The Arial Foundation has built 25 homes for poor families in Ensenada, Mexico over the last two years by using new building techniques with their Arial Home Initiative. The homes are made from strong, lightweight galvanized steel panels which fit together like LEGO’s.

In June, 2007, the first step was to rent a 3,600 sf warehouse in Ensenada to turn it into a factory for manufacturing the structural panels. All materials are purchased locally, including steel, windows, doors, toilets, etc. The Arial Foundation hired four local workers who are capable of producing 40 panels per day, enough to build one Arial Home. The steel sheets are injected with polyurethane foam to make highly insulated panels. Wall panels are 8 feet high and 4 feet wide, and the shiny white (to reflect the sun’s heat) roof panels are identical but they are 9.5 feet long and 4 feet wide.

A 380 square foot colored concrete pad is poured on the home site in advance. When the concrete dries, the home can be erected by the family members and a few friends in one day. The only tool required is an electric screw gun. Since the homes are made from steel they will not burn down in a fire, they will not rot, they will not allow mold to form, they will resist damage far better than drywall, and they will last as long as 50 years with minimal maintenance.

A unique feature of the Arial Home design is that it includes indoor plumbing complete with kitchen sink, toilet and shower. The homes can by powered by a solar panel and a battery where electricity is not available. A deep, lined pit is dug to dispose of human waste in a sanitary manner.

 

Economies of Scale

Arial Homes are designed for mass production, similar to how cars are manufactured. The lowest possible cost per home could be achieved if 96 Arial Homes could be built in a community at one time. This would require approximately 6 – 7 acres, including land reserved for a school and a soccer field.

By starting with a vacant lot, a single bulldozer and backhoe could level the site, raise up the dirt for the concrete pad locations and dig the sanitary pits for all 96 homes within a few weeks. All of the concrete pads could be poured within that same timeframe. Each group of 8 families could construct their homes within one week. The 12 "neighborhoods" would be finished in 12 weeks after the site preparation work was complete.

 

Financials

We anticipate that with the economies of mass production and site preparation, each Arial Home could be offered for $9,500. We hope that suitable land can be found that will result in a cost of $500 for a 10 meter square lot, for a total mortgage amount of $10,000.

The family’s down payment would be the "sweat equity" that they invest to assemble the Arial Home components into their new home. With the adults from all 8 families helping out, each home can be finished in about four hours.

We propose that a local Mexican bank provide the equivalent of a one million dollar loan at current mortgage rates in Mexico. This loan would be guaranteed by the Arial Foundation, so there would be no risk to the bank in terms of repayment. The one million loan would be drawn down as costs are incurred. The extra interest costs, prior to the home owners’ move into their homes would be covered by mortgage payments that exceed the interest rate paid to the bank.

A small fee for basic home maintenance, life insurance and major disability insurance would also be built into the mortgage amount paid by each family.

The principles of microfinance as learned by Grameen Bank and Muhammad Yunus would be applied to collect the weekly, cash mortgage payments from "responsibility groups" of eight families. Each home owner would pay $35 per week and the group’s leader would pay the bank representative $280 per week when he comes to the community office to collect the mortgage money.

The mortgage term would be 15 years.