No place to stay: ‘Home ownership a pipe dream for the urban poor’

Expert suggests rental housing as a solution to escalating problem.

KARACHI:

The urban poor face a desperate situation as the country’s housing crisis spirals out of control. With little government or institutional support of loans, lease or land allotment, their struggle to own their home continues.

This was part of the findings of a survey, titled ‘An overview of the present housing crisis in Pakistan and a way forward’, prepared and presented by Prof. Dr  Noman Ahmad, the chairman of the faculty of Architecture and Planning, NED University, at the Urban Resource Centre on Wednesday.

Population growth, rural-to-urban and urban-to-urban migration, reconstruction and repair of existing units and the changing nature of family units were identified as the main factors that create the need for and shortfall of housing units. The pre-flood total urban housing requirement was estimated at 2.7 million units.  The population growth rate is around 2.6 per cent, while it is 4.7 per cent for urban areas. Limitations of land, infrastructure and resources add to the bleak scenario.

He highlighted that those from low-income groups can rarely buy land. Even when they do become homeowners, they are located at the city’s periphery. “Rental housing can help provide some relief. The government can subsidise construction that will cut costs of contractors, which will also lessen rent,” Dr Ahmad suggested. Other recommendations included regulatory mechanism to fix price and the revival of the House Building Finance Corporation (HBFC) - a source of soft loans.

Community-based housing was also identified as a possible solution.

Historical overview

Dr Ahmad’s presentation also provided an historical snapshot of the problem, identifying its genesis and mapping its evolution. The Ministry of Rehabilitation was set up to solve the refugee problem at the time of Independence as Karachi faced a mass influx of refugees. As it became the nation’s capital from a small coastal town, its population jumped from 400,000 to over 1.1 million within the first four years of the country’s inception.

From 1955 to 1965, the government allocated 10 per cent of public spending to housing, as it constructed entire refugee colonies and gave out units at soft loans. However, shortfall in payments made it unmanageable and squatter settlements were the result of this policy failure.

For the next 20 years, the government tolerated katchi abadis as its spending shrank, Dr Ahmad added. By the third five-year plan, the government sought the help of the private sector for housing, providing tax incentives to builders.

Dr Ahmad informed the audience that from 1970 to 1988, the government only provided land, as it realised that construction was extremely capital-intensive. The HBFC was set up to provide financing to homeowners, while the KDA handled land development, he said.

During the time of seventh five-year plan , an important development was the introduction of land reforms. But it wasn’t until the introduction of the National Housing Policy in 2002 that the extent of the problem was acknowledged.

Published in The Express Tribune, May 26^th, 2011.