the federal housing improvement program were showcased at the 12th World Urban Forum, organized by UN-Habitat, in Cairo, Egypt, from November 4 to 8, 2024.

The event "Housing Improvements in the Minha Casa Minha Vida Program: Coordinating Public, Private, and Civil Society Actors for an Urgent Challenge," held on November 6, featured key developments in the field. Results from the partnership between Vivenda and the IDB Lab in the Reformar program, valued at $650,000, were also presented. This program has facilitated the acceleration and certification of 72 new improvement companies and completed 1,538 renovations in its first year, 85% of which benefited women-led households.

Networking Event: "Housing Improvements in the Minha Casa Minha Vida Program" at the 12th World Urban Forum

Housing improvement was also the focus of three additional events. The Network Event "Housing for All - Green, Resilient, Inclusive, and Affordable," organized by the Asian Development Bank, the IFC (World Bank Group), the IDB, and Habitat for Humanity, promoted adequate housing as one of the main drivers of inclusive economic growth and livability. During this event, the creation of a new microcredit market for housing improvements in Brazil was presented as a case study.

The Training Event "Inspirational, Inclusive, and Incremental: Building Successful Communities for Resilient, Affordable, and Quality Social Housing," hosted by the International Union of Architects, included representatives from the governments of Brazil, the United States, and Egypt. The session explored the relationship between social housing and the 2030 Agenda, emphasizing the production of resilient, accessible, and well-designed housing solutions.

Finally, the event "Progressive Housing as an Opportunity to Build Green and Resilient Communities: The Experience of Latin America and the Caribbean," organized by the Urban Habitat Practices Platform, addressed progressive housing and housing improvement practices. Discussions covered behavioral changes for learning, carbon footprints and financial impacts, capacity building in communities, innovative materials and construction techniques for sustainability, public policies and regulatory frameworks, and accessible financing.

With the signing of the loan agreement, the actions under ProMorar Brazil, presented at the World Urban Forum and developed over recent years through cooperation between the IDB and SNH, will be implemented. These initiatives will expand the federal government's capacity to provide solutions through social housing policies and programs, benefiting not only low-income families but also subnational governments (states and municipalities), private sector stakeholders, and civil society.

Public link

Please use the above public link if you want to share this noodl on another website.