Why construct homes for those that are employed and affluent in emerging economies?

The global economic development strategy discussed previously  in this blog is beginning to gain supporters. Some of your responses to this blog have indicated that you do did not understand why the homes are constructed for the employed and affluent when it is the poor and homeless that we are trying to help. The new strategy is based on the historical fact that many existing homes for the employed and affluent in emerging economies are of a size and standard that are below what would normally be owned at their level of income or net worth.  Many people because of their current employment or personal wealth could actually afford a much larger and higher quality home if they were available. There are many who are employed that could afford a home but because of problems with  local laws and lending practices are unable to find the land for a home and a home loan at an affordable and equitable interest rate.

Because those that are employed and affluent can qualify for a loan at reasonable interest rates and have the resources international and domestic lenders can rely on them as the sources of repayment. This makes it possible to fund a number of homes which create employment in development and construction for underemployed and unemployed. In addition the "Moving up Effect" discussed in this blog also opens up housing for others to move into as the new homebuyers take occupancy and move up into their new homes.

Several inquiries have been received also about the feasibility of financing housing in emerging economies based on lending to the employed and affluent. It has been done. There is an effort underway to also insure the loans to reduce risks to lenders. See other posts for more detail.

The proposed strategy to create a global home building industry as means of creating jobs worldwide will prove to be a process that developers on several continents will explore in more detail when the first prototype community is being constructed.  Attempts to build homes in emerging countries for the homeless and the unemployed are failing much in the same way they have failed in United States. Inexpensive, small homes built as "affordable" have been not been durable and energy efficient. As a result many have deteriorated and abandoned and are no longer serviceable.