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A new paradigm for affordable housing

About the author


Syed Hassan has a background in the corporate, public and non-profit sectors and specializes in sourcing finance for development projects that directly impact and improving the socio-economic conditions for developing countries through partnership with developed countries. He has been involved in several multi-stakeholders efforts in a number of developing countries and international development agencies in energy health, education, climate change, economics and social development. His current focus is on initiating a multi-stakeholder initiative which aims at the implementation of affordable social housing approaches. Previously he spent several years in the Middle East where he worked on behalf of a local ruling family as Managing Director of two companies, one specializing in energy sector project development. He was instrumental in forming the strategy and arranging financing for a 1260MW power project which was at the time, the largest independent power project in the world, backed and initiated by the World Bank. During this time Syed served as Advisor and Consultant to the World Bank and the Agency for International Development. Syed has also worked extensively as senior executive in the shipping industry and international trading. During the course of his career he has worked across the world, living in over ten countries and travelling to over eighty countries. He has an in-depth understanding and knowledge of the business and global geopolitics. He is passionate about supporting efforts to secure a sustainable energy future and specialises in theory and practice of Decentralized Energy and Climate Change issues.

Social Housing is one of the biggest problems of our times.

Peter Marcuse(1) is without doubt one of the most eloquent and logical scholar of our time who has understood and explained ways and means to overcome the dilemma of Affordable Housing for all.

This article is mainly based on his writings and perfect guidelines for governments, civil societies, public/private sector and all concerned to resolve the housing problems for the poor segment of our society.

Housing is one of the most important sectors of the economy- in developing countries as in rich ones- with large positive externalities in terms of economic growth, public health and social stability’ It is the primary form of asset accumulation for the poor — often representing more than 50 percent of the assets of household. However housing systems in developing countries are dominated by badly designed, poorly targeted, and inefficient government subsidies, market failures in land

Markets, overwhelming informality, are dominance of powerful vested interests and a growing slum population. Indeed Bertrand Renaud (formerly of the World Bank) has stated that “very few major sectors of the economy have been so much plagued by unjustifiable amateurism in public policy as housing in developing countries.

After more than a century of social welfare programs featuring housing in most developed countries, and after decades of declarations and the setting of ambitious housing goals by international agencies and the United Nations, the Housing problem for the poor is getting worse. We need today a radical back-to-basics review of the housing situation, what explains it, and what can be done about it.

Are these problems new?, no, but in two major aspects, yes.

Fundamentally, they exist because of acombination of two factors. The first is aneconomic system that, with all its virtues, results in a very uneven distribution of wealth, leaving many with inadequate incomes to pay for the necessities of life at their actual costs of production.Worldwide, the richest one percent has as much income as the poorest 57 percent. Incomeinequality has been growing, not declining, for at least the last 20 years. The second factor is the marketization of housing, which means a housing industry and a housing system geared to meet the needs and preferencesof those willing and able to pay the most, anduninterested in the needs of those unable to payeven the least, not compensated for by the very limited role of government in meeting thosehousing needs that the provision of housingthrough a profit-driven market cannot supply.

There does not seem to be any significant possibility of altering either of these factors in the foreseeable future, but let us not forget that these are the reasons why we have the problems we do.

However today these problems can be solved.

That might have been questioned in earlier years. It can’t be questioned today. Over the large course of human history, aggregate resources, aggregate wealth, even if evenly distributed, would not have been adequate to meet what we would todayconsider the standards of adequate housing for all.

That is no longer true — we have the material resources, the technological knowledge, and thecapacity to house all of the world’s population adequately. The challenge today is a social, economic, and political one, not a material one orone of lack of knowledge.

Everyone has the right to a standard of living adequate for the health and well-being of himself and his family, including food, clothing, housing, and medical care and necessary social services, and the right to security in the event ofunemployment, sickness, disability, widowhood, old age or other lack of livelihood in circumstances beyond his control.

The need for governmental action is clear. From a ‘global perspective’, the simple fact is that nowhere in the world are the poor able to pay for decent housing on the private housing market. And our governments are not willing, or do not wish, to face that simple fact. Why?

Several barriers stand in the way of adequate governmental action. First is the lack of governmental resources. This has to do with priorities, both as to revenues (i.e., levels of taxation) and expenditures (i.e. distribution of benefits), which will vary from country to country, and should influence the pace, but not the direction, of government actions.

Second is apolitical/ideological opposition to government action, which is based partly on a blanket rejection of prior state socialist actions and Cold Warpsychology, and partly on a faith in markets that ignore the concerns of non-market participants.

For instance, the main argument of the World Bank’s Shelter Policy is that distortions of markets, often well intended, create most of the shelterrelated problems low-income families face.

But that ignores completely issues of poverty and the social costs of pure market provision.

A third barrier is uncontrolled and inefficient market conditions that increase the cost of housing unnecessarily, including sprawl, speculation, segregation, and complex and inefficient financing systems.

Fourth is the dissatisfaction with the manner in which state housing provision was accomplished in the past — large-scale, impersonal, ugly, restrictive, and unresponsive. But alternate means of provision and management are available.

A fifth obstacle is the power of those profiting from a housing shortage who oppose redistributive measures necessary to deal with it, which would inevitably be at their expense. All of these are matters of government policy. They can and need to be resolved through democratic political processes. But to resolve them takes courage and power, and the willingness to face the controversies and conflicts that changing government policies require. The quest for consensus, sometimes suggested as central to the role of planners and social policy advocates, is adead end here. Consensus is a mirage, in an area so fraught with conflicts of interests focus on immediate needs, to deal with the complex programs that do exist, inadequate as they are, to spend our time today dealing with the complex requirements to finance a limited number of partially subsidized housing units. Further, because we are dependent on government agencies and individuals and often politicians to obtain even the help we can get, we are reluctantto confront them to criticize, to call for change, for fear of losing that little assistance that we can get.

The temptation is to polish expertise, to become technicians, to focus on the fine print and let the big questions go, to master the game and its present rules, to push for refinements and amendments, not to address basics. But housing advocacy is not a technical job, although technicians are needed in day-to-day efforts to achieve at least some small results in the present defensive era.

The dependency only on governments to do something is not working. In the face of these pressures, those concerned about housing for the ill-housed need to get back to basics and consider some simple and basic points about the kinds of actions and policies that are necessary to tackle seriously the overall problems of housing. Perhaps those who are on the front lines of housing provision day-to-day cannot raise these issues strategically, but at least those of us who are privileged to have secured financial and academic positions, or are involved inresearch and social work, can and should, come up with new ideas that are practical, financially viable and achievable.

Under present economic system, the people at the bottom of the pyramid who most need the social housing can never afford it.

Today we need a radical review of the prevailing approach to the social housing problem globally.

Social Housing has a potential 100 billion Dollar market.

With modern technology, financial engineering, wiser land use, better policies, we can turn this in to a very profitable business that shall create millions of affordable housing for the poor.


A research by Azra Jabeen, Huang Xi Sheng and Muhammad AAmir) of School of Law, Chongqing University, 400044 China have undertaken an extensive research on ‘Housing Crises in Pakistan:

The research offers an insight in the housing crisis in Pakistan and offers few possible solutions.Within South East Asia Pakistan has one of the highest shortages of social and affordable housing.

The advanced technologies in agricultural sector and rapid industrialization cause massive rural-urban migration in Pakistan. Today , the level of urbanization has reached almost 38.2, while there were 23.2 million houses in the country as against the population of approximately 198 million. Pakistan is facing shortage of 10 million residential houses, which is growing with the ratio of 600,000 annually. Pakistan is still in its infancy when compared with other developing and developed countries. Although the country has plethora of laws and policies to strengthen the housing sector, yet there are still many legal loopholes and gapes in effective implementation and improvement of housing sector in Pakistan.

Housing is considered one of the most basic human rights and an essential component of the right to an adequate standard of living. Adequate and affordable housing is not only necessary for security and comfort, but is also critical in fostering social cohesion and development of a nation. The housing sector plays a major role in economic growth and stabilization through the creation of job in construction and materials and demand for financial services. The housing and construction industry has the potential of absorbing a large number of skilled and unskilled workforce, significantly mitigating unemployment and, thereby, reducing poverty in the country.

Housing construction activity and productivity has been rising in Pakistan in recent years from very low level; still housing sector is in its infancy when compared with other developing and developed countries. At 1% of the GDP however, there’s tremendous potential for growth, given a relatively stable and growing economy, a rapidly increasing population, unmet housing demand, and a growing awareness of housing finance options. As the Pakistan economic development improves, the demand for housing, industrial, commercial, and service facilities will also increase. Nevertheless, there remain serious issues in the housing sector value chain and land market that require attention, because the very high land prices, high and rising real interest rates and prices of construction materials threaten the growth achieved.

Though the housing is a basic and fundamental human need, yet millions are caught in the struggle to have a roof over their head in Pakistan.

The housing sector, despite of its importance and recognition, remained neglected in Pakistan and has not been able to attract even a modest allocation of public sector resources.

Of the total population of almost 200 million the urban population in Pakistan constitutes about 38.2%, and is increasing at a rate of 2.6% per year.

Pakistan urgently needs a radical review of the current approach to the social housing situation in Pakistan. We need to find new ways to create enough resources to enable building houses for the poor.

Pakistan offers golden opportunity for the development of affordable housing.

Along with global experts, we haveproposed a solution that is viable, fundable and guarantees construction of affordable housing at mass scale.

— Pakistan has great demand for affordable housing

— Contrary to general impression there is ample land available at affordable prices for large scale sustainable social housing

— The technological advancement means Pakistan can build ‘social housing at a very low cost compared to current construction cost in Pakistan.’

– Pakistan compared to India and may other developing countries has not been able to access concessionary financing for housing from International Development Financial Institutions(DFIs).These funds run in to several billion dollars. A well planned viable project with professional due diligence, good management and backing from federal and provincial governments and local civic bodies shall be able get the necessary funding.

The social housing can be equally profitable for investors with good Return on Investment (ROI) and houses at affordable rate to the poor. The initial requirement is a 30% equity which could be either full cash or a combination of cash and land.

Military can be one of the potent forces in developing social housing. They have land, hard core management cadre, access to finance and well experienced in housing projects. They are the driving force in helping the elitist class with fancy lavish living for the upper class from the land of the people. It is about time they did for the poor masses of Pakistan what they have done for the rich. There must be a world of comfortable living for the general masses other side of sprawling Defence Housing Complexes around the country.

In forging ahead Pakistan needs to build low-income social housing subsidizing the construction with the profits from high income housing. In this context we have complete plans that have been approved by the global housing experts and if anyone in the private sector/ government/Military or other social bodies be interested, we have a team of experts to make necessary presentation.

We, the Global Group, are a development organizationfocused on empowering those who have the least.

We work primarily as a catalyst to find resources, support organization both from public and privatesector, for social causes globally, trying to make adifference in the lives of the individuals/communities at the bottom and lower middle of the pyramid. The leadership of the global Group consists of people who have been in ‘both worlds.’ We haveworked within Fortune 500 corporations and in the global ghettos. We’ve managed university departments andserved women and children at risk in Southeast Asia. We’ve consulted for global corporations, managed complex supply chains, done consumer product development, developed social housingmodels round the globe and yet our passions come alive when we’re serving the poor be it inLatin America, Europe, Asia, or Africa.

The Pakistan Social Housing initiatives are led by concerned Pakistani professionals living overseas and in Pakistan with support from global experts and organizations.

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