Photo: USAID-provided homes in Afghanistan (Muhammad Nazem Qasemi)
The FWD #220 • 630 Words
From Crisis Response to Community Transformation
When disaster strikes abroad, the U.S. Agency for International Development’s (USAID) emergency response teams mobilize within hours. Over recent weeks, however, the Trump administration has worked a similar pace to significantly scale back the agency’s work — putting a spotlight on USAID’s core public health and relief programs. But you may not have known that the agency’s impact extends far beyond immediate crisis management, and in fact shapes how millions of families access affordable housing worldwide.
Most Americans know USAID for its dramatic emergency responses — sheltering Haitian earthquake survivors in 2010 or supporting Syrian refugees in Jordan. These critical interventions, coordinated through USAID’s Office of Foreign Disaster Assistance, have provided immediate safety to millions displaced by catastrophe.
But USAID’s most transformative housing work happens quietly, over decades rather than days. Take The Housing Guarantee program, launched in 1961. Using the U.S. government’s credit backing, this innovative initiative unlocked billions in private capital for housing development across the developing world, focusing on upgrading urban slums into affordable housing for impoverished people.
“Over the life of the program (around 40 years), The Housing Guarantee Program provided critical assistance to 30 million low income individuals in 48 countries worldwide. In addition, millions of other slum residents benefited from the training in the management of municipal facilities promoted by the program. “
Peter Kimm, Director of USAID’s Housing and Urban Programs (1966-2022)
The program’s impact in the Philippines illustrates its ingenuity. Between 1975 and 1995, USAID guarantees backed over $200 million in housing loans. These funds helped establish the Home Development Mutual Fund, known locally as the Pag-IBIG Fund. The program introduced graduated payment mortgages — starting with lower payments that increased as borrowers’ incomes grew — making homeownership possible for families traditionally excluded from the housing market.
Rather than building complete houses, many USAID-backed projects funded basic infrastructure — roads, water, electricity, and sewerage — allowing families to build homes incrementally as their resources permitted. This “sites and services” strategy was influenced by observing how people in poor urban areas were already building their own homes in informal settlements. The approach recognized that low-income families had demonstrated their ability to construct housing; what they really needed was a supportive environment with secure land rights and basic utilities. This would help attract private investment for urban housing development that served the poor.
The Housing Guarantee program’s success extended beyond the Philippines. In Indonesia, it helped establish the country’s first mortgage insurance system. In Costa Rica, program funds supported creating a secondary mortgage market. In Mongolia, the agency has helped introduce energy-efficient building standards, reducing heating costs in one of the world’s coldest capitals. In coastal Bangladesh, USAID supports developing cyclone-resistant housing designs that provide disaster-proof shelter for the population.
Early experiments in Guatemala during the 1970s pioneered what we now call housing microfinance. USAID helped local credit unions offer small, incremental home improvement loans, enabling thousands of families to gradually upgrade their homes—a model now replicated worldwide.
During the first Trump administration (2017-2021), USAID’s housing priorities saw significant shifts. The administration reduced traditional assistance programs while expanding market-based solutions through initiatives that sought to reduce US assistance and increase foreign self-sufficiency. This realignment emphasized private sector engagement over direct aid, marking a departure from previous approaches.
Several legal challenges to USAID’s current housing programs are pending in federal courts. For the latest updates on USAID and the Trump Administration, the Congressional Research Service released this report earlier this month.
Throughout its history, USAID’s housing work has demonstrated that shelter is more than four walls and a roof— it’s a foundation for health, education, and economic opportunity. As global urbanization accelerates and climate challenges mount, these lessons from six decades of housing programs remain relevant, whatever the future may hold for U.S. foreign aid.