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Ammon News - AMMONNEWS - Housing developers are considering a proposal by the authorities and the UN Human Settlements Programme (UN-Habitat) to build apartments for lower middle income Jordanians.

A study by UN-Habitat on the housing sector in the Kingdom found that there are no entry-level housing options for lower middle income Jordanians and that rented housing is increasingly becoming less affordable for this segment.

The study, a copy of which was e-mailed to The Jordan Times, said the “rental problem has been severely exacerbated by the influx of Syrian refugees”.

With the shortage of affordable housing estimated at over 120,000 units, UN-Habitat and the government plan to implement a predominantly private sector funded solution called the Jordan Affordable Housing Programme.

The programme combines the credit capacity of Jordanian families interested in making an incremental investment in property, financing from local commercial and Islamic banks and the available resources of local developers and their construction capacity.

Jordan Housing Developers Association (JHDA) President Kamal Awamleh told The Jordan Times the programme would deliver up to 30,000 affordable apartments over three years, targeting households whose monthly income ranges between JD300 and JD500.

The housing projects would be implemented by Jordanian developers, Awamleh said, adding that the price of land in areas surrounding cities is feasible to implement such ventures.

According to the JHDA president, rents in Amman went up by nearly 100 per cent over the past few years due to the influx of Syrians, while in the northern region they increased by over 200 per cent.

He said the proposed scheme aims to enable the delivery of smaller-sized affordable housing units (60-65 square metres), designed so that they can be expanded or combined to 120-130 sq. m. apartments in the future.

The target price for these units is JD15,000 inclusive of land, making them affordable to households earning above JD300 per month.

This represents a significant percentage of the population living outside central Amman, with the programme being operational in all governorates except for the capital, where land prices are too high to achieve a JD15,000 unit price, Awamleh added.

“A recent survey has confirmed that there is very strong demand for affordable housing, and that both the price and the size of this proposed housing unit would be very acceptable to our target market, initially households earning between JD300-JD500 per month,” UN-Habitat said.

Banks are prepared to provide the needed financing for this target group, and can offer a 10-year repayment period for 80 per cent, and potentially up to 100 per cent, of the purchase price, at market interest rates, currently between 7.5 per cent and 8 per cent.

The repayment amount for a JD12,500 loan, whether from a commercial or Islamic bank, would be about JD150 a month, the study said, adding that average rents outside Amman are currently around JD150 per month.

While there is no set or prescribed house design, the ideas generated by the National Design Competition will be available for developers to use or base their own designs upon, UN-Habitat said, indicating that examples of some of these houses will also be constructed in four or five locations to demonstrate the options and possibilities to prospective purchasers and families.

According to the UN-Habitat surveys, more than 70 per cent of all households said they would find small, 65sq.m. houses acceptable, particularly if they were affordable and extendable.

Explaining how “half houses” could be turned into “full houses”, the report said the units may be physically extended — upwards or sideways — or expanded by connecting and combining adjacent half-houses, adding that households will be informed and assisted in their decision-making processes so that they make appropriate decisions regarding their choice of house design and acquisition strategies.

*Agencies