AMMAN // The apartment Heyam Ayyash and her husband, Faeq, hope to qualify for is small, between 80 square metres and 113 sq m. But it is the only home they are ever likely to own. The flat is for their eldest son, Mohammed, 22, who Mrs Ayyash would like to see married this year or next. "I would like Mohammed to start his marriage with an apartment that he owns instead of renting a place," said Mrs Ayyash, who has five other children.
The Ayyash family, like thousands of others in Jordan, has applied for a new apartment under a royal initiative, "Decent housing for decent living", launched last year. It is designed to provide 100,000 homes to low-income citizens. For those earning between US$450 and US$1,400 (Dh1,600 to Dh5,100) a month, there is the option of a newly built apartment at a low interest rate and with no deposit required. Other plans would allow for the purchase of small plots of land where the beneficiary, with a $7,500 grant from the government, could build a house.
The Ayyash family applied in April last year to the Housing and Urban Development Corporation (HUDC), the government body in charge of housing, and are still waiting to hear back. If they are accepted, they will be eligible to buy a subsidised apartment, the market value of which starts at $50,000, for only $33,000. Affordable housing has been an unattainable dream for many Jordanians, where 14.7 per cent live below a poverty line of less than $800 a year, but the royal initiative, the first of its kind in the country, is trying to make that dream come true.
Mr Ayyash and his son Mohammed bring in $650 a month together as drivers. That means the family qualifies for an apartment, but they are still wary of the sacrifice it will entail - paying up to half of their salary to the bank. "But that's the only way we can buy an apartment," Mrs Ayyash said. The initiative comes as demand for housing is increasing in a country where population growth stands at 2.3 per cent. In the capital, Amman, 1.3 million new housing units will be needed by 2025, according to the city's master plan.
It also comes as the Landlord and Tenants Law is expected to take effect next year, which allows landlords to ask for higher rents. In the past, rents were capped for tenants who remained in the same house. Since the royal initiative was announced by King Abdullah in February 2008, the HUDC has received 210,000 applications, 82,000 of which qualify for the scheme, according to corporation officials.
But last year only a few hundred were able to benefit from the initiative because banks, in the midst of the financial crisis, became reluctant to lend. This prompted the government to take new measures in April to make buying a home more affordable still. These include raising the maximum age of beneficiaries to 70 from 60, extending the repayment period of loans to 25 years from 20 and allowing the loans to cover up to 100 per cent of the cost of the house provided the monthly repayment is 50 per cent of the beneficiary's monthly salary.
The government will also shoulder five per cent of the interest rate. "The corporation seeks to empower thousands of citizens from different income brackets who applied to the initiative with appropriate housing," said Sana Mehyar, the director of the HUDC, adding that efforts were under way to finalise some 9,000 applicants who had qualified for a home under the scheme. The HUDC has announced the names of 5,450 beneficiaries since the beginning of this year.
Despite the government's efforts to make housing more accessible, the initiative has not been without its challenges. From a cultural perspective, planners realised that many impoverished people who live outside Amman prefer to have their own houses instead of an apartment because they are conservative and do not feel comfortable living in a building with neighbours so close. The size of the apartments has also emerged as an issue. Many thought they were too small and did not like that they were not close to shops and services.
Some economists had also raised concerns that beneficiaries would not be able to pay back their loans. From a social perspective, lumping low-income Jordanians together in certain areas could create ghettos that might stigmatise anyone living there, said Yusuf Mansur, an economist and consultant at Envision Consulting Group. "The whole theme of having ghettos is not acceptable in Jordan for the poor and lower income. It doesn't help social mobility either."
Also, poor and lower-income families tended to have larger families and need more space, he said. "Therefore, the government should have studied their needs first." Economically speaking, he said, the government, already struggling with a 10-per-cent budget deficit, does not have the money to run these major projects. "We are a country where the government does not have much flexibility in its fiscal policy. It has little money to spend on major projects ? What would have been better from the start is to increase liquidity in the market to increase the ability of [low-income] citizens to borrow."