A silver lining on the horizons

ADB’s Green and Resilient Affordable Housing Sector Project for people in the low-income brackets

If everything goes as planned, by 2027, there will be 1,000 housing units around different parts of the country, which are being constructed through the Green and Resilient Affordable Housing Sector Project, targeted to benefit people from the lower income brackets. According to the ADB, The project will increase the supply of green and resilient affordable housing in Nganglam, Trashiyangtse, Samdrup Jongkhar, Phuentsholing, Samtse, and Thimphu; and benefit about 1,000 lower- to middle-income civil servants and non-civil servants, including women-headed households and marginalized municipal waste workers.

 In 2021, the Asian Development Bank (ADB) announced that it has approved a $24 million loan and a $6 million grant to support the Government of Bhutan’s plans to improve access to adequate and affordable rental housing. The same report stated that ADB will provide an additional $1 million technical assistance (TA) grant from its Technical Assistance Special Fund to provide advisory support to the NHDCL in monitoring the uptake of housing units by target low-income groups. The TA will also promote the use of innovative construction technology and practices and develop a housing management information system for MOWHS.

The project is aligned with the following impact: livability, safety, and sustainability of human settlements ensured. The project will have the following outcome: access to green and resilient affordable housing for low-income households improved.

According to the ADB, the Green and Resilient Affordable Housing Sector Project (GRAHSP) will support the government’s national priority to improve the livability, safety, and sustainability of human settlements through better access to adequate and affordable rental housing, which will be implemented using the sector loan modality. The project will also implement the associated infrastructure and facilities, enhance the institutional capacity of the National Housing Development Corporation Limited (NHDCL), strengthen the housing sector policy and regulatory framework necessary to provide access to land, and leverage the private sector to address the housing supply shortage. The project will have the following outcome: access to green and resilient affordable housing for low-income households improved.

Meanwhile, the outputs are climate- and disaster-resilient, energy-efficient, and affordable housing units and public facilities for low-income households constructed; and Institutional capacities, policy, and regulatory framework of the housing sector strengthened.

The project will build the institutional capacity of the National Housing Development Corporation Limited (NHDCL), the government-owned enterprise responsible for providing and maintaining public housing. It will also help the Ministry of Works and Human Settlement (MOWHS) strengthen the country’s National Housing Policy. This includes reviewing housing policies and regulatory frameworks, developing climate- and disaster-resilient building designs, establishing a national homeownership strategy, and conducting awareness-raising and training activities.

Meanwhile, in an earlier report of February 2023, it was state that except for Trashiyangtse other sub-projects are at various stages of design and bid preparations. “For Rinchending and Thimphu alternative new sites are yet to be identified and safeguards studies to be carried out,” the report said. .According to the ADB’s South Asian Innovation Project Brief report, about 31% of urban households still share their accommodation with one or more other households. “Housing loans are the most common household debt. The housing gap is in part due to the country’s rapid urbanization,” the report stated.

The study from the report also found that Bhutan’s urban population has nearly doubled over the past 2 decades with 42% of the total populace living in urban areas and increasing by 2.7% annually.

According to the ADB’s report, the housing deficit in urban Bhutan continues to rise at an alarming rate where just before the COVID-19 pandemic; it was estimated at over 21,000 units nationwide, while the country has a population of about 800,000.

To reach the goals of affordable housing, the government initiated a housing program that intends to supply 2,500 affordable rental housing units to poor beneficiaries where most of the beneficiaries are low-income civil servants, municipal waste workers, single parents, people with disabilities, and single female-headed households.

The ADB’s project will not only provide homes for low-income groups and the marginalized, but will also provide three community centers, two recycling waste stations, and green spaces that help create vibrant communities.

For instance, the affordable residential buildings for Bhutan’s urban poor people will feature a modern, disaster‑resilient, and energy-efficient design that also reflect local culture and traditional architecture.

“The housing units are meant for lower- to middle-income government and private sector employees, including low-income municipal waste workers,” the report stated. Further the units are intentionally designed to reduce construction costs with rental prices that are lower than what beneficiaries are currently paying. 

Similarly, the recipients of the ADB’s initiative will spend between 16% and 29% of their income on rent. In addition, these new houses supported by the project will be on sites that offer better services and amenities, such as street lighting, sanitation, open spaces, and facilities for people with disabilities.  

Meanwhile, given the high and rising demand for affordable housing in urban Bhutan, the government prioritized it in its Twelfth Five-Year Plan 2018–2023 and National Housing Policy (NHP) in 2020.

The project has also reviewed building design practices in line with the latest scientific assessments of seismic hazards. There view showed that national building code and regulations can be significantly augmented to match the high level of risk.

The project aspires to develop the first green-certified buildings in the country. Residential buildings are designed to be cost and energy efficient and the sites are situated in subtropical climate zones and the new housing units adapt to nature in consideration of the climate.

According to the report, the walls and windows in Thimphu and Trashiyangtse were designed for thermal efficiency as they are located in temperate climate zones and the planned residential buildings in Phuentsholing, Nganglam, and Samdrup Jongkhar will have windows designed for efficient ventilation for cooling and screen protection against insects.

All buildings will be equipped with energy- and water-saving devices. They will use low-emission diode lamps to save energy and integrate rainwater harvesting, according to the report.

Meanwhile, the project is guided by the Excellence in Design for Greater Efficiency (EDGE) app which can reduce the work of the people which can reduce the use of energy, water, and embodied energy in building materials by a minimum of 20% so to bring down the beneficiaries’ monthly energy bills.

Meanwhile, Chief executive officer (CEO) of the National Housing Development Corporation Limited (NHDCL)  Rinchen Wangdi said that the ADB will support Nu 1.8bn as loan and Nu 0.45bn as grant at an interest rate of 1.5% annually with loan repayment until June 2028.

Sherab Dorjio from Thimphu