Demand-Driven Housing Subsidies, Household Welfare and Labor Markets: Causal Evidence from Colombia’s Mi Casa Ya

Colombia faces a substantial housing deficit and unequal access to basic public services, both in quantity and quality. In 2021, 31% of households were experiencing housing deficits, a condition that disproportionately affects vulnerable households and women. Mi Casa Ya (MCY) is Colombia’s flagship demand-side housing subsidy program, designed to reduce housing deficits by facilitating access to urban social housing for low-income households. This study presents a causal evaluation of the impact of MCY on household welfare, including housing conditions, access to public services, residential safety, labor market outcomes, income, poverty, and vulnerability. Using administrative records and household survey data for applicants, beneficiaries, and non-beneficiaries, the results show that MCY reduces barriers to homeownership and contributes to significant reductions in both quantitative and qualitative housing deficits. Beneficiaries also gain access to more formal housing conditions, improved public services, and safer residential environments. The program improves labor market outcomes, including employment, earnings, and formality, with particularly strong benefits for women. In addition, MCY reduces dependence on other government assistance programs, increases household expenditure, improves access to durable goods and financial products, and lowers the likelihood of poverty and vulnerability. A cost-benefit analysis confirms that the program generates substantial positive private and social returns.