Housing Microfinance Project in Tavush, Gegharkunik and Lori

On April 23 2010, Habitat Armenia started the implementation of a new housing microfinance project in the region of Tavush, Gegharkunik and Lori in partnership with "Nor Horizon" Universal Credit Organization. The project is a low cost solution that provides possibility for low income families to improve their housing need. In FY 2011 the project aims to serve up to 150 families which haven't proper living conditions, neither have access to traditional banking services. Currently we have already served more than 70 families in these regions. The project has an active progress in Tavush which features an immense housing need.

Social and Housing need in Tavush region: A large number of the Tavush region's communities (43 out of 62 communities) are located on the border with Azerbaijan which due to cross border conflicts has resulted in a reduction in potential agricultural land and higher incidences of female-headed households (122 families of war victims) and orphans (increasing the rates of poverty, in particular for refugees). Low birth rates, an ageing population (16% of the population) and a high number of disabled people (7%) and other vulnerable groups (7%) result in increased vulnerability of the population and communities as a whole. In response to the socio-economic hardship of the region many young families have emigrated, leaving their parents behind.

Housing remains a priority with 3% of the population still residing in temporary shelters, and 20% in accommodation that does not meet established norms of 9 square meters per person. Currently, there are more than 300 multi apartment buildings in Tavush region both in urban and rural areas. The majority of them have the need for capital renovation, out of which the major issues are the roof, entrance, stairwells and basement problems.

Partnership with families: HFHA offers to families a hands-up partnership opportunity. Habitat homeowner families build their own home with an affordable, long-term mortgage and also contribute hundreds of hours of volunteer labor or "sweat equity." Habitat Armenia cooperates with Nor Horizon" UCO in order to distribute the loans to the families. The mortgage payments go into a "Revolving Fund for Humanity" which is used to build more homes, thereby providing the financial foundation for a sustainable community development effort.

Selection of partner families: To be eligible for participating in the housing micro lending activities the future client must fit the following criteria.

Low income, economically active people living mainly in rural areas, who haven't proper living conditions and are demanding home improvement loans, but haven't access to traditional banking services because of low incomes and absence of collateral acceptable for banks, but are credit worthy, otherwise are generating stabile income and are able to direct part of that income to repay loan.