On Feb. 12, 2023, Catalina Velasco, Colombia’s housing minister, announced changes to the government’s Mi Casa Ya program, set to take effect in 2024. These modifications aim to help impoverished Colombians purchase their first home. By prioritizing the most vulnerable families, Mi Casa Ya could address homelessness while building generational wealth in Colombia. More than 6.8 million people suffered internal displacement during the country’s 52-year civil war, leading to an extreme housing crisis and a national poverty rate of 28%. The Colombian Ministry of Housing, City and Territory (MVCT) first implemented Mi Casa Ya in 2015 to tackle this housing crisis.

Background and Expansion of Mi Casa Ya

Mi Casa Ya is a government assistance program that serves to aid low-income families with the purchase of their first property by granting housing subsidies. Originally, Mi Casa Ya only served in three cities: Barranquilla, Bogota and Cali. However, under the Petro administration, the MVCT announced that starting in 2024, the program would expand nationwide and prioritize the country’s most vulnerable populations, particularly the homeless. 

Eligibility and Benefits of the Program

To qualify for Mi Casa Ya, the applicant must meet the following criteria. First, the applicant must not own a home in Colombia. Second, they must not have previously received any sort of housing subsidiary. Third, the applicant must have been approved for a mortgage credit. Finally, they must be registered in the Sisbén IV, the System of Identification of Potential Beneficiaries of Social Programs, which classifies Colombian citizens based on their socioeconomic status. 

Sisbén IV separates individuals into four groups: A (extreme poverty), B (moderate poverty), C (vulnerable population) and D (nonpoor, nonvulnerable). An applicant’s ranking in the Sisbén IV determines how much monetary assistance they will receive with the most economically vulnerable granted the highest amount of financial aid. 

Once deemed eligible for the Mi Casa Ya grant, the applicant receives a downpayment subsidy that varies anywhere between 26 million COP and 39 million COP, roughly $6,000 to $10,000. To reduce monthly payments, during the first seven years, Mi Casa Ya grantees will also obtain interest rate coverage of their mortgage credit.

Impact and Importance of Housing Wealth

Since its inception in 2015, the MVCT has allocated 50,000 Mi Casa Ya subsidies annually. This initiative aims to provide the impoverished with the opportunity to own homes and build generational wealth in Colombia. About 90% of the recipients fall under the Sisbén IV categories of extreme poverty, moderate poverty and vulnerable populations.

According to a 2004 study by the U.S. Department of Housing and Urban Development’s Office of Policy Development and Research, low-income families significantly increase their wealth accumulation after purchasing a home. For the impoverished, “housing wealth is total wealth,” meaning it constitutes their entire net worth. Thus, by expanding homeownership opportunities, governments not only tackle poverty and homelessness but also boost generational wealth for their most vulnerable citizens.

Looking Ahead

The expansion of Colombia’s Mi Casa Ya program marks a promising step toward addressing long-standing housing disparities. By focusing on the country’s most vulnerable populations, this initiative is set to empower countless families through homeownership, fostering stability and economic advancement. As the program rolls out nationwide, there are hopeful expectations for the housing crisis resolution and the creation of more generational wealth in Colombia.

– Naima Rasheed

Naima is based in New York, NY, USA and focuses on Good News for The Borgen Project.

Photo: Flickr