Exploring alternative housing policies for urban Ecuador : an implementation of the housing quality model

This paper explains the use of the HQM for Ecuador"s two major urban areas - Quito and Guayaquil. Key decisions are described regarding the scope of HQM implementation for Ecuador, as well as necessary modifications to HQM data requirements and logic. The paper then documents HQM data sets constructed to date, providing extensive details about data sources, assumptions, and methods. Results are presented of five alternative policy scenarios, each of which is simulated for both of the cities under three possible economic environments. The scenarios include: (1) maintaining currently scheduled programs (base case), (2) improving urban water service, (3) enhancing access to formal financing, (4) expanding the involvement of savings and loan institutions in housing finance, and (5) addressing the housing needs of low-income renters. The simulations indicate that the single most effective initiative would be to reduce the cost of serviced land in Quito and Guayaquil and to substantially increase the rate at which water connections are extended to occupied dwellings. This policy, in combination with the base case program, has the potential to increase in the short term the share of urban households who live in fully adequate housing. The report concludes by summarizing key areas for future analysis in regard to information gathering and policy intervention.