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CAN THE GLOBAL HOUSING PROBLEM BE SOLVED?
What is the housing need?

According to the UN Habitat 30% of the world’s urban population lives in slums, deplorable conditions where people suffer from one or more of the following basic deficiencies in their housing: lack of access to improved water; lack of access to improved sewage facilities (not even an outhouse); living in overcrowded conditions; living in buildings that are structurally unsound; or living in a situation with no security of tenure (that is, without legal rights to be where they are, as renters or as owners).

35% of the world’s rural population lives in unacceptable conditions.

Overall more than 2 Billion people are in desperate need of better housing.

In this poor housing people face many unmet needs. For example many are living in overcrowded conditions with inadequate living space. According to the World Bank & UN-Habitat Housing Indicators Program2, people in high income countries, such as Spain, have more than 4 times as much space per person as people in low income countries. (The differential with the U.S. is even higher.)

2. Housing Indicators Program. 1994 The Global Survey of Housing Indicators - 1990. Final survey results. Unpublished. Joint Program of the World Bank and the U.N. Centre for Human Settlements (Habitat). Washington, D.C: World Bank. Cited in “Housing Policy Matters, A Global Analysis”, Shlomo Angel, Oxford University Press. 2000.

These people don’t have much space, but what they have is often of poor quality. How big is the difference in quality? And what would it take to bring that housing up to our standards? The Housing Indicators Program attempted to assign a dollar value to housing based on the amount and quality of housing provided. This is not the market value, but a reflection of the amenity provided. Housing in high income countries had 36 times the value, based on quality, of housing in low income countries.

What kind of housing would these people like to have? And what would it cost to provide it? What would it cost to meet their demand? The global housing need includes people with modest housing deficiencies as well as those with the severe deficiencies of the slums. We might consider it reasonable that people aspire to a housing quality similar to that in Spain or parts of Europe, which is less than in the US but about average for the high income countries (US housing has 5.2 times the hedonic value/person of the average for high income countries3). The cost of giving everyone the same value house as in high income countries would be on the order of $211,000 billion.

3.Housing Indicators Program. ..... Cited in “Housing Policy Matter..” p.370 Table A23. $225K/person in U.S. vs 43K for all high income countries.= 5.2 times

The Problem is

BIG

 I don’t want to worry too much or put too much emphasis on the detail of these statistics. Rather I want to summarize them by saying the problem is “big”.
The need is big. The demand is big. The opportunity is big. As a business person looking at this need, I’m reminded of Henry Kaiser’s ready mix cement trucks which had Kaiser’s motto plastered on the side: “Find a need and fill it.” (To which my mind always added “with concrete”)

 

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