Housing policy in developing countries

Guenter Karl

Chapter 6 in Papers presented during the Narodowy Bank Polski Workshop: Recent trends in the real estate market and its analysis, 2013, 2013, pp 137-149 from Narodowy Bank Polski

Abstract: The paper first presents employer-provided housing applied to the Kibera-Soweto slum upgrading project in Nairobi. The widespread existence of slums in developing countries is not a new phenomenon in economic and social history. At the end of the 19th century in England where the industrial revolution started and at the beginning of the 20th century in continental Europe, housing and general living conditions of workers were unbearable. The living conditions of workers and their families gave rise to powerful political movements, including revolutions. The trade unions and the social-democratic political movement were the main driving force for the gradual improvement of the living conditions of workers and their families. Further, the paper gives brief remarks on housing problems in developing countries. The prevalence and extent of slums in urban areas of many developing countries constitute the most serious housing problem in these countries. This phenomenon has of course also considerable health, social and political implications. “Housing” in slums is a separate market which is only loosly connected to the established official housing market. Governments in developing countries must directly intervene and deal decisively with the slum problem by devising slum upgrading policies. It also must play a key role in the provision of suitable land and contribute to the financing of new buildings, including so-called decanting sites. Finally, the paper asks why does housing receive so little attention in national development and finds that countries are foreign exchange constraint, housing is not embedded in the national vision and there is a dominance of export-led growth strategies. To answer the housing problems the paper presents potential solutions. First, the country should develop a vision and a strategy, to solve the housing problem. Necessary points are the revision of the legal system to ensure legal security and predictability and the formation of a multistakeholder group and experts to develop the specific set of incentives. This actions should be in line with the content of the UN-Habitat Governing Council Resolution 21/7.

Date: 2013
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