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March 10, 2015

A home of one’s own


March 10, 2015


Having a shelter of one’s own is considered a basic right. There are numerous international resolutions that recognise this. For example, the Vancouver Declaration on Human Settlements (1976) recognises adequate housing as a basic human right. But like many other rights, this one remains severely unaddressed in Pakistan.
There is an estimated shortage of a million houses in Pakistan, growing by 500,000 per year. The supply is nowhere near demand, and this gap is expected to widen further given the increase in population. Normally, this sort of situation would present an ideal opportunity for prospective investors since healthy profit would beckon (high demand is normally a good proxy for healthy profits). Yet the reality is that the major share of investment in this sector is going to off-shore destinations.
There are many reasons for this state of affairs, ranging from an adverse security situation to archaic zoning laws. Basically Pakistan’s zoning laws discourage a mixed arrangement (residential plus commercial) and are biased towards horizontal expansion. The process of land acquisition and its development is cumbersome, and the costs could be forbidding. Land grabbing mafias have a powerful hold, especially in cities like Karachi. Their political backing also implies that they can thwart any attempts by less powerful groups to enter or pursue residential construction. The few large groups that do pursue this business are well connected politically and otherwise, but only cater to the need of the wealthy and upper middle classes.
All this leaves out the lower middle class and the lower income strata. Both these classes constitute more than seventy percent of the population, and are the ones most hard pressed for shelter of their own. Given the prevalent state of affairs, their dream of having their own accommodation remains as distant as ever. The end result of government policies and laws (relative to this sector) is urban sprawls, squatter

settlements and slums. Slums and squatter settlements remain mostly unregulated, and gradually become a source of lawlessness, crime, narcotics, gang wars and poverty over time. If provision of housing had kept up with the demand, they would not have been there in the first place. In essence, their footprint in terms of problem creation is much larger than their physical presence.
So what should be done to address this critical issue? There is a new scheme in the offing – the ‘Apna Ghar’ scheme announced by the prime minister in 2013. Before it meets the same predicament as many schemes that preceded it it is important to consider alternatives to the usual way of going about this business.
There is a need to change thinking regarding urbanisation. Let’s abandon the old view that is based upon physical demarcation rather than population density, which is the widely accepted view around the globe. The importance of this change can be gauged by the fact that if we go by physical demarcation, 60 percent of Pakistan is still rural. But if we go by population density, approximately sixty percent is urban. The needs and regulations regarding urban areas are different. Labelling an urban area as rural implies denying these areas the required attention by policymakers.
Cities deserve much more attention, the major reason being the fact that cities are the engines of growth. Keeping in line with global trends, a major portion of Pakistan’s GDP growth also comes from its cities. And it is in cities where we see the major manifestation of housing shortages. The relative scarcity (and affordability) of land, the ever increasing percentage of population becoming a part of cities, and the potential of attracting investment in this area are some other reasons why finding affordable means of shelter should be concentrated on the cities.
Focus should shift from horizontal expansion to vertical expansion. There is lesser need for coming up with new housing schemes that only add to the existing sprawls. The need is for vertical expansion, and the ideal scenario in this case would be to utilise the large, unoccupied swathes of land in cities. A city like Islamabad has innumerable number of these. In other cities (like Karachi and Lahore), where such spaces may be relatively difficult to find, the already existing horizontal constructions could be optimised. In addition to occupying lesser space, vertical buildings have proven to be more efficient in terms of efficient use of resources like water and electricity.
The government has a critical role to play in all this. It’s much easier for the government to acquire land and make it available for construction (government usually acquires the land on book value rather than market value). Moreover, it can come up with a set of rules and regulations governing housing construction. But that is where its role should end and the role of the private sector should start. Development of land, construction and maintenance should be left to the private sector. Experience tells us that this would be ideal since if the government was good at addressing this issue, we would not have such a deficiency of housing in the first place.
It is extremely important for every tier of government to work for reducing the considerable transaction costs in the housing sector. They come in the form of costs associated with acquisition and development of land, dispute resolution, legal lacunae, difficulties in entitlement, simplification of procedures for registration, etc. They will go a long way in attracting investment in this sector.
There is an urgent need to arrest the development of slums. Over time, they become a hub of lawlessness, black market activity, gangs and drugs.
New construction should not just be about quality; it is imperative that the quality aspect figure in as well. There’s no use building a house that needs repairs within a short span of time. Moreover, the environmental impact aspect should also be addressed.
Government plans should not be reflected in official papers only; they should be practically implemented. I gave the example of the scheme announced by the PM in 2013. Till this day, it is only limited to paperwork despite Rs20 billion being earmarked in the budget for it.
The above stated proposals are by no means exhaustive; they are rather generalisations of the main proposals. Ideally, any such scheme should take into consideration other countries’ experience too. The examples of LIHTC in America, or Khuda ki Basti schemes in Pakistan, should be kept in mind in the pursuit of affordable housing for all.
Housing is not merely about shelter, it also affects culture, poverty, wealth accumulation and generation of opportunities. It’s up to our policymakers to decide how they would like all this to peter out in the future.
The writer is a researcher and has taught at Bahria University and Iqra University.
Email: [email protected]




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