Challenges of Urban Housing

The Indian population living in slums has risen from 27.9m in 1981 to 61.8m in 2001. By 2030, it is estimated that 70% of Indian jobs will be in cities and it is projected that 590m Indians will live in slums.

A research paper, “Working with the Market: A New Approach to Reducing Urban Slums in India” goes into the details of soaring land prices and slum populations. The paper also suggests some corrective measures. The paper points out that faulty government policies are responsible for these filthy living conditions of the urban poor. If the policies were upgraded as per the migration rate, this situation could have been avoided. At the current pace, it would take 23 years to house Mumbai’s current slum population with no provisions for new slum dwellers. 

Policy reform is a must. The central government must initiate affordable housing projects in major cities, development of infrastructure to increase effective land supply, intensive use of urban land and basic housing for the poor at the very first go.

The reason for high (unaffordable) price of housing in the market lies in:-   

(i) High land prices,  

(ii) Cost of construction  

(iii) Transaction cost  

(iv) Taxes & legal charges, and  

(v) Profit margins of private operators.