Affordable housing for all is at the core of the government's National Housing Project. But Reem Leila finds out this is not necessarily picture perfect For many years the government has attempted to provide suitable housing for low-income families, especially the youth. The National Housing Project (NHP), which was launched by President Hosni Mubarak in 2005, is a serious attempt to overcome the problem by building some 500,000 housing units in new cities and governorates by 2011. In fact, building these houses was one of Mubarak's campaign promises to the electorate in last year's presidential elections. But according to experts, the NHP was shelved for about one year until the government decided to pick it up again in late 2006. Minister of Housing, Utilities and Urban Communities (MHUUC) Ahmed El-Maghrabi announced in August that some 20,000 low-cost housing units were completed in traditionally higher-end suburbs, such as the cities of 6 October, Al-Shorouq and Sheikh Zayed. Last week, El-Maghrabi declared that another 91,000 units will be delivered to their owners within two years instead of the scheduled three. He said that the distribution of units will begin once basic utilities are complete. The NHP plans to build half of the units in various governorates, while the rest will be located in new cities and suburbs. The project provides applicants with a non-refundable grant, which can reach LE10,000 for those whose income is less than LE1,500. The age of applicants must range between 21-40 years, their monthly income should not exceed LE5,000, they cannot be beneficiaries of any similar projects in the past, and can only apply for one unit in NHP. Applicants pay LE5,000 as a downpayment and the remaining amount is paid in instalments of LE250 per month over 20 years. If any of these conditions are violated, the unit is revoked and the paid amount is not refunded. Wafaa El-Dars, a senior consultant to the Ministry of Investment's Mortgage Finance Authority (MFA), explained that the current definition of a low-income individual is one who earns a monthly income of up to LE1,000 for a single person and up to LE1,500 if married. A family that earns LE1,500 per month is categorised in the top 15 per cent income category. Accordingly, 85 per cent of families in Egypt are low-income and given the total head count of 76 million people in the last census, "half a million apartments is barely a drop in the bucket, but it is a step forward," asserted El-Dars. Building specifications limit the size of units for the most needy to 30-40 square metres; a maximum of 63 square metres in the 'Build your own house' project targeting youth and low-income families; and 100-120 square metres for the 'family home' and 'rural home' units. All units will be built on state-owned land and buildings are typically designed with four or five storeys, housing two to four units per floor with wide spaces between each building. Abdel-Hamid Shaer, media adviser to the MHUUC, said the ministry is now collaborating with private companies to develop a practical timeline because the target figure of 500,000 units in six years would not be met otherwise. This is in line with the emphasis of Prime Minister Ahmed Nazif's government on public-private partnership, noted Shaer. So far, the number of private companies willing to participate in NHP has gone up to 64, especially that the MHUUC encourages the private sector's perspective and new ideas. The top five companies building the most units are Orascom Housing Communities (OHC) with 57,200 units; Degla Corporation for Construction Investment will construct 7,200 units; Nasr City for Housing and Development 6,300 units; the Investors Association of 6 October 4,320 units; and Era for Construction Development will go for 3,708 units. Since government housing is built on state-owned land, the plots are far from the city centre which presents difficulties for home owners. This makes the units less attractive to live in, and in fact there is more than 50 per cent vacancy in the few finished housing units. Galal Sayed El-Ahl, executive director of the NHP, admitted that some ongoing developments are far from the city centre but assured that support services are also being established out there. Bus and train systems are being set up, as are other essential utilities such as water and electricity. TIBA Construction Chairman Ahmed Rashdan, however, believes that although companies might market their low-income housing projects under the claim of good intentions, the bottom line for any business is making profit. "The company has to gain somewhere," argued Rashdan, "either from the customer or the government." In fact, he expects the average low-income NHP beneficiary to be financially unprepared for what they are getting into. He described target owners of the new homes as generally uneducated who might feel privileged when they first move into a new home, but later will drown in payments, plus interest, for at least 20-25 years. "The company waves a carrot in front of the client's face to attract them into a deal," explained Rashdan. "But the houses are too small for any family with a husband, wife and maybe one child. Who can live in 50 or 60 metres? Why can't the state increase the size to 90 or 100 metres?" His scenario of what is taking place is grim: the company launches a project, takes a loan from the bank, the project fails or units remain vacant, the bank gets stuck with the bad debt, while the customer struggles to cover monthly repayments. But MHUUC paints a brighter picture. El-Ahl disagrees with Rashdan's, saying that the size of the units mainly depends on the size and nature of the family. Also, the payment schemes are designed to be affordable and flexible for all categories. "It's a community project, so you cannot put strain on the people you are trying to help," asserted El-Ahl. "The cost is divided over a certain time span, depending on what they can afford. The state's housing policy has been focussed on achieving social stability and welfare through building thousands of economy-level housing units equipped with service networks in various regions."
