i

STRATEGIES FOR AFFORDABLE HOUSING

(Case Study of Murree City)

By

Viqas Amir

(NUST201261475MSCEE15813S)

A Thesis submitted in partial fulfillment of

the requirements for the degree of

Master of Science

in

Urban & Regional Planning

DEPARTMENT OF URBAN & REGIONAL PLANNING

NATIONAL INSTITUTE OF TRANSPORTATION

SCHOOL OF CIVIL AND ENVIRONMENTAL ENGINEERING

NATIONAL UNIVERSITY OF SCIENCES AND TECHNOLOGY

SECTOR H-12, ISLAMABAD, PAKISTAN

(2015)

ii

This is to certify that the

thesis entitled

Strategies for Affordable Housing

(Case Study of Murree City)

Submitted by

Viqas Amir

has been accepted towards the partial fulfillment of the requirements for

Master of Science

in

Urban & Regional Planning

Dr. Abdul Waheed

DEPARTMENT OF URBAN & REGIONAL PLANNING

NATIONAL INSTITUTE OF TRANSPORTATION

NATIONAL UNIVERSITY OF SCIENCES AND TECHNOLOGY, ISLAMABAD

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ACKNOWLEDGEMENTS

First of all I am thankful to Almighty Allah, Who helped me to write & complete that

research thesis titled "Strategies for Affordable Housing, A case study of Murree City"

I would like to extend my thanks to the NUST-NIT_URP Deptt faculty Dr. Naeem Asghar

(Head of Deptt), Professor Dr. Abdul Waheed (Research Supervisor) & Professor Imtiaz

Ahmad Vohra for their continuous support.

My sincere obligation to my respected thesis advisor Dr. Abdul Waheed for his precious

pieces of advice and facilitation in preparing my research thesis and providing a platform

to come-up with innovative ideas and after deep analysis, summing them up into useful

outcome.

Particular appreciations are due for all professionals and experts who assisted me in the

groundwork of research. I extend my cheers to my all friends and colleagues, fellows, who

sacrificed their time for the congregation of research work.

I am exceedingly indebted to my mother and family who always prayed for my success in

the completion of my research.

Viqas Amir

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DEDICATION

I dedicate this research work to my Parents, who always wished & prayed for

my success and encouraged me to upgrade & share my knowledge/ideas.

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TABLE OF CONTENTS

ACKNOWLEDGEMENTS ............................................................................................. iii

DEDICATION .................................................................................................................. iv

TABLE OF CONTENTS .................................................................................................. v

List of tables ....................................................................................................................... x

List of Figures .................................................................................................................. xii

List of Abbreviations ..................................................................................................... xiv

ABSTRACT .................................................................................................................... xvi

Chapter 1 INTRODUCTION ..................................................................................... 1

1.1 Research Problem .............................................................................................. 2

1.2 Purpose/Motivation for Study .......................................................................... 3

1.3 Benefits of Study ................................................................................................ 4

1.4 Research Objectives .......................................................................................... 5

1.5 Research Questions ........................................................................................... 5

1.6 Scope of Study/Research ................................................................................... 5

1.7 Research/Thesis Organization .......................................................................... 5

Chapter 2 LITERATURE REVIEW ....................................................................... 7

2.1 Introduction ....................................................................................................... 7

2.2 Urban Growth .................................................................................................... 8

2.3 Housing ............................................................................................................. 10

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2.4 Affordable Housing ......................................................................................... 13

2.4.1 Concept & Definition ........................................................................................ 15

2.4.2 Dimensions & Challenges of Affordable Housing ............................................ 18

2.4.3 Need for Affordable Housing ............................................................................ 18

2.4.4 Planning Tools & Affordable Housing .............................................................. 20

2.4.5 Socio-Economic Determinants and Affordable Housing .................................. 23

2.5 Access To Affordable Land. ........................................................................... 30

2.6 Affordable Building/Construction Materials ................................................ 35

2.7 Access To Affordable Housing Finance ......................................................... 38

2.8 Housing Situation in Pakistan ........................................................................ 41

2.8.1 Housing .............................................................................................................. 44

2.8.2 Urban Land ........................................................................................................ 48

2.8.3 National Housing Policy-2001 .......................................................................... 49

2.8.4 Affordable Housing in Pakistan ........................................................................ 52

2.8.5 Low Income Housing Initiatives In Pakistan .................................................... 55

Chapter 3 RESEARCH METHODOLOGY ....................................................... 58

3.1 Study Population ............................................................................................. 58

3.2 Research Design ............................................................................................... 58

3.3 Data Collection ................................................................................................. 58

3.3.1 Primary Data Collection .................................................................................... 59

3.3.2 Sampling Procedure ........................................................................................... 62

3.4 Data Processing/Analysis ................................................................................ 63

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Chapter 4 DATA COLLECTION & ANALYSIS ....................................................... 64

4.1 Murree City ...................................................................................................... 64

4.1.1 Population and Major residential Areas of Murree ........................................... 65

4.2 Residential Areas Survey ................................................................................ 66

4.3 Housing Demand and Supply in Murree City .............................................. 67

4.4 Social Aspects ................................................................................................... 68

4.4.1 Socio-Economic Status of Households ............................................................. 68

4.4.2 Employment Status ............................................................................................ 69

4.4.3 Ownership Status ............................................................................................... 69

4.4.4 Plot/Unit Size ..................................................................................................... 70

4.4.5 Respondent's choice of Ownership status.......................................................... 71

4.4.6 Respondent's choice of Shelter Type ................................................................. 71

4.4.7 Proximity/Accessibility to Various Facilities .................................................... 71

4.4.8 Age of Buildings/Units ...................................................................................... 73

4.4.9 Dwelling Type & Condition .............................................................................. 74

4.4.10 Repair of Houses/Units & Reasons ............................................................. 74

4.5 Economic Aspects ............................................................................................ 75

4.5.1 Household's Average Income; ........................................................................... 75

4.5.2 Non-Housing Expenses; .................................................................................... 76

4.5.3 Rent of the Unit/House ...................................................................................... 78

4.5.4 Market rate of the Unit/House ........................................................................... 78

4.6 Housing Finance/Loan .................................................................................... 79

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4.6.1 Problems in Availing the finance ...................................................................... 80

4.6.2 Willingness/Need for Housing Finance ............................................................. 81

4.6.3 Required Amount of Housing Finance .............................................................. 81

4.6.4 Repayment Affordable Amount ........................................................................ 82

4.7 Institutional Aspects ........................................................................................ 83

4.7.1 Household Satisfaction over Building Materials/Technical assistance ............. 83

4.7.2 Causes for Lack of affordable Housing Units ................................................... 83

4.7.3 Causes for less-Affordable/High Unit Rent ...................................................... 84

4.8 SWOT Analysis for Promoting the Affordable Housing Units ................... 85

4.9 Correlation Analysis of Affordability with other Variables ........................ 90

4.10 Need Assessment of Households for Affordable Housing ............................ 97

4.11 Public Satisfaction Survey/Analysis ............................................................. 100

4.11.1 Public Satisfaction over the Performance of Housing Departments ......... 100

4.11.2 Public Satisfaction Over Housing Facilities ............................................. 102

4.11.3 Public Satisfaction over Quality of Housing Facilities (Infrastructure/

Structure) ......................................................................................................... 103

4.12 Economic Dimensions of Housing ................................................................ 105

4.13 Affordable Housing Challenges .................................................................... 107

4.14 Framework for Provision of Affordable Housing in Murree .................... 109

Chapter 5 CONCLUSIONS & RECOMMENDATIONS ............................. 112

5.1 Conclusions .................................................................................................... 112

5.2 Recommendations .......................................................................................... 116

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REFERENCES .............................................................................................................. 120

ANNEXURE .................................................................................................................. 128

ANNEXURE-I Indicators and variables list ................................................................... 128

ANNEXURE-II Questionnaire for Household Survey ................................................... 130

ANNEXURE-III Stakeholder Interview form ................................................................ 135

ANNEXURE-IV Map of Murree City Showing Residential Areas ............................... 138

ANNEXURE-V Landuse map of Murree City ............................................................... 139

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LIST OF TABLES

Table 2.1: Global number of people, in billions ................................................................... 8

Table 2.2 - Pakistan's Population, Urban Population and Poverty ...................................... 43

Table 2.3: Main characteristics/indicators of Housing for Pakistan and Punjab ............... 47

Table 4.1: Locality (Major Residential Areas of Murree Urban) ....................................... 66

Table 4.2: Population and Housing Units-Murree City ...................................................... 67

Table 4.3: Socio-Economic Status of the Households ........................................................ 68

Table 4.4: Household Size .................................................................................................. 69

Table 4.5: Employment Status ............................................................................................ 69

Table 4.6: Ownership Status ............................................................................................... 70

Table 4.7: Size of Plot/flat (In Sq.ft) ................................................................................... 70

Table 4.8: Preference Of Ownership Status ........................................................................ 71

Table 4.9: Preferred Shelter Type ....................................................................................... 71

Table 4.10: Average Distance Travelled to avail the facilities(In Kms)............................. 72

Table 4.11: Average Age of Building (In Years) ................................................................ 73

Table 4.12: Reasons for Repair &Maintenance of Units .................................................... 74

Table 4.13: Household's average Monthly Income (In Rupees) ......................................... 75

Table 4.14: Non-Housing Expenses (Average Monthly In Thousand Rupees) .................. 77

Table 4.15: Rent Paid by the Respondents (Annual in thousand Rupees) .......................... 78

Table 4.16: Land Cost in various Residential areas of Murree ........................................... 79

Table 4.17: Problems For Availing/ Not Availing The Finance Facility ............................ 80

Table 4.18: Households Needing Housing Finance ............................................................ 81

Table 4.19: Repayment Amount affordable for Respondents ............................................. 82

Table 4.20: Satisfaction on Building materials/ Technical assistance ................................ 83

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Table 4.21: Causes making housing un-affordable in Murree ............................................ 84

Table 4.22: Causes for High Housing Rent in Murree ....................................................... 84

Table 4.23: SWOT Analysis for Promoting Affordable Housing in Murree ...................... 85

Table 4.24: Correlation of Housing Affordability with Other Variables ............................ 92

Table 4.25: Need assessment for Affordable Housing ....................................................... 98

Table 4.26: Descriptive Summary of Satisfaction Level over the Performance of Housing

Departments among the Respondents ............................................................................... 101

Table 4.27: Descriptive Summary of Satisfaction Level over the Housing ...................... 102

Table 4.28: Descriptive Summary of Satisfaction Level over the Quality of

Infrastructure/Structural Facilities among the Respondents ............................................. 103

Table 4.29: Standard Deviation & Mean Of Affordable Housing Variables (Economic)

........................................................................................................................................... 105

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LIST OF FIGURES

Figure 3.1: Research Methodology ..................................................................................... 60

Figure 3.2: Murree city with location of residential areas .................................................. 62

Figure 4.1: % Age of respondents/Samples from Residential Areas of Murree ................. 66

Figure 4.2: Trends in Household size ................................................................................. 69

Figure 4.3: %Age of Respondents with Employment Status .............................................. 69

Figure 4.4: %Age of Respondents with Ownership Status ................................................. 70

Figure 4.5: % of Respondents living in plot/unit with Size /Area ...................................... 70

Figure 4.6: % of respondent's willing for house/unit on ownership/ rental basis ............... 71

Figure 4.7: % of respondent's willing for house/unit on ownership/ rental basis ............... 71

Figure 4.8: Average distance travelled by the household to avail various facilities ........... 72

Figure 4.9: Average Age of buildings in different localities .............................................. 73

Figure 4.10: % Age of dwellings with Type & Condition .................................................. 74

Figure 4.11: Reasons for repair/maintainance of units ....................................................... 74

Figure 4.12: Household's Average monthly income ........................................................... 75

Figure 4.13: Average Monthly Non-Housing Expenses by Households ............................ 77

Figure 4.14: Average Annual Unit Rent in thousand Rupees ............................................. 78

Figure 4.15: Average Unit/House Cost in thousand Rupees............................................... 79

Figure 4.16: Problems faced by Households in accessing Finance .................................... 80

Figure 4.17: Households need House finance ..................................................................... 81

Figure 4.18: Finance required by Households for construction/improvement of unit ........ 82

Figure 4.19: Repayment Installment affordable for the respondents .................................. 82

Figure 4.20: Satisfaction over Building Materials/ Technical Assistance .......................... 83

Figure 4.21: Causes for Un-Affordable housing in Murree ................................................ 84

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Figure 4.22: Causes for High Unit Rent ............................................................................. 84

Figure 4.23: Need Assessment of the Households for Affordable Housing ....................... 99

Figure 4.24: Satisfaction level of the respondents over Housing and Allied Deptts ........ 101

Figure 4.25: Satisfaction level of the respondents over Housing facilities ....................... 102

Figure 4.26: Satisfaction level over Quality of Infrastructure facilities........................... 104

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LIST OF ABBREVIATIONS

NUST National University of Sciences & Technology

TMA Tehsil Municipal Administration

UNEP United nations Environment Programme

UNDP United Nations Development Programme

UNESCO United Nations Educational, Scientific Organization

UN-Habitat United Nations habitat Organization

GOP Government of Pakistan

CDA Capital Development Authority

RDA Rawalpindi Development Authority

PHA Pakistan Housing Authority

HBFC House Building Finance Corporation/Company

SBP State Bank of Pakistan

ADB Asian Development Bank

WB World Bank

PHATA Punjab Housing & Town Planning Agency

LDA Lahore Development Authority

ERRA Earthquake Rehabilitation and Resettlement Authority

MIT Murree Improvement Trust

MDG Millennium Development Goals

PLDC Punjab Land development Company

FGEHF Federal Government Employees Housing Foundation

PGSHF Punjab Government servants Housing Foundation

NRMP National Reference Manual on Planning and Infrastructure Standards

UNCHS United nations Center for Human Settlements

SPSS Statistical Package for social sciences

SWOT Strengths, Weaknesses, Opportunities and threats

STD Standard Deviation

EIA Environment Impact Assessment

RWH Rainwater Harvesting

xv

STP Sewerage Treatment Plant

Govt. Government

GOP Government of Pakistan

OPF Overseas Pakistanis Foundation

DHA Defense Housing Authority

CDA Capital Development Authority

FDA Faisalabad Development Authority

KDA Karachi Development Authority

HRCP Human Rights Commission of Pakistan

CWHR Council for Works and Housing Research

MTDF Medium Term Development Framework

KPK Khyber Pakhtoonkhawa

OGDC Oil & Gas Development Corporation

PAEC Pakistan Atomic Energy Commission

OPP Orangi Pilot Project

HDA Hyderabad Development Authority

CDG City District Government

EU European Union

US United States

OECD Organization for economic cooperation & Development

Sq.ft/Sft Square Foot

mm Millimeters

m Meters

Km Kilometer

Rs. Rupees

xvi

ABSTRACT

Globally affordable housing provision is a major challenge for the Govts, particularly in

the developing countries. Population growth and urbanization are key factors behind the

growing demand for affordable housing. Pakistan having 191.71million population is

facing acute housing shortage of about 09million units with annual demand of 0.7million

units with growing housing supply-demand gap. The housing deficit for low income

households is about 4.5 million units, with annual addition of 150000 units. Most of the

housing projects developed by private developers meant for higher profits and targets

higher & higher middle income groups.

Murree city has been selected as case study. The data was collected through primary

sources by household questionnaire and stakeholder's interviews, while secondary data

was collected through public deptts., reports, journal articles etc. The data analysis was

done using SPSS software and correlation test was applied. SWOT analysis and need

assessment was carried out for the provision of affordable housing.

The present population of Murree is 28500 persons and housing units are 3000, with

housing deficit of 1700 units. Most of the households are living in overcrowded, low

quality housing conditions, with small size units, higher household size, low education

levels and substandard infrastructure facilities. The data analysis on economic variables

revealed that, most of the respondents are unable to save for upgrading and construction of

their units with low income levels. The land and unit cost is too high for them to afford.

The correlation analysis indicates that affordability has highly significant relationship with

socioeconomic variables i.e, plot/unit size, plot/unit cost, and distance to job. Moreover

household size, income level, and non-housing expenses also has significant correlation

with other variables involved in analysis that affect the affordability levels.

xvii

As per the public satisfaction survey analysis, the households have expressed their extreme

dissatisfaction over the poor performance of housing, building, land and finance

department. The respondents have expressed average satisfaction over the housing

facilities, including location, unit size, and accessibility to facilities but highly dissatisfied

over the cost of unit/building materials. Survey analysis also show that shortage of

affordable housing & high rent is mainly attributed to lack of initiatives from the Govt,

excessive land cost and tourist influx, ban on construction.

In SWOT analysis, by managing weaknesses & threats, the barriers to affordable housing

could be managed. The need assessment of the households depicts that majority of the

respondents need an affordable housing unit, with low price plot/unit, housing finance

with flexible terms, and proximity to facilities. Poor housing policies, ineffective landuse

&building regulations, low income levels, higher land & construction cost, ban on

construction in Murree, speculation, lack of access to housing finance are the major

challenges for shortage of affordable housing. The land registration &titling system is

poor, with cumbersome procedures.

On the basis of data analysis, literature review and stakeholder's interview, to address the

major challenges, a framework was developed for the provision of affordable housing. It

has been recommended that the proposed framework to be adopted for developing

affordable housing. Land registration/titling system to be computerized, managing

speculation by regulations and made accessible to poor. Housing finance system to be

made efficient with flexible terms. Landuse & building standards to be upgraded with

incentives to the private developers and building industry for low-cost units and materials.

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Chapter 1

INTRODUCTION

Purpose of this chapter is to highlight the factors that lead to the selection of research

topic. Then the objectives and research questions have been defined on which the research

will be based. Moreover it includes the benefits of the research study and the chapters that

will be part of the thesis.

Pakistan was facing housing deficit of more than 7.57 million units in 2009 (UNHabitat-

Pakistan-2008-09, WB, 2009) with an annual additional requirement of 270,000 units

(GOP-Housing Policy-2001; Population Census, 1998), which has raised to 09 million

units in 2015 (GOP, 2015).

To own a house is the right of every human being with adequate facilities, it is becoming

hard for lower and middle income group to construct his house within his/her income. As

the Plot’s prices are beyond their reach, and the cost of building materials/construction is

rising day by day. The housing construction and the development of housing projects are

carried out either by Government departments or private developers. The standard and

quality of these housing facilities are below standards and without adequate access to

amenities/facilities. The Poor community's average monthly income and expenditures for

food, clothing etc, reduces the chance of any savings in income and cost required to

acquire a plot/shelter remains a dream for this class. The per capita income is 1512$

presently (GOP, 2015). The result is the current housing crisis faced by common people in

Pakistan.

The Government has not been able to develop and deliver healthy and affordable housing

that is accessible to moderate to low income people. Most of the housing projects

2

developed by the Government for poor (Plots/housing units) are eventually taken away by

some influential groups with the mutual cooperation, creating more problems for the poor

homeless. The provision of affordable housing has become a serious challenge for the

Government, with increasing poverty for almost 21% of the population (UNDP-Pakistan)

& due to rapid urbanization. The problems further aggravated with housing policies

targeting the upper income and high middle income community.

In urban areas, with minimum affordable housing options, the poor has to live in slums

and katchi abadies, as no practical measures have been adopted for provision of affordable

housing targeting the low income households. Urban & peri-urban areas are major source

of employment, Workforce prefers to live near workplace, where the housing cost is too

high, both rental and ownership basis, including high density residential apartments and

row housing. It encourages the poor households to look for housing at peri-urban

areas/outskirts.

1.1 RESEARCH PROBLEM

Access to affordable housing is the major issue in urban areas of Pakistan. Pakistan is

facing acute shortage of adequate & affordable housing. Slums and katchi abadies are the

results of affordable housing shortage. Lack of adequate & affordable housing is the main

cause of slums & environmental problems. Affordable housing including access to

affordable land, building materials and housing finance, is not being considered at design

stages nor in policies lacking public participation and inefficient regulations. It requires

proper formulation of strategies for the provision of affordable housing to cope with the

rising demand and to reduce the creation of slums/katchi abadis in order to achieve the

resident's well being/satisfaction.

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1.2 PURPOSE/MOTIVATION FOR STUDY

The following factors have forced me to take up that research study in the field of

affordable Housing;

• Population, Urbanization & Slums:- Population of Pakistan is increasing annually

and now is about 191.71million (GOP, 2015). Perhaps the urban population is increasing

at alarming rate and putting pressure on urban infrastructure and housing which is already

in deteriorating condition. Urbanization in Pakistan is continuous since independence,

people move from rural to urban areas for work/jobs and better living, but over there,

they could not find the adequate/affordable shelter and are forced to live in illegal

settlements/slums, which lack basic facilities and amenities.

Affordable /Adequate Housing:- It is the right and wish of every household to find

affordable access to housing. Unfortunately there are many housing projects launched

every year, but affordable housing is rarely planned at a cost poor can afford, with

accessibility to amenities and services. Further whether all the income groups are getting

the access to adequate facilities or not is equally a serious issue.

Land, Housing Finance and Materials:- Affordable access to land for the poor is a

dream. It results in illegal occupation and katchi abadies, which create environmental

issues and socio-economic problems for the poor. Lack of access to affordable housing

finance pushes the poor to live in vulnerable areas and construct housing on illegal lands

with substandard materials. Security of tenure is critical for improving the housing

conditions of the low income households. Affordable access to land; finance and

appropriate materials can upgrade the living standards and safety of the middle to low

income households.

Community Satisfaction: - Neighborhood and housing facilities that are developed for

the community who will live there, if lack community satisfaction, then its purpose is just

4

money making and not the wellbeing and comfort of the community. It is required to

assess whether the future and present neighborhood facilities meet the needs of the

community. It will be advantageous for the communities to share and access all the

amenities, required for affordable housing development.

Planning Standards/Regulations & Strategies: - Planning standards and regulations are

formulated to develop adequate & affordable housing facilities accessible to lower

income households and provide comfort & convenience to the residents with all the

amenities. Presently the planning standards are not upgraded and comprehensive to meet

the affordable housing & neighborhood needs and neither are enforced & followed in

adequate manner. Furthermore there are no strategies for affordable housing with

particular reference to Murree.

Infrastructure/Amenities: - Most of the housing projects are being developed with

substandard quality of infrastructure and lack of amenities i.e., education and health

facilities. Even those targeting the high income population face such problems. The

projects for low income or lower middle income are facing acute issues of accessible

amenities and quality infrastructure. While the cost of all facilities is borne by the

households and investors take all the profits/privileges.

1.3 BENEFITS OF STUDY

The major benefits of the study and its findings will be ;

• A tool for Policy makers and Professionals in making future Plans.

• Access to affordable Land could be increased.

• Reduction in slums and Katchi Abadies & homelessness.

• Improved access to Affordable Housing finance.

• Creation of jobs and increasing economic activity.

5

• Healthy living environment and resident's well-being & satisfaction is ensured.

• Planning standards and its improvement/enforcement could be identified

• The level of amenities and services will be accessible and satisfactory for all

the income groups.

1.4 RESEARCH OBJECTIVES

1. To explore the socio-economic determinants of affordable housing.

2. To identify the gap between supply and demand of housing in Murree.

3. To explore the household satisfaction in provision of affordable Housing

4. To work out the framework for provision of affordable Housing.

1.5 RESEARCH QUESTIONS

1. What are the current housing situations in Murree relating to;

a) Access to affordable land.

b) Access to affordable building materials.

c) Access to Housing finance.

2. What is the current situation about the demand and supply of housing units in

Murree?

3. How the ‘affordability’ is integrated in existing and proposed housing provisions?

1.6 SCOPE OF STUDY/RESEARCH

The study is focused on public housing, (For community residents).

1.7 RESEARCH/THESIS ORGANIZATION

Chapter one provides general introduction of the affordable housing issues, then

motivation for research study is explained, with research objectives and research questions

6

listed for conduct of research. Capter-02 presents the literature review in the light of the

research study topic and research objectives. Chapter-03 is the research methodology as

how the research will be done, selecting the study design, sampling procedure, sample

size, selection of instrument for data collection and data analysis techniques and

references. It is about the data collection and its procedure with sampling and Instrument

defined. Both primary and secondary sources data collection will be collected and

described in that chapter. Chapter-04 includes the data analysis based on collection and

using the software for data analysis. Chapter 05 includes the conclusions and

recommendations about the research study. At the end, bibliography or references for

research study are provided.

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Chapter 2

LITRATURE REVIEW

Purpose of this chapter is to highlight the housing issues and the main causes behind huge

housing deficit especially for the lower income households. Firstly the urban growth levels

at international and Asia level briefed. Then the demand and supply of housing and steps

taken by various developing countries explained. Next is the affordable housing provision

and its concepts & definition as described by UN & various research scholars has been

elaborated with need of affordable housing and how the planning tools can help achieve

that objective. In the next section, access to affordable land, building materials & housing

finance for the moderate to low income households has been described. Then Pakistan's

housing issues and affordable housing provision briefly discussed. In the next section

housing in the study area Murree has been briefed.

2.1 INTRODUCTION

Cities are facing enormous environmental, housing and poverty issues and degradation of

infrastructure due to rapid population growth and urbanization. Lack of adequate housing

and haphazard development give rise to slums and squatter settlements. The provision of

low cost and affordable sustainable housing is not as per standards and requirements. The

historical gap between the rich and the poor communities can be identified by the living

conditions and housing standards. The Planned developments of gated neighborhoods with

adjoining slums or haphazard development provides the comparison. The use of urban

planning tools is important to plan healthy and environment friendly cities and towns

which are productive, sustainable, affordable and provide healthy living environment,

safety, security, employment and business opportunities. In many cities of the developing

8

countries the planning systems and policies do not provide housing at affordable and

adequate manner that have not met the needs of the poor communities and other urban

residents in an adequate manner (UNHabitat-2010).

2.2 URBAN GROWTH

In recent decades due to rapid urban population growth and urbanization, one of the

significant features for growing cities is urban sprawl. Where large chunk of urban land is

occupied and is associated with other problems of high car ownership rate, low density,

and inefficient Land use (UNHabitat,2013). The urban population will keep on increasing

at a faster rate in developing world, and the Governments at all levels are facing the

challenging task of shelter provision. At the world level, the urban residents are 3.3

billion, just over 50% of the world total population. As per UN about 05 billion people

(about 60% of the world population) will be living in cities. By 2050, the urban population

will be 5.3 billion (Bredenord, Lindert,2010).

The urban population growth is on decline in highly developed countries. The annual

addition is two million in Europe. In major cities of developing nations, including Dhaka

(Bangladesh), Lagos (Nigeria), Karachi (Pakistan), Kinshasa (Congo), New Delhi &

Mumbai (India), the total annual population rise is more than Europe's whole population.

Table 2.1: Global number of people, in billions

1990 2000 2012 In absolute poverty: living on less than US$(PPP)1.25 per day 1.95 1.78 1.17 Slum dwellers 0.67 0.78 0.87 Urban residents 2.28 2.86 3.63 Population of Least developed countries 0.51 0.66 0.88 World population 5.3 6.1 7.1

UN-Global Sustainable Development Report(2014)

Asia's urban population is half of the world urban population. Asia has the seven most

populous cities out of 10 at world level. Asia has two meta-cities (higher than 20million

9

population), Delhi and Shanghai. While it is expected that three more cities of Asia i.e.,

Mumbai, Dhaka, Beijing will be meta-cities by 2020 (UN-Habitat, 2013).

The Buildings are the source of providing work place, recreational and business space, and

shelter to every humankind, and are part of our social and economic life. Buildings are

also source of environmental degradation and global climate change, as it uses major share

of global energy. Affordable & sustainable buildings and housing provide a solution in

reducing the energy consumption, resource use, water use and overall economy with long

life of the building. The largest housing market is in the developing countries. Due to high

Population growth rate, and rapid urbanization, the demand for housing units increases as

compared to supply, which raises the housing prices and affects the most lower income

communities who are already suffering the most and homeless. To cope with the shortage

of housing the authorities have initiated vast affordable housing Projects in mega cities

such as Bangkok, Beijing, Ho Chi Minh City, Johannesburg, Manila and São Paulo

(UNEP-Sushi, 2013).

Urbanization is the rural to urban shift of people for the purpose of employment and better

living standards, where most of them could not find adequate shelter and live in

slums/katchi abadis. Slums are without the access to basic facilities like, safe drinking

water and adequate sanitation, apart from access to education & health facilities.

Urbanization also put significant pressure on already built environment including

infrastructure & Housing and give rise to overcrowding, environmental and housing

problems. Lack of affordable & adequate housing is also giving rise to slums &

unhygienic living conditions, which affects the human well being. Urbanization in

developing countries is 2 to 3 times higher than in developed countries. Slums and

informal settlements have higher urbanization trend in urban area of developing nations.

Every third urban resident is living in slums. Sustainable affordable housing will have to

10

be promoted to minimize climate change globally and improve the residents well being. It

is expected that 90% of the slum resident population will be living in inadequate housing

at the end of MDG's target 2020. Governments are required to upgrade slums and their

housing conditions in sustainable and affordable way (UN-Habitat, 2012).

2.3 HOUSING

"Housing is generally defined to embrace both shelter and the basic infrastructure for

urban services which urban residents need" (Choguill, 1994). 10% of the Global GDP and

07% Jobs are related to housing sector (Wallbaum, Salzer, 2012). Housing as" adequate

shelter for all" is recognized as a vital human right in the Universal declaration of human

rights and endorsed at 1996 UN-Habitat conference, related to vital living standards,

housing, food, health care and clothing (United Nations, 1948-Article-25; Zuo, Wilson,

2009 ;Choguill, 2007;GOP Housing Policy, 2001). The MDG-7 (Millennium Development

Goals) aims to create ‘cities without slums’ with a target to accomplish ‘considerable

progress in the lives of at least 100 million slum inhabitants, (Target-11) by the year 2020’

with Indicator 32: Proportion of people with access to secure tenure; (UN-Habitat, 2003;

Choguill, 2007; Sengupta, 2010)

The provision of housing to the urban poor is the most challenging issue for Governments

in developing world. In Asia, Africa, & Latin America, most of the countries are dealing

with huge housing shortages both in quantity & quality (Bredenord & Lindert, 2010).

About 2.8 billion people without adequate shelter will require decent housing by 2030. To

tackle the increased housing demand of households, in next 20 years, about 877 million

housing units are required (UN-Habitat-2006; Bredenord & Lindert, 2010). It means huge

housing production with land, materials and finance is required, which is a challenge for

the developing world (Bredenord & Lindert, 2010). In developing countries most of the

11

poor are living in inadequate housing conditions. Few mega cities in developing world are

facing challenging issues of slums, due to rapid growth of slums (Sengupta, 2010). In

Asian cities, each year, there is an addition of about 44 million due to urbanization, It

equals to an addition of 120000 people per day in urban population. Which means about

20000 new dwellings per day are needed (UN-Habitat, 2011).

The Asia’s urban population is 50.3% of total World urban population. Eight out of ten

fastest growing cities are in Asia (1950-2000) i.e. Tokyo, Mumbai, Delhi, Dhaka, Jakarta,

Karachi, Kolkata, Seoul. In Asia, land and housing faced significant pressure due to urban

growth in cities. In the developing world, Asia has over half of the total slums. 61% of the

population in Asia lives in slums (UN-Habitat, 2011). For maximum financial gains,

housing development in private sector is preferably planned for higher income group that

results in poor demand & supply match, i.e. in Bangladesh there is surplus of housing for

upper income group, and huge shortage in supply of affordable housing. Furthermore the

upper-class purchases such housing for investment and rental purpose. As a result 1/3rd of

housing is developed informally. In Asia middle and upper income households try to get

/own housing in gated communities usually financed by private developers, which is not in

access of most of the lower income group, Which gives rise to slums, squatter settlements

and informal housing, low quality housing in most cities of Asia (UN-Habitat, 2011). In

South Asia there is significant housing deficit of 38 million units, excluding housing unit

requiring repair, while south central Asian Countries facing huge housing deficit will

include homeless and housing with deteriorated conditions. It is estimated that housing

deficient has increased from 400000 to 650000 units between 2000 to 2010 in Srilanka,

while in Bangladesh the current housing shortage is 660000 units. In 2001 there was urban

housing shortage of 7.1 million units. Indonesia requires 73500 new housing per year and

Malaysia needed 709400 new housing units up to 2010 (UN-Habitat, 2011).

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In many Asian countries housing shortage is both in quality and quantity. The fast

urbanization has caused shortage of housing and dilapidated condition of housing.

Polluted water and poor sanitation, poor quality/inadequate and overcrowded housing in

densely populated cities are the main causes of poor health, affecting largely the well

being of millions of populations residing in such conditions. Housing plays a pivotal role

in reducing poverty and socioeconomic development. By providing the access to

affordable and adequate housing, it reduces the diseases, environmental degradation,

increases the national and household income. Over the past few decades, countries have

shifted their approach to providing accessible, adequate & affordable housing in National

policies, strategies and legislative framework (UN-Habitat, 2011). In Bangladesh

Government has initiated programs for rural landless and homeless to reduce migration

from rural bangle to urban areas and offering employment opportunities as motivation

measure to urban slum residents to shift to their native villages. In Malaysia many housing

development programs have shared to addition in housing construction. In Srilanka

national housing development authority has initiated the one million housing programs to

raise housing & to own homes with subsidized loans. In 1994 due to scarcity of land, the

focus shifted from slum up-grading to re-locate in high density apartments (UN-Habitat,

2011; Bredenord & Lindert, 2010). As per UN-Habitat "slums are defined with five

measureable indicators at household level, known as shelter deficiency. About four

indicators determine physical lexis of slum situation, non-durable housing construction,

lack of water& sanitation, and overcrowding. The fifth indicator the tenure security has to

do with validity. Housing that is recognized by one or more of the above shelter deficiency

is supposed to be in-adequate(UN-Habitat&UNESCAP,2008;UN-Habitat,2011; Bredenord

& Lindert, 2010; Gandhi, 2012). In most Asian cities, a common trend is to re-locate the

slum dwellers in multistory flats block at the peri-urban area/periphery. As the only option

13

to achieve proper urban area densities, to compare the local planning regulation is to have

multi-storey apartment (UN-Habitat, 2011).

Housing Policies:- Earlier research explained that the major factors which may affect the

future Housing Policies and its implementation will be; a) Urban Growth,

(b)Improvements in housing Policies (c) readjustment of National economies (d)

Sustainability (e) Availability of external resources (Choguill, 1994; Islam, 1996). The

major policy areas which need to be addressed for sustainable & affordable housing policy

development are; (a) Community participation (b) Access to materials (c) Building

standards (d) Housing finance (e) Land (Choguill, 1994 & 2007; Islam, 1996).

Adequate housing was recognized in 1948 (universal declaration) & 1966 (International

convention) as the right to an adequate living standard. The minimum requirement for

adequate housing is: Tenure security, accessibility of materials, facilities & infrastructure,

affordability, habitability, accessibility & location.(UN-Habitat, 2009; Bonnefoy, 2007).

2.4 AFFORDABLE HOUSING

Affordable housing demand has increased at the international level and it is assumed that

it will keep on the same pace of growth. Further it is considered that private developers

have less interest in the sector of affordable housing. As such, there are several

opportunities for development put forward by the affordable housing sector with many

barriers to tackle with (Wallbaum & Salzer, 2012). In the developing countries with rapid

urban growth, the Governments are to tackle two issues, upgrading the housing quality in

existing slums & squatter settlements and provision of land & housing to the homeless at

affordable cost (Bredenord & Lindert, 2010).

Most of the Government's primary focus is on resolving the housing issues of middle

14

income group, while neglecting the dominant low to lowest income families. In the

developing world, the demand and supply gap is higher for affordable housing. The

Governments must concentrate on resolving the challenging issues of adequate &

affordable housing shortage (Bredenord & Lindert, 2010). Financed self help housing is

the most affordable and smart mode of providing sustainable housing (UN-Habitat-2005)

which is practical, inexpensive, flexible and useful (Bredenord& Lindert, 2010; Sengupta,

2010; Afshar, 1992). As incremental self help/owner built housing has been recommended

by many authors as a useful way of achieving affordability in housing provision. In it if

the poor or low income households have the facility of financial assistance and minimum

standards, then the households can better manage the construction/improvement of their

housing as per their changing needs, time, available resources, savings/income and its

location, priorities/desires in use of designs, skills/techniques of their own choice. As most

of them keep on spending on housing improvement/additions, incrementally throughout

their lifecycle (Bredenord & Lindert, 2010; Sengupta, 2010; Afshar, 1992). In most of the

developing world & Asian countries, the major issue is the access to affordable and

adequate housing. Partly the housing is expensive due to income are too low and partly

where income is higher, housing supply and finance is less than required. Due to the lack

of availability of quality and affordable housing people have no choice than to live in

slums and informal settlements. The low income community spends most of their income

on housing as compared to other basic necessities of daily life i.e. food, education and

health (UN-Habitat, 2011). Through policies Singapore, Chile and Hong Kong have

successfully provided access to adequate housing to cope the issue of slums and affordable

housing. The participation of low income group in housing provision was ensured through

policy framework. Here large scale high density apartment's complexes were

implemented. In Asian cities urbanization has put housing affordability in Stress (UN-

15

Habitat, 2011; Mitlin, 2010; Bredenord & Lindert, 2010). Supply of affordable housing is

much lower as compared to urban growth in most of the Asia countries. The growth of

slums and informal settlement is mainly attributed to affordable housing deficit in Asia.

About 21% of population live in slums in Bangladesh, and 50% population live in slums

in Pakistan. As per UN-Habitat the major cause of Asia’s growing slums is the poor access

to decent, secure and affordable land (UN-Habitat, 2011).

One of the important aspects related to the development and socio-economic stability of a

country is housing affordability. Housing affordability intends to make certain that

housing provided to every income household (low, middle &high income) is affordable.

Malaysian Government in its 10th Plan has a target of 78000 affordable housing

constructions. Various policies were formulated and implemented for providing affordable

housing to low income groups (Suhaidab & Basria, 2011). In Srilanka, there are a lot of

projects to enhance affordable housing quality and its access to the poor including three

major programs. First is sustainable township plan in Colombo that is self financing

voluntary re-housing, in which slum dwellers willingly leave their unit/land and re-located

in multistory flats. Second is special housing project for poorest. In it, housing finance on

soft term to be provided to poor for improving the housing. Affordable housing for

plantation worker with 200000 housing units provision.(UN-Habitat, 2011).

2.4.1 Concept & Definition

"Affordable housing is generally defined as that which is adequate in quality &location

and does not cost so much that it proscribe its dweller, meeting other essential living

expenses or intimidate their pleasure of vital human rights. Housing affordability is

influenced by several aspects. Affordability is primarily set by two key variables: capital

variables (house buy costs) and occupation variables (costs linked with caring house). The

16

capacity of a household to buy a house is influenced by the purchase cost (which is

aggregate cost of land, infrastructure, labor, building materials and profit) and the capacity

to sponsor purchase (principally set by finance down payment requisite and balance of

household savings)" (UN-Habitat, 2011).

"There are three features to judge the capability of a household to buy a unit. That is;

purchase, repayment and income affordability. Purchase affordability considers whether a

household is capable to lend sufficient funds to buy a house. Repayment affordability

considers the load forced on a household of reimburse the mortgage. Income affordability

merely measures the ratio of house value to income. The earlier two ideas consist of extra

factors that illustrate down payment ratio, the per period mortgage-payment to income

ratio, length of mortgage, and mortgage interest rate" (Gan, Hill,2009; Suhaidab &

Basria,2011; Gandhi, 2012; Paris,2006). As per International standards of demographia;

Housing markets are affordable at or below 3 times gross annual household income and

critically unaffordable at or below 5 times income(Suhaidab &Basria,2011;Gandhi, 2012).

Typically ‘affordable’ housing is" that, as not being above a specific share of household

expenses, often now 30 per cent. Even taking point-in-time contrast at face value, critics of

this approach argue that 30 percent of a low income may be less ‘affordable’ than 40 per

cent of a high income because 60 per cent out of a high income still leaves a household

much more disposable income. Stone has highly stressed for a residual income approach

to affordability (Paris,2006; Gurran & Whitehead, 2011; Afshar, 1992).

Affordable housing's notion is multifaceted and diverse but can be clarified in economic

terms. An affordable house is defined as a house that a family group can attain within a

given period, which normally varies from 15-30 years. That time period is directly linked

to the purchase ability of group and the financial assistance that they can attain in terms of

17

mortgage, credits and subsidies (UN-Habitat, 2009; Wallbaum & Salzer, 2012). The

lifetime venture for affordable housing demands more benefits in the form of quality, ease

and durability, so as to spotlight on social issues also. Affordable housing is "housing that

costs less than 200USD/m2 to fabricate, including the costs related with construction and

finishing details" (Wallbaum & Salzer, 2012).

Stone defined housing affordability as "a relationship between housing, people and

family's decision option between housing & non-housing expenditures" (Suhaidab &

Basria, 2011). For Housing affordability assessment/measure, in addition to income &

house price factors, that assess the household's capability to pay installment of house,

there are other factors i.e., education level, type of occupation, number of households that

work, have children, monthly installment of house, and housing subsidies (Suhaidab &

Basria, 2011). Housing affordability could be established by achieving a balance between

house price, mortgage interest rate & household income (Gandhi, 2012). The measures for

affordability may include the housing consumption, that is housing payments, Government

subsidies, returns (rising prices), costs related to housing location (transport cost), design

(energy & water efficiency) maintenance & management (Gurran & Whitehead, 2011).

Affordable Housing is described by three parameters, that cities are required to adapt as

per their local conditions; Firstly Housing cost that consume not more than 30-40% of

household income, Secondly, as per households opinion, a socially acceptable, decent

living standard housing unit. How much floor space required in that unit replicates,

household choice, regulatory limitations and market situation. The minimum standard for

essential amenities i.e, water and sanitation, access to school, health and distance to job,

maximum one hour. (McKinsey, 2014) The aim of affordable housing is not only to offer

essential shelter needs, but to comply the planning & building regulations, fulfilling the

18

household requirements i.e, amenities, size & location and fulfilling the affordability

factors. During economic crises, affordability levels are dependent on household income

rather than on house building and land cost, an aspect, which is totally independent from

construction industries (Jian & Wilson, 2009).

2.4.2 Dimensions & Challenges of Affordable Housing

There are four dimensions of housing affordability, (1) House purchase cost (Land,

infrastructure, building materials, labor/profit) are capital variables as material /house

Input. (2) Ability to finance purchase (Finance-down payment requirements) and saving &

other assets are capital variables. (3) House living cost (Land lease /rates, service cost and

unit repairs) as occupational variables. (4) Ability to financially service (Finance-interest

rate and loan periods) and under income/expenditure (income minus non-housing

expenditure) (UN-Habitat, 2011).

The key challenges of affordable housing are; (a) Lack of resources (b) High cost of

construction (material & labor) (c) Lack of affordable land (c) Shortage of affordable

finance (d) Ineffective regulations & policies (e) Limited time as against quick demand (f)

Lack of trained labor (g) Quality management (h) Quality & Location (I) Community

participation (Wallbaum & Salzer, 2012).

2.4.3 Need for Affordable Housing

In developing and least developed nations, building sectors has been rated as having high

economic and social value. The urbanization patterns are being observed in these countries

and it is estimated that world population's 70% will be residing in cities by 2050. This is

due to the fact, that people are attracted to cities from rural areas for better life and living

conditions. As cities are center of wealth and progress. At world level, in developing &

poorer countries, the housing sector is of key social & economic value. There will be huge

19

demand of housing due to the rise in urban population globally. The present housing sector

doesn't have the capacity to meet the housing demand. This gap between supply &

demand pushes the construction of in-efficient and costly solutions and informal

dwellings. This trend raises the demand for producing affordable housing for low income

group who can acquire it affordably. Moreover for affordable housing, affordable,

environmentally sound and appropriate techniques and technologies need to be introduced

in market, along with skilled labor. It will help to reduce slums/katchi abadies,

environmental problems, and will create job opportunities for low income group

(Wallbaum & Salzer, 2012).

Many authors described the housing sector as the key user of energy & resources in

present environment. So it is of great concern to develop technologies & native ideas and

its potential & performance to be examined. Moreover sustainable housing should be

developed with objectives to reduce energy & flow of materials, reduced environmental

impact, during the life cycle. (From Planning, design, construction, use, operation &

maintenance and demolition) (Cradle to grave) (Wallbaum & Salzer, 2012) . Affordable

housing provides opportunities for economic growth, environmental improvement and

social equity, while sustainability at the same time. It reduces problems related to

urbanization, poverty, slums, climate change, inadequate housing, energy consumption

and water scarcity, economic crises and their impacts. The houses are built without due

consideration of needs of residents & its connectivity to the services. Construction costs

are reduced, using substandard materials & techniques rather than finding affordable &

sustainable solutions, for all income groups especially poor. In such kind of informal

housing people are forced to live in, as no other option, being a source of health related

problems (sick building syndrome) and unaffordable running costs. Affordable housing

will be in access to poor, fulfilling their social requirements in affordable manner and will

20

provide safe, healthy living environment & well being as well. Moreover it will be

beneficial for built & natural environment and long life (UN-Habitat, 2012).

2.4.4 Planning Tools & Affordable Housing

The basic aim of land use planning is to increase the resourceful use of land and guarantee

its equitable use. It is partly shared by public ownership, land allocation, tax and subsidy,

which modified the incentives to use land in defined way. The land use planning document

defined a particular use of land for housing and sometimes excludes some significant uses

(Whitehead, 2006). In UK, the planning system, manages the available land for

development. It affects the quantity, location, timing, and quality in view of intensity of

development. There is a link among planning, price of land, and housing. Further it is not

easy to ascertain the effect of planning on house price, as explained by many researchers

(Rebecca, 2006). Planning affects directly or indirectly the efficient use of land &

residential density (Rebecca, 2006; Gurran & Whitehead, 2011). UK has used the planning

system for the provision of affordable housing by concentrating on social objectives, while

in Australia; Planning law has restricted the way social goals including affordable housing

could be followed through planning process (Gurran & Whitehead, 2011). There is vast

body of theoretical and empirical research analyzing the relationship between land use

planning, land, house prices & house building rates, over time, most of it initiated from US

and UK. Which lead the urban planning a kind of interference in private market with the

purpose of more efficient, equitable, socially beneficial, form of development, Interference

done by expressing policy/land use plans, system for land, infrastructure coordination,

procurement, i.e., share by developers as infrastructure development cost share, urban

regulations for managing urban change (Gurran & Whitehead, 2011). Planning

regulations, development controls, and fees are tools that could be used for development

of affordable housing. In US specific housing types or low income group has been

21

excluded from some areas in planning/development, for such areas, inclusionary

planning/zoning techniques are needed to reserve a part of development for affordable

housing (Gurran & Whitehead, 2011). Population density differ significantly from 3 per

sq. km in Australia, 55 in Ireland, 240 in UK and almost 3000 per sq.km in Hong Kong

(Paris, 2006). In Hong Kong Government owns land, as income base and a strong

planning instrument, which relates to changes in land &housing cost. Planning can assist

to deliver affordable housing or decrease rising issues of affordability. Through Land use

planning private development could be promoted for the provision of affordable measures.

Planning also affects the location of low cost housing. Evidence shows that use of

planning standards have strong effect on, where additional affordable housing is provided.

Affordable housing provision has been promoted in England & Ireland by using planning

regulations, which proves its impact (Paris, 2006).

As the plan will constrain some socially undesirable uses thus increasing land price. A

good plan should produce both social welfare & higher land value. An important input to

housing is land & its quantity could be adjusted as per density of development. The

developers will use less per unit land if land prices are higher. So a significant part of

landuse regulation is density control and affects available alternative directly, housing cost

delivery, services, social and private housing worth. The affect on costly land, on house

price is compelled by market and zoning regulations/framework. Three major economic

causes of supply of affordable housing through planning are; As the basic Government.

objective is resource distribution improvement, As per land use plan, main objective is

access to land for all equally, which is done by allocating land for low income. Secondly,

major outcome of land use regulation is to raise cost of land for housing, thereby creating

affordability problems for poor households looking assistance. Thirdly raised land cost

result, in money distribution again to landowners, without doing any effort for that

22

increase. It is society using landuse regulations for efficiency & political motives that

raised land value (Whitehead, 2006).

• Landuse and Building Regulations:- Building and land use regulation are non-

supportive for affordable housing in many cities. The restriction and law on land use &

building raises households per unit cost,i.e, restriction on building height, smaller building

heights & restriction on storey allowed (UN-Habitat, 2011). As most urban household

desire maximum plot area, the actual fact is to enhance affordability mainly for lower

income group; the reduction in development cost must be done. Planning regulation,

modification of bulk supply of affordable land for household is an important factor for

improving delivery of affordable housing. Planning & building regulations play a crucial

part for analyzing the housing affordability. Somehow cities have inadequate standards &

regulations that escalate the price of land & housing. Pakistan experience proves for

modifying building standards and regulation, i.e. minimum lot size and building height

limit, can lead to reduce housing development cost, but also allow for existing up-

gradation, by using more flexible standards (UN-Habitat, 2011). Many Asian countries

have tried to use land use regulation as a tool for allocating affordable housing

development in a planned way but with uncertain outputs. Even if local community group,

Government department, and NGOs have done such development, it faced hurdles

created by market forces, who propose it is to be actually used as against zoning. Land use

regulation when allocate land for housing, it indicates its subdivision ways, allowed

building heights & density, and the type of infrastructure service to be developed. Actually

such regulations are promoting high cost housing, by imposing un-realistic standard,

limiting the amount of formal housing. Zoning, land use, and building regulation can be

modified as per need of poor and can improve the quantity of affordable housing in the

formal market. Land use regulations that propose land for affordable housing could be

23

important tools for communities requiring land (UN-Habitat & UNESCAP, 2008).

2.4.5 Socio-Economic Determinants and Affordable Housing

In developing countries, the well being of millions of population is being affected by the

substandard, inadequate, overcrowded housing condition in densely populated urban areas

(Sengupta, 2010; UN-Habitat, 2011). The affordability, availability, quality and quantity

turn out to play a major part in National Economic Development. & Socio-economic uplift

of moderate to low income households. The households migrating to cities from rural

areas in search of better living standard anticipate to get a decent and safe house at

affordable cost. So the Provision of affordable quality housing is directly related to the

social cohesion of the households (Earnest, 2012). Many Socio-economic issues are the

result of poor quality housing, lacking affordability (Baqutaya, 2015).

From social point of view, in addition to shelter, Affordable housing provides security,

relief from stress, enhance the well being, self-esteem & education status (Wallbaum,

2012). From economic point of view Housing is the largest lifetime investment for a

household and affects to a great extent the socio-economic well being (Baqutaya, 2015;

Bujang, 2010; Opoku, 2010; Maliene & Malys, 2009; Wallbaum, 2012). Efficient landuse

planning provides equal accessibility to housing, facilities and transport for various socio-

economic groups and marginal household in a society that enhance the social environment

by upgrading the living conditions and improving community social cohesion

(Butterworth, 2000; Hugh, 2009). Landuse decision regarding housing, transport and

economic progress are main determinants of households living choice (Hugh, 2009). If the

incomes are lower as compared to high unit prices, with poorly managed housing and land

supply, then it results in rising social segregation in housing markets (Barker-2004;

Bramlay, 2009; Hugh, 2009). In UK & US affordability is sometime described in terms of

24

affordable housing. Stone defined affordability as a relationship between housing &

people and family's decision option between housing & non-housing expenditures

(Suhaida et al, 2011; Stone, 2006). Due to lack of affordability, poor households are

forced to live in overcrowded & low quality housing, at far of location away from their

social network, unsafe & unhygienic living conditions, lacking tenure security (Stone,

2006; Hugh, 2009). In addition to population &urbanization trends, Planners must

consider affordability level of household in planning affordable housing keeping in view,

household income, capacity to pay, choice/criteria for price & location, and selection

regarding tenure, type & quality of housing. (Bujang, 2010; Golland & Gillen, 2004).

Efficient & functional house designs can affect the social determinants in selecting house

and affordability (Opoko, 2010). Limited Affordable housing provision prohibits the

capacity of an area, to offer such housing in sufficient quantity and quality for the needy,

while a steady supply of affordable housing guarantee the community social cohesion

(Winsten, 2009; Roween, 2014).

Social Status:- (Age, Gender, Household Size, Education, Marital status, ownership

status) A family’s social status &socio-economic factors including age, Household size,

Gender, education, income and employment, unit cost ,location, occupation, earning

members & transportation cost affect the housing requirements and choice, which impact

the household configuration, and therefore major determinants of housing demand, supply

and affordability. (Roween, 2014; Bujang, 2010; Linmen & Mulbegul, 1992; Suhaida,

2011). While size, structure and population Growth is the factor for the housing demand

(Bujang, 2010). The quality of self esteem and security with house ownership can’t be

easily attained with age and income (Tan, 2012). The ownership of housing has many

social & economic benefits for the households and the overall community. House

ownership enhances the living environment, self esteem, satisfaction level, in house and

25

regarded as a vital gain in lifetime (Tan, 2009 & 2012; Rohe et al, 2001). Housing

affordability has significant relationship to education, various phases of life, HH size, and

nature of job, as documented in many empirical studies. Household's life cycle is highly

associated with marital status and HH size. An increase in household size will lead to high

ownership rate and will impact the housing demand and affordability (Goodman, 1990;

Tan, 2012). Married households highly impact the housing affordability and male

household heads are also likely to affect the ownership of house with more income as

compared to females (Tan, 2012). Larger household size need to spend more on housing

and non-housing expenses as compared to small size household. Adult earning children

living with parents help in additional income of household. Women household heads face

more housing cost liabilities (Saleh et al, 2014).

Education:- Affordable Housing can enhance the educational status of households.

Overcrowded housing conditions lead to stress among children & women and affect the

educational outcomes of children living in such condition as compared to those living in

better quality housing. (Roween, 2014; Braconi, 2001; Spencer, 2010; Bratt, 2002)There is

significant positive relationship between affordable housing and benefits in health and

education level in a community& enhance overall well being with satisfaction level of

households. (Rohe & Stagman, 1994; Gopalan, 2015; Mueller & Tighe, 2007). The

affordability to own a house increases with education status of households. (Tan, 2012;

Gabriel, 2001) Nature of job is closely linked to education status of a household. Low

level education &job skills results in low paid job and in turn household can only afford to

support small household and chose to live in low quality housing one of the major cause of

affordability issues among lower/middle income households. As higher level of education

leads to better jobs with high income and a source of better living standard with decent

house ownership. So the low educated household with less income can’t afford good

26

quality housing due to lack of affordability as much of its income go in heads of non-

housing expenses. Consequently lower income and higher cost of housing increase

affordability issues (Saleh, 2014).

Overcrowding:-(Unit/Plot Size & No of rooms) Plot/unit size and no of rooms are social

determinants that are considered by most household, while buying and constructing the

house. Most of the household keep on adding space to their unit with the passage of time.

The overall quality of units with ownership is better than rental units(Tan, 2012).

Household have no choice than to live in low-quality small size unit due to affordability

issues of owning a decent house. (Saleh, 2014)

Income, Expense (saving) & Employment:- House affordability is a situation where a

household has the capacity to save part of their income for house construction/

improvement as well as to pay other non housing expenses during their life time. (Anirban

et.al.2004;Bujang,2010; Roween,2014). The lower income group not only has low income

but irregular, so they can’t afford to avail the finance in the current terms (Wallbaum,

2012). Income level of household is dependent on education status that will further

differentiate household affordability level (Bujang,2010; Linneman & Megbolugbe, 1992).

Rising income and job security is highly related to affordable housing (Berry, 2003: Rohe

& stevert, 1996). Employment and income are closely related and determinants of

affordability and greatly affects the social status, which is a major determinant of wellness

and affordability (Hugh, 2009).

Stone used the residual income approach to describe affordability, as the non-housing

expenses are restricted by how much is left after paying for housing. So a household is

having an affordability issue, if he can’t meet his non-housing requirements after paying

for Housing. (Stone, 2006; Saleh, 2014). When low to moderate income household spend

27

30% or less for housing, called affordable housing. Stone describes it as it is beyond the

poor’s reach, after meeting the basic non-housing expenses. A household's well being is

severely affected if the major part of income is reserved for housing, resulting in reduced

saving for meeting the basic non-housing expenses i.e., for food, clothing, Health,

transport, education & Recreation (Bratt, 2002). For example two households with same

income but one with two member household and the other with household size of 5, the

former will have to spend less on non-housing expenses as compared to later, which leads

to affordability issue for higher household size to spend on housing than the small

household size. Similarly if two families with same household size but with varying

income levels are considered for affordability, it will reveal that household with higher

income will have more saving for having a decent housing ownership than lower income,

as both have to spent almost same amount for non-housing expenses to achieve a

minimum basic living standard (Stone.2006). The household income to housing expenses

relationship is sometime said to be housing Affordability and a key determinant of

affordability (Whitehead, 2009; Roween, 2014). Affordability is the relation of income to

relative price of unit. Whereas as per household affordability, income; socio-economic and

demographic factors significantly impact demand. (Stone, 2006; Bujang, 2010; Roween,

2014) Household size, age, income, interest rate and savings affect the affordability and

have significant relationship. Moreover, employment and education level is also highly

related to housing demand and affordability (Bujang, 2010; Sirat et al, 1999). Higher

unemployment leads to lower average incomes and affects the household affordability to

own a house. (Roween, 2014; Bujang, 2010).

Employment:- Availability & accessibility to job opening is a key determinant for an area

to live affordably as it has great impact on household income. With low chance of job

opportunity, creates stress on household capacity to afford housing and also travelling too

28

far for job affect the household's income and affordability (Fisher et al, 2009; Winston,

2010, Aslund et.at, 2006; Roween, 2014).

Unit Cost/Land Cost:- High housing price is compelled by socio-economic factors.

(Bujang, 2010; Quan & Hill-2008) Affordability level is essential for a family to purchase

and own a unit. (Bujang, 2006 & 2010). Initial construction cost is the major factor for

most of the household with low income. So the low income of poor household should be

taken in account, as key constraint while planning for construction technologies and

techniques (Wallbaum,2012). Affordable housing considers those household's needs, who

have insufficient income to own adequate housing without financial help (Milligan, et.al.

2004; Roween, 2014). If the cost of purchasing/ constructing a decent quality house is

more than the disposable income of what household can afford, then household is facing

Issues of affordability (Stone, 2006). Housing cost is directly related to households well

being. Household who hardly meet their housing & non-housing expenses may face health

issues & prone to stress conditions. (Bratt, 2002) Poor households use sub-standard

construction materials that reduce house durability and its resistance to humidity &

hazards and increase the repair & maintenance cost. (Wallbaum, 2012)

Location/Accessibility:- Location of housing and type, social-economic determinations

affect the affordability and housing demand. (Indrus & Ho, 2008; Bujang, 2010). Lack of

access to school, health and park etc, can lead to adverse social impacts and well being of

households (Hugh, 2009). Availability of commercial area, health, services and parks at

walking distance has a strong relation to well being & affordability and enhances the

social cohesion (Hugh, 2009; kuo, 2001). While constructing/buying or renting a

house/plot, household consider aspect of location, cost, and living environment and

amenities (Tan, 2012 & 2011a). House/plot purchase criteria of household is highly

29

dependent on location determinants i.e., distance to school, employment, shopping, health,

parks & public transport at walking distance.(Tan, 2011a & 2012) A housing project's

success is related to good location (Kauko, 2007; Tan, 2012). Reduced distance to

employment save time, cost of transport, enhance job security and efficiency (Tan, 2012).

Middle and low income households prefer to get a plot/house close to their job impacting

the affordable housing location (Tan, 2012; Opoko, 2010). The married household with

children prefers to have plot/house near to school. (Tan, 2012). While most prefer house

near to park or green space as a source of social cohesion (Tan, 2012: Maliene & Malys,

2009, Winston, 2010, Roween, 2014) at the same time such location are unaffordable for

lower to middle income household due to high cost. (Tan, 2012) Adequate and decent

housing in a healthy environment is mostly owned by upper & higher middle income

community (Tan, 2012 & 2011a). Lack of adequate water & sanitation facilities will have

adverse affect on the housing location/cost (Tan, 2012).

Affordable housing must be in proximity to public transport, as transportation cost impact

the housing affordability and accessible public transit affect positively on household

Income (Winston, 2010; Roween, 2014). While choosing housing to live and own

household prefer proximity to better education institution &shopping areas, as it contribute

the well-being of household (Fisher et al, 2009; Samual, 2005; Roween, 2014). A good

housing location consists of accessible public facilities (i.e. education, health, park)

proximity to workplace, public transport, & healthy living environment. Whereby due to

high cost of housing in such location, push the poor to find housing at suburb of cities

away from workplace/social network, lacking public facilities, mostly slums/informal

settlements (Saleh, 2014). Affordable housing enhances the overall health of households

due to healthy living environments (Gopalan, 2015; Lubel et al, 2007).

30

2.5 ACCESS TO AFFORDABLE LAND.

The basic issue for the urban low income group is their incapacity to access secure and

affordable land for their minimum housing requirement. To survive, progress and feel safe

for poor household, land's access is an important part of his life. In addition to access to

services, shelter and secure land right provide safety & financial security at difficult times.

Land is a vital transferable asset, which could be sold, rented or leased out. Secure land

right/tenure security also support the people to invest in housing and land. Various laws

and policies governing land use &land tenure to tackle with diverse matters has been

developed by many Asian Governments (UN-Habitat & UNESCAP, 2008).

Lack of access to affordable land gives rise to higher living costs, slums/squatter

settlements, environmental degradation and urban poor’s vulnerability. In Most Asian

countries, national Governments are responsible for land policy and legislative

frameworks, related to planning and tenure, whereas local Governments are responsible

for land management and development with an effective land framework. Private

developers having sound technical knowledge and techniques for delivering &developing

land can play key role. Further tenure security and property right are other major factors in

addition to access to land that significantly affects affordability and housing adequacy. In

many Asian cities, land tilting and registration process is costly and time consuming thus

escalate the final housing development cost. In Pakistan, it involves many steps and much

time consuming and more costly process, while Saudia has lesser cost and less time

consuming. Cities where land is mostly owned by public sector, land availability is an

issue as in Delhi and Karachi, while it is also an issue where it is mostly owned by private

sector. The provision of serviced land and housing by the public sector is reduced to lower

income household in many Asian countries due to many reasons i.e., lack of resources,

technical ability, political will & insufficient management,. There are several measures,

31

adopted by many cities for providing serviced land at good location &at affordable cost,

i.e., land banking, land sharing and land readjustment.

As per global shelter strategy 2000, major failure of Government's housing sector is the

lack of capacity to provide enough affordable and legal serviced land for fulfilling

requirement of low income housing. Many countries including Bangladesh, India,

Pakistan, and Malaysia have initiated housing programs to overcome this failure but could

not cope fully specially for low income groups. One of the good examples for efficient and

improved land administration system for poor is bhoomi land system in Karnataka India.

Bhoomi has computerized 20 million land ownership records in state. It involves online

delivery and management of land records. Which reduced the need for lengthy procedures

i.e.; any changes in land ownership made by other parties &its verification system. It is

transparent system of providing land, good example of public/private partnership and local

access to all, including lower income groups (UN-Habitat, 2011). In Asia urban residents

between 30-50% does not have any kind of legal land tenure document that proves their

ownership. For Example in cities like Dhaka, Delhi, Karachi, Manila, %age of people

living in informal settlement without any tenure security is much more than %age of those

living on formally accessed land (UN-Habitat & UNESCAP, 2008).

Tenure Security is defined as "when people believe that the land they occupy is the land

they are allowed to live on any use". The options for poor are reducing to live on unused

public land and develop informal housing (UN-Habitat & UNESCAP, 2008). As the

leftover land is being occupied by Government and private developers for commercial

development and infrastructure projects, and they tend to evacuate people living there,

sometime these people are compensated in cash or in the form of housing and sometime

without any compensation, which is a critical issue to alleviate poverty. National

32

Government, in many Asian countries regarding land management, while local authorities

have little role to play in resolving issues of landlessness. How the land is to planned,

developed, serviced and used for, the relationship of residential scheme to road and

transport, and where Infrastructure i.e, water, sewer could be built economically and

efficiently. Its costly development and inefficient/unplanned land lead to wastage and loss

of revenue. More strict & costly regulation/laws about land management, often fail to

fulfill the poor's needs, requiring simple & affordable framework (UN-Habitat &

UNESCAP, 2008)

Turner described a situation, where, if the security of tenure & time is assured to poor

households,, they will upgrade their housing to standards and titles of such available land

to be made recognizable, to avoid any legal quarrel over land involving poor (Choguill,

1994 &, 2007) Enough evidence is found in developing world, where in particular cities &

situations that model works and perhaps 50% of urban poor are not getting that facility in

many locations (Choguill, 1994). In land transfer, sale & registration process, local

&central Governments are involved. It is the Government's duty to arrange adequate land

availability for the house construction to households at a price they can afford (Choguill,

1994 & 2007; Islam, 1996). One of the key features of urban land is that, it could be

utilized for multipurpose functions during urban development at various time periods

(Afshar, 1992; Choguill, 1994 & 2007). Government can recycle such land, where old

uses have abandoned, and could be used for other purposes but not to demolish informal

settlements/ katchi abadies, as potential for upgrading/improvement in living

conditions/housing exists here for the inhabitants. The squatter settlements mostly

encroach unused Government land, on the other hand Government can designate such

lands for affordable housing in formal ways (Choguill, 1994 & 2007). Moreover through

an efficient tax system, the investment could be used for community uplift, housing and

33

land (Choguill, 1994). About 70% of population in Dhaka doesn't own land. Government

intervention is required for encouraging landowners for developing it for high density

housing with minimum standards. With the assistance of private developers, lands at the

periphery could be allocated to lower income group on lease, or on long term installments

with loans (Islam, 1996). Housing problems are partly related to poor land management &

land ownership by public bodies (Gandhi, 2012). In Indonesia, one of the well known &

highly recognized huge upgrading project KIP (Kampang Improvement Program) has

faced the major issue of land tenure (Berner, 2010). As such many upgraded residential

schemes are technically illegal. That leads to restricted interest due to insecurity &

resulted in significant maintenance issues. Developed sites at prime locations held by the

wealthy class, often subjected to many types of speculation. Over the past 30-40 years, in

many south cities, most of land sites were provided by the illegal/informal land markets

for major housing stock development. The main prominent aspects, all of which are

mutually related are; economic growth, country's political setup, city's growth & size,

availability, worth & tenure type of disputed land in & at city's outskirts, capability of the

Government & desire to impose law and execute policies. The competition for urban land

has reduced due to economic crises in Southeast Asia, in the affected countries.

Commercial development reduced and many ongoing projects closed and many

speculators sold land at throw away prices (Berner, 2010).

Lack of security of tenure gives rise to slums & squatter settlements (Bredenord &

Lindert, 2010) Choguil described that the households in communities should have a

feeling of safety in residential environment for investing time, money, efforts for any sort

of up-gradation/renovation in housing & infrastructure (Bredenord & Lindert, 2010;

Choguill, 1994 & 2007). Many families living on illegal land with insecure tenure use

materials i.e., card boards, plastic pieces & rush mats etc., it should not be imagined that

34

they will invest for a durable house, but sooner they get legal ownership of land, they will

improve their housing with the passage of time/incrementally (Bredenord & Lindert,

2010). Due to shortage of urban land, caused by public ownership & inefficient land

management (Gandhi, 2012), it is unaffordable in Kolkata and other cities which resulted

in high real estate value (Sengupta, 2010).

UN-Habitat has proposed strategies and policy measures for making land more accessible

to the poor (UN-Habitat & UNESCAP, 2008);

Strategies:-(a))Planning more efficiently:- One of the finest techniques to use minimum

land for maximum livable area for poor is to plan a row housing scheme with detached

housing (two storey) with 1-2 meters front and back yard for light, air, washing and bike

area. Such as, Mumbai and Bangkok are the examples where successful row housing

development has been done with 15-20m2 plot size. More approaches are; Planning for

higher density, Planning for multistory, Planning efficiently, Planning roads for

pedestrians not cars. (b)Better land information. (c) Better land taxation (d) Land

sharing(e)Land re-adjustment (f) Cross-subsidy scheme, (g) Using public land for housing

(h) Regularizing existing slums (i) Sharing Informal land developer's experiences (j)

Encouraging community ideas (UN-Habitat & UNESCAP, 2008).

Policy Measures:- (a)Extending limited security to present slum households.(b) Finding

out about all the informal settlement's option to live in city or not. (c) Preference for re-

housing to be presented to those residents of these areas who can't live there (d) Award

tenure security to all the rest of slums/informal settlements (e) To boost the housing &

land delivery, rules to be improved (f) Initiate & gather taxes on all kind of land.(g) Allow

incremental development of buildings and services.(UN-Habitat & UNESCAP, 2008)

35

2.6 AFFORDABLE BUILDING/CONSTRUCTION MATERIALS

Building materials are one of the biggest tangible input in housing construction and make

up to 80% of a house's total cost i.e. if the cost of building material as compared to price

of other communities is double, then a household will require double of time in year to

afford such building material. The two major inputs, building material & land are the main

cause of non affordable housing for most of lower income group in Asian and other cities.

Poor land regulation increase development cost, while reason for costly building material

is that Government at National &local level promote conventional building materials and

technologies, which have been incorporated in building regulation and standard adopted

from other developed countries or from old age documents. These standard /regulations

restrict the use of appropriate/locally available building materials and cost-effective &

environment responsive construction technology. The role of construction industry with

having capacity of providing enough quantity housing at affordable cost is the core factor

for performance of housing sector. In many Asian countries including Nepal, local

building material industry has many drawbacks i.e. poor production, which cause price

changes and shortage. The main reason is limited technological capability. High house

cost to income ratio do have high construction cost in many cities (UN-Habitat, 2011).

The provision of affordable access to materials should be ensured to the poor & private

builders at price, they can afford, as the poor & private sector are desirous to engage their

labor for a worthwhile project in their view. One of the major causes that poor & other

private builders can't build affordable & adequate housing for themselves is inadequate

access to affordable building materials as observed by UNCHS, and restricts construction

activity, that could resolve housing issues (Choguill, 1994 & 2007). Among many issues

related to these costly materials are i.e., importing materials even simpler one &increased

energy costs. Due to this trend building material's price index have risen above the retail

36

price indices in many countries, resulting in reducing access to affordable materials by the

poor. Even when Governments favored/promoted self help affordable housing to cope

with housing shortage, in many countries, that resulted in failures, mainly due to lack of

control upon materials prices. In Brazil, a study on low income community indicated that

70% of the poor, built their housing by themselves totally/partially., while drawing most

of materials from formal building market, which further put pressure on the meager

incomes of poor (Choguill, 1994). It is also evident that most of the materials were second

hand/scrap, which was recycled for use (Choguill, 1994 & 2007; Islam, 1996). So it is

possible to establish production of recycled materials through cooperation within

community, private sector & Govt. Governments must ensure for supply of affordable

&environment friendly building materials, in addition to price and quality control. As

recycled, locally available & appropriate materials will be affordable and environment

friendly (Choguill, 1994 & 2007; Islam, 1996). Grameen bank in Bangladesh is assisting

poor for the provision of affordable materials (Islam, 1996). Over the years, very little

improvement has taken place in building materials and construction techniques. The

construction industry has kept on relying the building materials, which are costly & lack

fast production. High housing cost is related to costly building materials i.e., Brick,

Cement, steel, timber, due to inadequate supply and energy costs. In India the cost of

materials is 45% of the total build cost in even low cost projects. In terms of construction

cost indices, Mumbai & Kolkata are most expensive cities, which have increased by 30%

in last 5 years, thus making it difficult for poor to access (Sengupta, 2010).

The habitat agenda advises Government to promote the production and distribution of

building material and building industry by implying the maximum use of resources locally

available, it further recommends, production of environmental friendly and affordable

construction techniques/approaches. Furthermore it suggests for building codes up-

37

gradation and standard regulation based on recent engineering standards, building and

planning practice, local condition and ease of management (UN-Habitat, 2011). Research

and development need to be supported for innovative construction technologies. To

improve the access to affordable &appropriate building material policies required along

with improvement in trained labor's quality &quantity in the informal housing segment.

Environmentally sound (energy efficient) construction, design &methods, to be

encouraged, accessible to all. Furthermore simple technical material on building

material/technologies should be available for all segments. UN-Habitat and Appropriate

technology development organization has efficiently promoted use & production of

appropriate building material and construction technologies. For policy implementation to

increase access on affordable and adequate housing small level contractors can play an

important role with support by Government and local authorities while large scale

contractors are promoted for efficient use of labor based technologies.

Housing construction in Asian nations is especially a secure venture, as low cost housing

plays its part in boosting economy 30% more workers’ income is achieved in low cost

housing as compared to costly housing, due to the fact that informal area is more labor

intensive than formal segment. In informal area 20% more employment is generated in

construction. Construction in formal sector faces issues of labor, occupational health and

safety. So country can take advantage of urban population growth erecting jobs and

develop housing (UN-Habitat, 2011). Sub-standard & poor building materials used can

cause serious health hazards for the residents& raise repair/maintenance cost. Indoor air

quality remains polluted. The sustainable, recyclable &locally produced materials could be

used for long life & improving well-being of occupants. The durability & resilience of

building should be considered while selecting indigenous materials. It should be

affordable and accessible to the poor income groups (UNHabitat, 2012; Choguill, 2007).

38

2.7 ACCESS TO AFFORDABLE HOUSING FINANCE

For affordable housing in Asia, housing finance is the major hurdle. In some part of

countries it is not available and in some it is not accessible to most of lower income

household due to some terms i.e. high interest rate, short repayment period, and

requirement of down payment. House price does not alone responsible for affordable

housing but access to housing finance and its cost matters a lot. In Asia and other

developing countries only a small population affords formal housing with finance cost

attached. In an environment where housing finance cost too much and incomes are lowest,

it can't access to poor. Many new approaches have been implied in many cities of Asia and

developing world i.e., community mortgage program in Philippine and Grameen Bank

Bangladesh. Islamic housing finance is under development phase and can contribute in

affordable finance for the poorer communities (UN-Habitat, 2011).

The main focus area for most of the International organizations dealing housing is finance.

As per UNCHS, there is small possibility that in many developing countries, in the coming

20 years, funds availability through conventional sources for investment as per the demand

requirement for infrastructure & housing (Choguill, 2007). To obtain financial assistance

for housing, poor &low income group neither have enough income levels, nor any record

of savings in any formal bank. As majority of lower income people make their living from

informal sector, therefore can't provide any proof of regular employment to the financial

institutions for housing assistance (Choguill, 1994). For any kind of housing finance

conventional mortgage will persist. For the housing construction and meeting resource

requirements of low income population, who incrementally built/improve their shelter, an

unconventional system is to be developed, that extends small finance, limited time

maturities, flexible repayment plan & likelihood of consequential loans, prolong loan

periods, interest rates to be subsidized on loans, informal sector income to be

39

acknowledged (Choguill, 1994 & 2007). There are various attractive approaches that are

being developed in many countries. One of the successful model run by Grameen bank in

Bangladesh (Choguill, 1994; Islam, 1996; UN-Habitat, 2011). Bank initiated in 1976 with

objective to provide small loans at soft terms to poor, with low interest rate. In 1984 bank

started housing loans for low income households. Originally the model was designed for

rural residents; it is so successful that it could be extended for benefit of urban residents as

well. The main theme of Bank is to give reasonably small loans to lower income residents.

There are chances of second &bigger loan, if first loan is repaid effectively, until target

dates for repayments are met. As many residents are aware of loan, so due to social

demand, repayment target dates are met successfully. Its demand increased with low

interest rate and soft terms (with loan period 5 years, repayment weekly, interest rate 8%).

The house build were modest &flood resistant as country faces floods frequently (UN-

Habitat, 2011; Choguill, 1994)

This kind of technique is perfectly fit for affordable self help housing construction. As the

households has time &money for any up-gradation &addition. The small no. of inputs

acquired at any time may be i.e., few bricks, a cement bag, and few roof tiles. The bank

might offer the modest funds required overtime by self-help affordable housing builder for

house completion (Choguill, 1994). For lower income class that is still left out from

conventional mortgage facility, microfinance techniques need to be introduced and finance

for construction of public housing for renting to the poorest. A community based shelter

fund is a way, where extensive funds are handed over to community for the development

of infrastructure and housing (Choguill, 2007). In India SPARC, National slum dwellers,

and Mahila Milan have attempted to establish inclusive organizations consisting of

community's lowest income affiliates through savings and loans. Everyone in community

shares its experience and developed alternatives. These NGOs have developed strategies

40

to enhance affordability i.e.,by addressing regulations and standards (Mitlin, 2010).

There are many type of housing i.e. row housing, rental housing, and low to medium to

high-rise apartment. A city is required to supply regular housing to meet the requirement

of rising population and urbanization for all income groups. Old housing stock or

dilapidated housing needs repair or renovation or re-construction. The housing deficit is

particular for low income housing, as that group is unable to pay rising cost of land &

construction, and there affordable housing is not supplied as per need of poor. Housing is

unaffordable for low income households, which make housing finance, important for such

group. Housing finance mechanism need to be improved as per requirement of poor, by

providing various option of housing by Government (UN-Habitat & UNESCAP, 2008). In

Asian cities most of the houses are not built by Government / private developers but by

owner itself. It is highly popular form of housing development, in all income groups & in

all kinds of housing. The major reasons are people have freedom of choice for materials,

control over finance, labor, and whole process, as per their requirements, thinking choice

& wishes/ resources (UN-Habitat & UNESCAP 2008; Bredenord & Lindert, 2010).

Depending upon the space/ land available the owner constructs more than one unit in

phases or additional storey to get finance from sale or rent, offsetting his construction cost.

This provides lessons how to learn the requirements of urban poor and ways to assist their

informal housing supply mechanism work more efficiently & equitably. Across Asia &

developing world, countries have tried to provide public housing in the shape of low,

medium & high rise flats or large housing estates, to meet rising demand of affordable

housing, but failed to provide affordable housing, & neither able to provide enough as per

demand. Then Government considered the enabling approach by supporting other private

parties & societies through various legislation/ frameworks and financial tools (UN-

Habitat & UNESCAP, 2008). As such private housing developers plays a key part in

41

housing delivery, in the form of i.e., suppliers of parts of housing i.e, land, labor, finance

and building materials, as contractors for developing housing for individuals &

Government., agreements, as producers & sellers of housing on commercial bases. Some

Housing developers first sign agreements for payments in stages from buyers before

constructing units to have financing & reducing risks (UN-Habitat & UNESCAP, 2008).

Among many ways to reduce house price are; reducing demand, reducing the housing

production resource cost, modifying regulations (Whitehead, 2006). The decent housing

cost is almost 3-10 times of a household's income, which varies from country to country

and income group because housing cost is so high it goes beyond a poor household access.

Only rich community has enough cash to afford such housing. Formal housing finance in

poorer countries is still to be developed/operational. Due to the fact that many poor can't

afford to save or don’t save on bank due to lack of trust and purchase gold or other way of

saving. Bank prefers to loan against business rather on housing for many years. The

economic and political environment remains un-stable which indicates that the lender may

not return loan (UN-Habitat & UNESCAP, 2008). UN-Habitat has proposed 5(five)

strategies for making housing finance accessible to poor; (a)Community based self

finance.(b) Simplifying the formal sector.(c)Channelizing loans through community

saving groups.(d)Using intermediate institution to bridge formal and informal finance.(e)

Cost reduction strategies, i.e., Reducing housing cost through design, internal cross-

subsidies, by building incrementally, Mass producing housing units on large scale, Self

building by people, Introducing more practical, simple standards. Introducing standardized

building apparatus & suitable technologies (UN-Habitat & UNESCAP, 2008).

2.8 HOUSING SITUATION IN PAKISTAN

Pakistan is the 07th most populous country in the world, second largest country in South

Asia and second largest among Muslim nations after Indonesia. Pakistan's urban

42

population is growing fast. In 1998 32% of the total population was residing in urban

areas, and is likely to reach 50% in 2025 (GOP, ADP, 2012-13; UN-Habitat, Pakistan,

2009). Since 1947, the country’s population has raised from 32.5 to 132.2 million in 1998

(GOP, Population census, 1998) and 191.71 million in 2015 at an annual average growth

rate of 2.7%.(GOP & UNEP, 2013; GOP-Economic survey-2014-15).

In 2008 the population of major cities was i.e., Karachi (12.4Million), Lahore (6.7M),

Faisalabad (2.6M) and Rawalpindi/Islamabad (2.5M) (UNHabitat, Pakistan, 2009). As Per

Pakistan's Constitution "The state shall secure the people's well-being, regardless of sex,

caste, faith and race, by enhancing their living standard"(Constitution Of Pakistan (Article

38(A)) The impact of National sustainable development strategy, 2012, is yet to be seen in

housing sector, which envisions to promote sustainable development through equitable

access to poor and conservation of natural resources (GOP, 2012).

Like other developing countries Pakistan is experiencing rapid urbanization, which is

more alarming in major cities of Pakistan. This is due to the fact that people are moving to

cities for better living standards, amenities and for better job opportunities. Most of the

people found the shelter comprised of smaller living space and less mobility (especially

for women, old age and children) with high density. It results in limited daylight,

ventilation & poor quality & overcrowded housing (Zaman, 2011; Haider; UN-Habitat

Pakistan, 2009). As good quality housing is highly unaffordable and that too

unsustainable. Due to urbanization and rapid population growth, Cities equipped with

already aggravated infrastructure and poor housing face more severe pressure. Moreover

lack of adequate & affordable housing provision is giving rise to slums & katchi abadies,

as low income groups and poor have no other choice. Lack of water and sanitation

facilities are creating unhealthy living environments and other related environmental

43

problems, and affecting mostly poor & low income people. Among rapidly

urbanizing/growing cities are; Lahore, Karachi, Faisalabad, Gujranwala,

Rawalpindi/Islamabad, Peshawar, Quetta, Multan, Hyderabad.

Table 2.2 - Pakistan's Population, Urban Population and Poverty

Population and Poverty Urban Population Projection

Population total (millions), 2011 176.7 Year

Urban Population (Millions)

Urban annual growth rate

(%age) Population growth (annual average, %), 2005- 10 1.8 2010 66.3 2.97

Urban population (% of total), 2011 36.2 2015 77.4 3.10

Population density (population per km²), 2011 22 2.4 2020 90.2 3.06

Net migration rate, 2005−10(Migrants per 1000 pop.) 2.4 2025 104.7 2.99

Population living in poverty below $1.25 2005 PPP a day, (% of pop.), 2008)

21.0 2030 121.2 2.92

below national poverty line (% of pop.), 2006 22.3 UNESCAPE-2012

Due to security concerns, in Karachi, KPK and Baluchistan, people are also moving to

cities & Towns of Punjab to find safe and secure place to live, which further deteriorate

the problems of housing shortage and Infrastructure. That also give rise to the rents,

whereby poor are unable to find affordable rental housing. The current Zoning and

Building regulations support sub-urban sprawl which result expansion of cities to peri-

urban areas. Agricultural areas are being converted to residential use due to growing cities

and urbanization. In spite of the many vacant plots, in the planned housing schemes, poor

have to live in slums & katchi abadies (Zaman, 2011).The devolution process commenced

in 2001 in the form of local Government, (TMAs & Development authorities) is yet to

give its output, due to uncertain economic, political situation and inefficient housing

policies (UN-Habitat, Pakistan, 2009). KPK and Baluchistan are among the poorest

provinces with southern Punjab and Sindh also facing poverty issues. 1/3rd of population

still lives in poverty. As per MDG report-2006, the poverty level has reduced to 23.9% in

44

2005 as compared to 34.5% in 2001. As per human development index, among 177

nations, Pakistan stands at 134 and last rank in South Asia (UN-Habitat, Pakistan, 2009).

The Medium term development framework (MTDF) 2005-10 launched vision 2030 for a

prosperous Pakistan through rapid & sustainable development. Vision-2030 classifies

cities as engines of economic growth, centers of economic movement, and knowledge &

authority. It also recognized that urbanization is leading to urban poverty, it needs to be

addressed with proper planning (UN-Habitat, Pakistan, 2009). Minimum wage for skilled

and unskilled workers has been fixed @Rs.12000/- per month effective from, 1st July,

2014, and in KPK it is fixed @Rs.15000/- per month. (GOP, 2014) Vision 2030 proposes

a strategy to enhance the urban land market's effectiveness through: (a) appropriate and

affordable land use, building standards and regulations; (b) Land transfers mechanism

improvement (c) Actions to reduce the land speculation (d)upgrading public information

on land market indicators (UN-Habitat, Pakistan, 2009; GOP, Vision, 2005).

2.8.1 Housing

Cities and Towns of Pakistan are facing acute shortage of housing. In 1998, the housing

backlog was 4.30 million units, with persistent annual accumulation of 270,000 housing

units. The household size was 6.6 & per room density was 3.3 persons. The proportion of

rental housing was around 22% as per 1998 census. (UN-Habitat, Pakistan, 2009; GOP,

Housing Policy, 2001; Population census, 1998). In 2009, estimated housing backlog was

7.57 million units, of which in urban areas are 2.5 million, and the total national housing

stock was 20.5 million and about 6 million of total housing deficit was among middle

&low income groups. The lowest two income groups comprising 2/3rd of population can't

afford mortgage finance & house, the shortage of such housing is about 4.5million units.

(UN-Habitat, 2011, WB, 2009) Annual demand of housing is 0.7million due to population

growth, while increase in present housing units is only 3million units per annum, whereas

45

annual depleting units is 1% or 0.2 million, which doesn't make any difference to present

housing stock. About 40% of housing is semi-pacca (WB, 2009) Present Housing deficit

has gone up to 09 Million units. Average household size is more than 6, while the density

per room is 3.5 persons in contrast to international standard 1.1 per room density (GOP,

2015). Conventional developers usually meet the demand of about 30-40% of upper

middle & higher income groups. While 60-70% of housing units belong to lower income

group. The housing deficit for low income households is about 4.5 million units, with

annual addition of 150000 units (GOP, 2015). The average density per room in urban

areas is 3.5 persons per room, in contrast to international standard 1.1 per room density

(GOP, 2015), which is same as in India, but much higher in contrast to US density of 0.5

persons per room and 1.1 in EU and Srilanka. (Wb, 2009)

In Pakistan 12% of total population belong to high income group (Rs.250000 &above)

own/ have access to 56% of total housing units, and 20% of median income group

(Rs.30001-Rs.250000) own/access to 43% of total housing units, while 68% of total

population related to low income group has 1% of total housing units with affordability to

own (Siddique, T., 2014).

The week supply is hardly meeting 1/3rd of the housing demand. Government housing

projects take a long time to develop, where people can construct their house and live. On

the other hand, private sector housing projects are also not transparent, apart from few

private developers. The overall quality of housing is inadequate, unaffordable for low

income people. 30% of the total housing units are old, which demands improvement. The

destruction of housing due to Natural disasters i.e., floods & earthquake, further aggravate

the housing problems of the poor communities. The lack of sustainable, affordable

housing is another cause of inadequate housing &environmental problems. The affordable

46

urban land and secure tenure availability is the key constraint in housing and its access to

poor. (Haider;GOP, 2011; UN-Habitat, Pakistan, 2009). About 463000 housing units

destroyed in 2005 earthquake, that further stressed the housing deficit (UN-Habitat, 2011).

Adequate housing does not mean only shelter but access to adequate water & sanitation

are key indicators for achieving resident's well being, satisfaction and productivity

(Haider, 2011). The level of housing finance is as low as 1% of GDP as compared to 10-

15% in other developing countries (Meckinsy-2009; GOP, 2011), which is 50-70% in

developed countries and 7% in India (WB,2009). The traditional source of housing finance

is HBFC, whose disbursement is inadequate to meet the annual demand of Rs.08 billion.

To some extent it has been compensated by other private Banks (GOP, 2011). Various

reforms were initiated by SBP in housing finance sector, but faced a lot of bottlenecks due

to ineffective regulatory framework, poor land registration &titling system, high land

prices, and inappropriate market lender experience, in offering solutions to housing fiancé

(WB, 2009). In housing finance, outright purchase has the largest share of 32.95 billion,

out of 53.65 billion total outstanding (61.4% share). The gross outstanding for

construction & renovation is 14.80 & 5.90 billion respectively. For construction,

renovation HBFCL is leading in financing as 50.31% & 43.52% respectively for both

sectors. The weighted average interest rate was 14% by HBFCL & foreign banks, 13.4%

for Islamic banks, and 10.8% for private banks. Average maturity period for outstanding

loans was 12.8years (GOP-SBP, 2014). Overall in Pakistan the number of household that

own dwelling units remains stable at 86 percent during the period 2010-11 to 2012-13.

91% are in rural areas in contrast to 75% in urban areas. In overall Pakistan garder\t-iron

with 37 percent is primarily used for roof construction, 43% in rural as compared to 26%

in urban areas. The wood\bamboo is second most used material in roof construction.

Provincial comparison shows that there is a decline in use of wood\bamboo as roof

47

construction material (GOP, PSLM, 2012-13).

Table 2.3: Main characteristics/indicators of Housing for Pakistan and Punjab

Description Pakistan Punjab

1998 2009 (estimated) 2013 2015

(June) 1998 2013

Total Housing (units)in Million 19.3 20.48 10.5 Housing Backlog (units) in Million 4.33 7.57 *09.0 New Housing need resulting from population growth(units in million) 0.3 1.28 Annual depletion of housing stock(%age) 1% 1% Total Population (Million) 132.2 167 180.5 191.71 73.62 100 Urban Population (Million/% age of population) 32.50% 37% 67M 75.19M 24M

Population Growth Rate(%age) 2.69% 2.03% 1.92% 2.64% 1.87% Population Density (Persons per-sq.km) 166 236 358 460

Real income per capita ($) 1257 1512 Annual growth rate of housing demand in urban area (%age) 8% 8% Urban housing units (%age &Million)

32.3% (6.03M) 32.20%

30.40% (3.2M)

Average household size (People) 6.6 6.6 *6.0+ 6.9 Household Size(Urban) (People) 7.1 7.2 Persons per room (Average) 3.1 *3.5 3

Source:-GOP,Pakistan Census Organization,1998, World Bank(2006&2009), GOP,Bureau of statistics-1998-2015,GOP,Economic Survey-2014-15,GOP,Punjab Bureau of Statistics, 2013., *GOP-015

The Punjab Government has notified 3460 katchi abadis in entire province and it benefited

around 1.7 million inhabitants. The Punjab government claims to provide ownership status

to 2.2 million residents of 326,516 units in squatter settlements (HRCP, 2013). The up-

gradation of these sites and housing needs to be focused to improve the living conditions.

The unregulated allotment of Government's housing projects and poor development

process of both Government and private sectors for delivering adequate and affordable

housing is making housing shortage problem more acute. This is due to weak zoning

regulations and building codes, as a result, poor are forced to live in slums and katchi

abadis. About 40-45% of the total urban population is residing in slums/katchi abadis in

48

major cities (GOP, 2011). Apart from other factors, income inequality and shift from Joint

family system to nuclear family has also affected the housing supply and demand.

The cities are growing haphazardly due to weak policies, zoning and building regulations

and poor implementation, which does not support the development & planning of

sustainable neighborhoods and sustainable housing. Lack of access to affordable/adequate

housing, adequate water & sanitation is on rise especially for poor. That promotes the

creation of slums/katchi abadies with unhygienic living conditions, & overcrowded

housing. Gender mainstreaming in housing policies is another issue (Haider; UN-Habitat,

Pakistan, 2009). The low income people have restricted approach to affordable building

materials & trained workmanship, leading to substandard housing, with poor ventilation,

lighting, and non-resilient due to poor planning & design. As a result life cycle cost

increases with operation/maintenance cost and make it more vulnerable to natural

disasters. (Floods&earthquake) Such housing is not energy efficient & sustainable i.e.,

poor indoor air quality (UN-Habitat, Pakistan, 2009). “Katchi abadis” are "illegal

settlement on state-owned land of more than 40 units" (ADB, 2003).

2.8.2 Urban Land

The management & provision of urban land is the responsibility of local Government.

While Government departments have been unsuccessful in offering affordable land to

urban poor for adequate housing. About 50% of the urban population resides in slums &

katchi abadis, with fear of being evacuated. Land mafia with the consent of government

agencies plays key role in raising the suffering of poor residing in slums/katchi abadis,

which may raise acute environmental problems if not managed in future (UN-Habitat,

Pakistan, 2009). Board of revenue is responsible for keeping urban land right records, with

city development authorities keeping plot ownership and development record, while

directorate of katchi abadies offer tenure security to the regularized schemes (GOP, 2015).

49

2.8.3 National Housing Policy-2001

In Pakistan housing situation is worsening continuously over the years and almost all the

policies have not been implemented in true spirit. Policy highlighted housing issue and

problems as; housing deficit has promoted the unimpeded expansion of katchi abadies,

squatter settlements, encroachment of state & vacant land. 50% of urban population is

living in squatter settlements, katchi abadies and slums. Acute shortage of adequate land

for housing in & around urban centers. The value of land is increasing continuously with

unchecked speculation growth, leading to scarcity of low-priced land, particularly for low

income group. Housing stock, about 50%, is more than 50 years old and quickly declining

due to negligence, lack of affordable & accessible housing finance. One of the major

limitations in housing production and improvement is shortage of finance. The housing

share in public sector development has decreased from 10.9% to 5.9%, in 1st five year & in

seventh five year plan respectively. HBFC the only public housing finance department

facing problems, and being made “Sharia Compliance”. Due to inflation and poor

economic situation, the costs of building materials have increased alarmingly. In 2001

average monthly income of about 81% of the households was below Rs.7000 per month,

which shows increasing income-shelter gap, and worsening affordability of the

mainstream households, mostly the low income groups. Land mafia benefit from

inefficient planning and building regulation.

Among the strategies are; To introduce a strategy through public participation &

institutional strengthening, the developments of a commercially based housing finance

system for purchase of land & house, house construction/improvement & upgrading. As

per the affordability limits of moderate to low income households, incremental housing

finance to be introduced. Through development, capacity building & innovative ideas, like

reduce housing standards, suitable technology, incremental housing development,

50

community participation and regularizing katchi abadies, the housing conditions of low

income households to be improved (Housing Policy, 2001).

Policy Measures as Indicated in Housing Policy are;

Land:- Land as one of the major input for housing, is under severe pressure due to

competing uses by public and private sector and unchecked growth of settlements, rising

land value, complex land acquisition laws. The practical & legal barriers in the acquisition

procedure shall be resolved and land acquisition law to be modified for making transparent

system & reducing litigation. In Master plan, plots reserved for low income housing, shall

be financed and sold at low-cost.

Housing Finance:- Financial institution shall be promoted to offer mortgages finance, for

housing use at market rates. HBFC & other financial institutions shall plan package of

discounted rates, with flexible installments to offer affordable loan to poor. Special taxe

rebate for housing developments.

Slums/ Katchi abadies:- Only regularization of pre-1985 katchi abadies will be followed

after that no eviction will be done, until they are re-located.

Planning, Zoning & Building regulations:- In all Government housing schemes,

sufficient plots at affordable cost will be reserved and offered to lower middle to lower

income people. While private developers will be encouraged to develop low price units.

For relocation & up-gradation of slums, katchi abadies, planning standards& building bye-

laws will be modified for incremental developers, to facilitate private developments. The

master plan will be mandatory for every urban & rural area with incorporation of squatter

settlements & katchi abadies up-gradation and resettlement planning. Revision of building

code of Pakistan & NRMP to be done in one year by Government.

Building Materials, Construction Technology and Research & development:- In addition

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to land & infrastructure, building materials make up to 60-70% of overall cost of house.

There are about 44 research institution linked to research& development including

professionals in public and private sector. The main building components in production to

be increased & make it affordable for people including poor. Innovative material i.e.,

compressed mud brick (adobe) and ferro cement roofing system to be introduced,

(Housing Policy,2001). The Policy aimed a no of measures; a) consistency of building

components, using low cost & recycled material. (b) Upgrading construction methods

using research, training. (d) Encouraging use of traditional & indigenous building

materials (UN-Habitat, Pakistan, 2009; Housing Policy, 2001)

Low Income & Low Cost Housing:-The identification & provision of land on discounted

rate by provincial/local Government to development agencies & private developers on

condition that they will pass on that benefit to low income group. Housing construction on

plots up to 150 sq. yds & flats up to 1000 sq. ft shall be tax free. Cost effective standard

design to be encouraged for households of all income class.

Development of Intermediate /Secondary Towns:- Urbanization rate is about 3.5% to

4.5% per annum putting pressure on housing, & infrastructure of major cities.

Development of intermediate/ secondary towns & Industrial towns to be undertaken in the

country to reduce urbanization & creating employment generation (Housing Policy, 2001).

Only Public housing schemes are announced on ownership basis, that is out of reach of

poor and goes into the hands of speculators.(Zaman,2011) The share of rental housing was

around 22% (UN-Habitat, Pakistan,2009; Housing Policy, 2001; Population census,1998).

Not much achieved in implementing this policy. As per policy target, it has failed to

upgrade the slum areas& katchi abadis (UN-Habitat, Pakistan, 2009). The current 2001

policy needs to be updated with focus on affordable housing provision to the lower income

group with practical implementation measures.

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2.8.4 Affordable Housing in Pakistan

Pakistan is facing acute problem like, energy crises, water scarcity, adequate & affordable

housing and poverty & other environmental issues. There is a dire need to address these

issues through implementing the sustainable housing practices. This could be done by

upgrading the housing policy (Housing Policy, 2001), NRMPI (GOP, 1986), Zoning &

building regulations with specific needs of low income people &public participation for

effective policies with implementation process. In addition, provision of affordable land

and housing finances should be made mandatory with access to low income communities.

That should be affordable and in access of all income groups specially the poor.

Affordability is the issue, as 2/3rd of population can’t manage to pay for any housing

without financial grant & support (UN-Habitat, 2011, WB, 2009). In Pakistan the land

registration & titling process involves 17 agencies & six procedures. It involves 50 days &

costs 7.2% of property value to register a property. same is the case in India

&Bangladesh, which is higher in contrast to OECD countries, where it takes 25 days &

costs 4% of total value to register a property Punjab has initiated the computerization of

land records which is in process (UN-Habitat, 2011, WB, 2009) UN-habitat supported the

efficient land administration system through ERRA after 2005 Earthquake, where willing

sellers transferred the land administration system modified for its efficiency & reduced,

lengthy process and by 2009 about 8156 landless people has successfully owned the land

for housing (UN-Habitat, 2011). Poor construction quality is attributed to non-

enforcement of zoning & building regulations, inadequate supervision, poor quality

control and non-compliance of construction standards. Lack of most of the durable

housing is related to poor quality construction materials, and low level companies

involved. The rare practice of using robust and innovative/ appropriate low cost

technologies, is promoting high construction/maintenance cost and non-durable housing.

53

Very few examples of research on low cost housing technology are found in the country

(WB, 2009).

In Karachi due to building height restrictions, housing developers have violated the

regulations, for that, legal status of such projects is awaiting, which limits their financing

& interest in future housing projects (UN-Habitat, 2011). To achieve housing affordability

in Surjani housing project, Karachi, Farokh used Bertaud affordability model (Afshar,

1992). In its procedure, link between user affordability (affordable sale price) with sponsor

affordability (cost recovery), and link of standards, pricing, financing is important. One of

the options is by adopting, efficient land use planning i.e., standard circulation patterns

with minimum wastage of land, in a hierarchical manner and reduced street widths, shared

open spaces i.e., use of school ground for social gatherings/parking, reduced plot size, and

reduced %age of circulation standards. That results on per unit of land, an addition of plots

and decrease in land cost, reduced circulation space leads to more land available for

residential use, and increase in source of cost recovery. In other option, commercial plots

and upper income group plots are proposed on prime locations with sale price as per

market price, will result in maximum revenue, which in return will be used as subsidy for

lower income household plots thus reducing their land cost. Swathi-south project in

Peshawar is an example of such project (Afshar, 1992).

A case study of Karachi indicates that similar or even higher densities can be achieved in

a terrace house typology then mentioned in local planning regulations. As regards the

settlement & building design, this implies exploring the design options as per local

conditions &constraints. Other relying on repetition of same design throughout city. This

experience/study paves the way housing program options to enhance housing affordability

(UN-Habitat, 2011). Masharaka is a famous Islamic housing finance approach; in it the

54

consumer selects the property, signs an agreement with bank, & bank purchase the house

& lease it back to the household. The purchaser gradually procure units & become owner,

thereby reducing bank risk & down payment needs for households which is major hurdle

in housing finance. Between 2007-9 Islamic mortgage finance grew to 43% (UN-Habitat,

2011). The interim poverty reduction strategy paper (I-PRSP) proposed plans to allocate

shamlaat land (common land) to the homeless freely around villages and development of a

program for improving the living condition of katchi abadies/slum areas under National

housing policy. To attract investment in the housing industry, SECP & State Bank will

develop a new regulatory framework for housing finance (UN-Habitat, 2011).

The demand for land increased many fold in Karachi due to commercial project &

investment from foreign companies and by higher income household for housing & land.

The prices of land have risen to 500 times in five years. The attractive land sites are

acquired by private developers & developed for commercial purposes or hold

speculatively as prices of land keep on rising, most of land is public land and is leased out

to private & international developers under political pressure. Which means it is extremely

tough to acquire/develop land in such areas for low income housing and slums dwellers

are forced to evict. Informal markets in Karachi are richly organized, where land supply,

houses, credit, building materials & access to infrastructure services to the poor

unmatchable for affordability, with what formal sector can offer. The land grabbers take

possession of large pieces of land on periphery of city and after sub-divisions sell plots to

local households. Majority of the katchi abadis are on public land. There is no follow up of

any legal system or any official planning regulations but done with the confidence of

Government officials, bureaucrats/ politicians by way of bribes. Then after development of

these areas, locals with help of politicians get legal water, sewer network, electricity and in

some cases with help of NGO i.e; Orangi pilot project (OPP) (UN-Habitat & UNESCAP,

55

2008). In last two decades a lot of housing projects initiated by Federal and Provincial

Governments, and other autonomous bodies and private sector. Affordability and

sustainability remains the key issue in all the projects.

2.8.5 Low Income Housing Initiatives In Pakistan

There are rare examples in Pakistan related to low cost and affordable Housing, but still

some projects could be reviewed for initiating future projects with innovative approaches.

o Korangi Landi Township was developed in 1960 by GOP, in record time of 6 months,

to relocate informal settlers and poor, that was recognized internationally. The total unit

cost was Rs.35, to be paid in 3 installments (WB, 2009).

o Surjani Town Low cost housing was developed by KDA, in Karachi, in 1970; it

consists of 47736 plots with one to two room units. The approximate total unit cost was in

the range of Rs.450000/- to Rs.80000/- with 800 Sq.yds covered area. HBFC provided

financing and finally developed in 15 years (WB,2009).

o Khuda ke basti was developed by Saiban as incremental development project for

homeless and poor. The unit cost was about Rs.37000/- for 80 sq. yds., with down

payment of Rs.4000/- and be a deserving person for shelter. (WB,2009) In it, by reduction

in plot size from 3m to the base minimum, (but still a size that could be used for household

actions), plot cost decreased from 525 USD to 310 USD (UN-Habitat & UNESCAP,

2008), a 41% cost reduction, which leads to reduced construction cost of services. For

each plot by 44%, ultimately reducing overall cost of each housing unit. (UN-Habitat,

2011; Berner, 2010).

o Taiser Town low cost housing project was JV of CDG Karachi and US Company, The

size of unit was 80 sq.yds. The Project's objective was to offer low cost, affordable and

quake resistant housing to the poor with housing finance by HBFC & other private banks.

Its estimated cost was Rs.600/- per sq. ft. (WB,2009)

56

o Khuda ke basti Lahore has 460 units on 12 Acre area, each unit is 816 sq. ft costing

Rs.80000/- with down payment of rs.40000/- & remaining @Rs.1000/- per month

installments. The 70% financing by HBFC and remaining by Saiban. With interest rate 12-

13%.(WB,2009)

o HDA Incremental Development Scheme, Initiated in 1980 with community

participation and needy were asked to stay continuously at site and infrastructure was

developed as per household's priority in phases. Tanker water was supplied to site. While

who don't opt to stay will lose titles and ownership. An example of sites and services

successful project.(UN-Habitat & UNEscape,2008)

o Heritage Homes Lahore consists of 2500 units, initiated by private developers, as

sustainable housing Project. Unit area was 100 sq.yds, with cost of Rs.690000/-. The

house owners will be bound to live for min. 5 years. (WB, 2009)

o Ashiana Housing projects initiated by PLDC, across all the cities of Punjab with

objective to provide affordable housing to households earning up to Rs.50000/- per month

as total Household income. The unit area is 500sft to 800 sft and costing to Rs.12Lac to

Rs.16Lac, with 20% down payment and Rs.8000/- per month installment as per unit size

allocated to the household. (GOP-Punjab, 2014)

An example of affordable and sustainable urban development is OPP, Karachi, where

assessment says that the savings attained in Orangi squatter, in the planning, construction,

and repairs of sewerage system, has accounted for cost saving to 75%. This is an example

of community participation project initiative (Choguill, 1994; ADB, 2006; Mitlin, 2010).

Other such examples are Lodhran Sanitation Improvement Project, Lahore waste

management, Faisalabad Sewerage and water supply scheme, which led to community

satisfaction and improvement in water and sanitation with the help of donor assisted

NGOs (ADB, 2006).

57

Punjab Government has upgraded the land use and building regulations in 2010 for private

housing development, with limitation of 20% of total plots to be reserved for lower

income households. While a lot more improvement is required in regulations for provision

of affordable housing (Punjab rules, 2010). The draft National housing policy, 2013 is yet

to be approved. It states that Govt., will initiate Apna Ghar Housing projects for the

construction of 0.50 million units for low income groups/poor. (GOP, 2015)

Currently public departments involved in developing housing projects for Govt employees

and general public include PHA, Provincial PHAs, FGEHF, PGSHF, PLDC,OPF, PHATA

and city development authorities etc. While ERRA is providing housing to homeless and

units damaged due to disaster. While defense authorities have their own housing

departments developing housing for their employees. The beneficial group among the

general public is mostly the upper middle and higher income group. Ministry of housing

&works and provincial urban units along with planning commission is involved in policy

making and regulations for urban development projects including master plans, housing

projects etc. The CWHR is the only organization practicing research and development on

low cost construction technologies with limited resources which needs to be enhanced on

wider scale. Overlapping functions of various Govt. departments involved in housing

provision & policy mechanism are one of the main causes of housing deficit & slums.

58

Chapter 3

RESEARCH METHODOLOGY

Purpose of this chapter is to highlight the methodology adopted for research. Firstly

research design to be selected, then the instruments to be deployed for primary and

secondary data collection. Sampling techniques & sample to be selected for study and

finally how the collected data has been analyzed.

3.1 STUDY POPULATION

The sample population of this study was the households living in Murree urban area

within TMA limits. One member was selected from each household for collecting socio-

economic and other information through questionnaire. Both male and female households

participated in the study but the majority of the respondents were male.

3.2 RESEARCH DESIGN

Mix Method research has been adopted for the research study including the explanatory

and descriptive research, (Quantitative & Qualitative research).

3.3 DATA COLLECTION

Data has been collected from both primary and secondary sources. The purpose of the

survey is to assess the affordability of households regarding income, house price and

mortgage repayments. The data has been collected regarding the household's socio-

economic status, affordable access to land, housing, housing finance, materials. Further to

ascertain the availability of affordable housing and its requirements as per household's

need. Moreover structured interviews were conducted from various stakeholders.

59

Furthermore secondary data has been collected from research journals, journal articles,

reports, published documents etc., and from various relevant departments.

3.3.1 Primary Data Collection

Questionnaire and Structured Interview schedule have been used as instruments for

primary data collection. (Attached as annexure)

3.3.1.1 Questionnaire Survey

Through questionnaire survey, data has been collected from respondents regarding

different aspects of affordability i.e, social, economic, and institutional.

Social aspects data include Age, gender, household type, dwelling typeb(Flat, single

storey/double storey house) and size, location, no. of adults and children, education status,

marital status, access to education, health and parks facilities, access to employment

facilities etc. no of storey/no. of rooms, size of plot, covered area, condition of housing,

ownership status (tenant/owner), Tenure status (owned/legal or occupied/illegal) etc.

Economic aspects data include the employment status (employed/unemployed and

Government/private sector), household income (salary, pension, investment), rent,

mortgage finance/loan (total loan, no of installments, repayment installment, interest rate) ,

Land cost, house cost, repair & maintenance cost, Non-housing expenditures(Food,

clothing, education, health, transport, utilities etc), etc.

In institutional aspects the data includes the house/land, finance, institution's affordable

access, its terms, and location both in public or private sector, availability of technical

guidance, departments for construction and up-gradation of housing (TMA). Moreover

household's satisfaction level was assessed through questionnaire about unit location,

60

quality, cost, size, and quality of services & materials.

Figure 3.1: Research Methodology

3.3.1.2 Structured Interview

Structured interviews have been conducted from various stakeholders involved in the

housing sector. The purpose of that interview was to take their opinion about the

availability and requirements of affordable housing for the median to lower income groups

both in quantity and quality, i.e, availability of affordable land, housing finance and

housing (rental/ ownership basis)and building materials. The following type of

information has been collected during interviews; how such housing facilities could be

provided as per the needs of the poor at affordable price. Present policies and regulations

are fulfilling the requirements or what improvements/up-gradation is required for the

61

affordable housing provision. How the price of house/plot could be reduced through

design or use of appropriate materials. What financing mechanism to be adopted at

flexible terms to make it accessible to the poor. How much, the present housing projects

both in public and private sector are sharing to the provision of affordable/low cost

housing and what measures to be adopted for developing affordable housing projects at

location and price that is affordable for middle to lower income groups. The present output

and cost of construction materials is satisfactory or how it could be made accessible to the

poor. Katchi abadies and slum areas should be upgraded or shifted to other sites by

constructing affordable housing. What kind of housing will be most suitable for the lower

income groups including households of slum and katchi abadies, rental/ ownership basis,

apartments/row housing. The availability of trained and skilled professionals and labor in

housing industry is satisfactory or improvements required. What strategies to be adopted

to deal with the above mentioned problems?

The stakeholders include the professionals (Town Planners, Architects and engineers),

housing finance institutions(Public/private), HBFC, Khushkhali bank, NGOs, TMA, PHA,

developers, research scholars/ Institutes, consultants, construction Industry representatives,

ICCI, Land departments, Government departments, development authorities etc.

3.3.1.3 Secondary Data Collection

Secondary data has been collected from various Government departments, Population

census department, TMA Murree, EPA Punjab/Pak-EPA, and other Organizations. Apart

from that Murree Land use map, research reports, articles, and other secondary sources has

been used for data collection. The kind of data involves the population of city, urban

growth patterns, present housing stock and requirements, cost of land from real estate

62

market, cost of materials from suppliers, financing for housing its terms and availability

for poor(HBFC), location of new or planned housing projects from TMA.

3.3.2 Sampling Procedure

In order to obtain a well-distributed representative sample, urban area of Murree was sub-

divided into four sampling areas or zones. These residential zones/areas are Sunny Bank

(including Kuldana road, Motor Agency), Lower Bazaar (including Pindi point, Mall

road), Jhika Gali (including Kashmir point and MIT), and adjoining areas (Fig-3.2).

Figure 3.2: Murree city with location of residential areas

Simple random Sampling technique has been used to select the sample population and area

for study. A well-representative sample from each of this sampling area was collected.

For calculating the sample size of the population under study, following formula has been

used.

n = N/1+Ne2

Where n is the sample size, N is the population size and e is the margin of error.

63

Where (N= 28500 and e = 10%) ~ 100.

The confidence interval has been taken as 10%, while the estimated population of Murree

city is 28500 persons. The sample size is 100,, however, based upon the current

population and number of household in Murree city, the sample has been taken as 130.

3.4 DATA PROCESSING/ANALYSIS

The data has been processed & analyzed into an organized and presentable format, to

highlight the useful information. As my study is based on mix method research, it has been

analyzed using computer software i.e., SPSS, MS Excel, etc. Different Analysis has been

done i.e., using correlation analysis and SWOT analysis, need assessment of the

households for affordable housing, its related issues and standard deviation with mean of

economic variables for affordable housing provision, including income, rent, finance

facility, no of earners, plot price, non-housing expenses etc.

Analysis of the primary data has been done using descriptive statistics i.e, mean, median

mode. Correlation of affordability for social and economic aspects has been done i.e,

income to house price/cost, income to rent, income to mortgage repayment installment,

household size to income, education level to income. Secondary data analysis has been

done through content analysis.

64

Chapter 4

DATA COLLECTION AND ANALYSIS

4.1 MURREE CITY

Murree is one of the most scenic and beautiful cities of Pakistan, with rich natural

landscape, lush green valleys, snow covered mountains, springs, and wildlife. One of the

tourist cities and source of economic activities. It consists of hilly areas, valleys, riverines,

tough terrain/ topography. Murree is situated at an elevation of 7500 ft above sea level

(Nawz, 2001) having population of about 177000 persons as per 1998 census, (Population

census,1998) and spread over an area of 434 sq. km (GOP, Punjab, 2011). Murree is one

of the richest cities in receiving heavy rainfall/snowfall in Pakistan. Average annual

rainfall is 1500mm (GOP, Punjab, 2011; Metrology Deptt) with mean annual rainy days

85 and average snowfall is 5 to 6ft. (Nawz, 2001) the mean minimum & maximum

temperature is 31 to 80 degree F. (Nawz, 2001; Metrology Deptt) Many families opt to

live in Murree seasonally during summer season to enjoy cold weather, scenic beauty and

get themselves relived from hot weather, persistent in other parts of the country.

Murree city is becoming overcrowded with the influx of tourists especially during summer

season, who opt to live in multistory apartments or hotels. Many shopping areas, hotels

and recreational facilities have been developed (Golf course & Patriata resort etc), and a

source of attraction for tourists. The quantity of housing has increased over the time,

because of population growth and investment on part of Government departments and

private developers in development of military colonies, residential areas, and educational

centers. Many of these are seasonally occupied. Tourist population have increased

manifold due to the development of roads & infrastructure. An estimated 11000 tourists

65

visit and stay there during the peak season and holidays. (IUCN, 2005) Murree has

witnessed an increase in real estate development activities, which includes many housing

projects spreading from Murree hills to the periphery of Islamabad. Among these projects

are Bahria Golf city, judicial town, Utility housing, OGDC and PAEC housing projects.

The Cecil hotel has converted to multistory residential apartments. In Bhurban many

housing projects are under development including Bhurban continental luxury apartments,

and Bhurban valley view apartments (IUCN, 2005). Due to the inefficiency of relevant

authorities, these developments are violating the zoning, building and environmental

regulations. However such housing developments are neither affordable, nor sustainable.

Like other cities, there is lack of adequate & affordable housing and poor system of water

and sanitation. There is no wastewater and solid waste management system. Partly waste

is carried off by rainwater runoff to the down slopes of Rawal Lake (IUCN, 2005). Most

of the housing located along the valleys and hillside slopes face the land sliding hazards

due to heavy rainfall and have to spend most of their income on repair and recovery. Land

sliding damages the housing, infrastructure and livelihoods which in turn affects the safety

of life and property (Nawz, 2001).

4.1.1 Population and Major residential Areas of Murree

The Population of Murree urban area was 177000 persons in 1998 including cantt area,

while the population of Murree urban area under Tehsil municipal limits was 13975

persons (GOP, Population census, 1998). Current population is 28500 persons. The major

residential areas of Murree urban area are Lower Bazar, Kashmir Point, Pindi point, Sunny

bank, Murree improvement trust colony, Jhika Gali, Motor Agency, and other small

adjoining areas etc.

66

4.2 RESIDENTIAL AREAS SURVEY

Household surveys were conducted using Questionnaires for primary data collection.

Simple random sampling technique was used for sample survey. And about 130

Households were surveyed as sample size. The major Areas in Murree that were surveyed

are Sunny Bank (including Kuldana road, Motor Agency), Lower Bazaar (including Pindi

point, Mall road), Jhika Gali (including Kashmir point and MIT), and adjoining areas.

Table 4.1: Locality (Major Residential Areas of Murree Urban)

Residential Area Frequency (f) Percent (%) Lower Bazaar 33 25.4

Sunny Bank 25 19.2

Jhika Gali 23 17.7

Adjoining Areas 49 37.7

Total 130 100.0 Source:-Field Survey

Figure 4.1: % Age of respondents/Samples from Residential Areas of Murree

About 25% of the survey sample was conducted in Lower Bazaar, 19% in Sunny Bank,

18% in Jhika Gali and 38% in other adjoining areas. The respondents belong to various

cultures and socio-economic status. Most of the residents in Murree are seasonal, as they

stay during summer season and go back to their hometowns in winter/cold season. So

during winter season these houses or flats remain vacant or being used by servants.

67

4.3 HOUSING DEMAND AND SUPPLY IN MURREE CITY

The Population of Murree was about 27000 persons in 2013, while it was 13975 persons

in 1998. The average household size is about 6. The total housing units in TMA limits of

Muree were 2088 in 1998 (Population Census, 1998; GOP, Punjab; 2013), presently the

total estimated units are 3000. Most of the housing units are in substandard condition with

poor infrastructure especially in Lower bazaar area and Sunny bank. The major urban

settlements are Lower bazaar, Kashmir point, Jhika Gali, Motor Agency, Sunny bank,

kuldana road, Pindi point, MIT and other adjoining areas. The housing situation in areas

like sunny bank and Lower bazaar is in dilapidated condition and densely populated as

slums. Overall there is a shortage of 1750 housing units in Murree.

Furthermore the ban on housing construction by Punjab Govt, in 2011 to present has

further increased the housing shortage and propelled the growth of slums around Murree.

Households engaged in construction industry remain jobless further aggravating their

financial problems in addition to shelter issues.

Table 4.2: Population and Housing Units-Murree City

Year 1981 1998 2013 2015 Description Population 10744 13975 27000 28500 Household Size 6.2 5.8 6.0 6.0 Population

Growth rate 1.56 1.56

Housing Units 2088 3000 Housing demand

(Per annum units) 66

Housing shortfall (units)

1750

Source:-GOP-Population census,1998;Punjab statistical Data-2013, TMA-Murree,2015

The factors behind rising demand and supply gap are construction ban, lower income i.e,

Due to lower income most of households can't improve their housing neither can move to

68

other locations, lack of Govt initiatives to control rent & develop affordable housing, ban

on housing loan/mortgage finance & interest rates, higher land cost, topography, tourists

& seasonal residents, lack of institutional measures, regulations.

4.4 SOCIAL ASPECTS

Survey on Social aspects/variables involve, household size, gender, age group, education

level, ownership status, employment status, plot/unit size, access to facilities, dwelling

type/condition, repair/maintenance of units etc.

4.4.1 Socio-Economic Status of Households

As shown in tabel-4.2, the average household size in lower bazaar is 6.52, with average

3.76 males and 2.76 females, median age of the household head is between 40-60 years,

while the median education level is metric.

Table 4.3: Socio-Economic Status of the Households

Locality No. of respondents (Frequency)

Average Household Size

Gender (Average)

Age (Average)

(HHH)

Median Education Level Male Female

Lower Bazaar 33 6.52 3.76 2.76 54 Metric

Sunny Bank 25 8.17 4.36 3.77 50 Bachelor / University

Jhika Gali 23 6.09 3.00 3.25 47 Secondary Adjoining Areas 49 5.96 3.07 2.76 51 Secondary

Source:-Field Survey

In sunny bank area, the average household size is 8.17 with 4.36 males and 3.77 females,

median age 40-60 years and median education level is bachelors/university. In Jhika Gali

area, the average household size is 6.09 with 3 males and 3.25 females, median age as 40-

60 years and median education is secondary. In other adjoining areas, the average

household size is 5.96 with 3.07 males and 2.76 females and 40-60 years is the median

age, while median education is secondary level.

69

Table 4.4: Household Size Size Frequency Percent 2.00 3 2.3 3.00 8 6.3 4.00 14 10.9 5.00 28 21.9 6.00 23 18.0 7.00 17 13.3 8.00 11 8.6 9.00 10 7.8

10.00 4 3.1 11.00 5 3.9 12.00 3 2.3 15.00 1 .8 30.00 1 .8 Total 128 100.0

Figure 4.2: Trends in Household size

Figure 4.2, shows the household size in overall Murree city.

4.4.2 Employment Status

Table 4.5: Employment Status

Status Frequency Percent Self Employed 29 22.3

Private 46 35.4 Unemployed 11 8.5 Govt. Deptt 30 23.1

Retired 3 2.3 Daily Wages 10 7.7

Other 1 .8 Total 130 100.0

Source:-Field Survey

Figure 4.3: %Age of Respondents with Employment

Status

In Murree city, about 8.5% of the respondents were unemployed, while 2.3% retired from

Govt/Private Deptts and 89.2% were employed in various fields. About 35.4% were

working in private sector, 23.1% in Govt. deptt and 22.3% were self employed. 7.7 %

were working on daily wages.

4.4.3 Ownership Status

The ownership status of the household's survey reveals that about 57.4% of the households

are owners of their dwellings, 26.4% of the respondents were tenants, while 7.8% living in

3

8

14

28

23

17

11 10

4 53

1 10

5

10

15

20

25

30

0.0

10.0

20.0

30.0

40.0

22.3

35.4

8.5

23.1

2.37.7

.8

%A

ge

Employment StatusEmployment Status

70

inherited houses, and 7% living with parents (Table-4.6 & figure-4.4). The analysis shows

that major component of households are living in rental units due to various reasons, i.e.,

Table 4.6: Ownership Status

Status Percent Owner 57.4 Tenant 26.4 Inherited 7.8 Leased 0.8 Living With Parents

7

Other 0.8 Total 100

Source:-Field Survey

Figure 4.4: %Age of Respondents with Ownership Status

lacking finances for shifting their status from rental to owner, no savings due to high rate

of non-housing expenses in overall income they earn.

4.4.4 Plot/Unit Size

As per the household survey, major part (about 74%) of the respondents were living in

Table 4.7: Size of Plot/flat (In Sq.ft)

Size Range Percent 700 or lesser 22.7

800-1200 32.8 1300-1800 18.8 1900-2500 7.8

2600-3200 8.6 3300-4500 7.0

others 2.3 Total 100.0

Figure 4.5: % of Respondents living in plot/unit with Size

/Area

1800sqft House/flat or lesser, (about 6.5marla & less-based on 272sft for one Marla)

which shows that the households are forced to live in congested/overcrowded housing, due

to low income and high land & construction cost.

0.0

10.0

20.0

30.0

40.0

%Ag

e

Size Range(Sq.ft)

Size of Plot/flat (In Sq.ft)Size of Plot/flat (In …

71

Out of that 22.7% were living in 700 sq. ft or less area,(about 2.5marla) while 32.8% were

living in houses/units with areas ranging from 800 to 1200sft, and 18.8% of the

respondents were living in units with area range of 1300 to 1800 sq. ft.

4.4.5 Respondent's choice of Ownership status

Source: Field Survey

Table 4.8: Preference Of Ownership Status

Type of shelter

Percent

Ownership 78.0

Rental 22.0 Total 100.0

Figure 4.6: % of respondent's willing for house/unit on

ownership/ rental basis

When asked about the future options, whether they will prefer rental housing or on

ownership basis in future housing projects, 78% shown their willingness to buy on

ownership basis while 22% were interested in rental units (Figure-4.6 & table-4.8).

4.4.6 Respondent's choice of Shelter Type

When respondents were asked about their opinion on type of shelter they will prefer to live

Table 4.9: Preferred Shelter Type

Type Of Shelter %Age Demand Flat 24.0 House 76.0 Total 100.0

Source: Field Survey

Figure 4.7: % of respondent's willing for house/unit on ownership/ rental basis

in, about 24% of the respondents shown their interest to move to flats if offered in future

housing projects, and 76% of them were desirous to have a house.

72

4.4.7 Proximity/Accessibility to Various Facilities

As the Murree city is located on hills and tough terrain, it is easier to walk then to move by

transport within the city's adjoining areas as narrated by the residents. They are use to

walk in such steep slopes up & down. Table-4.10; illustrates the average distance travelled

Table 4.10: Average Distance Travelled to avail the facilities(In Kms)

Locality Employment School Health Shopping Recreatio

n

Lower Bazaar 5.23 1.83 2.65 1.45 3.20

Sunny Bank 2.10 1.21 1.87 1.49 .61

Jhika Gali 10.41 3.12 3.59 3.07 2.34

Adjoining Areas 5.06 2.38 3.33 2.84 1.78

Source: Field Survey

Figure 4.8: Average distance travelled by the household to avail various facilities

(in kms) by the households to avail various facilities in the city. Most of the respondents

said that there is no park/playground near about, only the views and recreational spots

developed for tourists, are the only recreational sites for them. The households of lower

bazar has to travel 5.23km to their work place, their children travel 1.83 km to attend

school either by walk or public transport. For health facilities they

0.00

5.00

10.00

15.00

Dist

ance

in K

ms

Facilities

Average Distance Travelled to avail facilities(Kms)

Lower Bazar

Sunny Bank

Jhika Gali

Adjoining Areas

73

travel 2.65 km, for shopping 1.45km and for any recraetional activities 3.20km. The

households of sunny bank travel 2.10km for their jobs,1.21 km for school, 1.87for health

and 1.49km for shopping and 0.61km for recreational activity. While the repondents of

jhika gali said, they have to travel 10.41km for jobs, school facility is at 3.12km, for health

3.59km, for shopping 3.07 km and 2.34 km for recreation. Similarly the housholds of

adjoining areas describe that on average they travel 5.06 km for job, their children travel

2.38 km to attend school, for health, shopping&recreation 3.33, 2.84&1.78km

respectively.

4.4.8 Age of Buildings/Units

Lower bazaar is high density slum area, with poor condition of housing and infrastructure.

the avearge age of the building is 43.50 years old, while the houses in sunny bank area are

Table 4.11: Average Age of Building (In Years)

Locality Age in Years Lower Bazaar 43.50

Sunny Bank 14.00 Jhika Gali 13.01 Adjoining Areas

18.65

Source: Field Survey

Figure 4.9: Average Age of buildings in different localities

14 years old on average. Sunny bank also a slum area with poor construction and

infrastructure facilities. The respondents of Jhika Gali descirbed that their houses are 13

years old on avearge. While only MIT (Murree improvement trust housing scheme) is the

recently planned scheme with good construction and infrastructure facilities, but out of

reach of the poor households. The houses/units in adjoining areas are 18.65 years old.

43.50

14.00

13.01

18.65

Average Age of Building(years)

Lower Bazar

Sunny Bank

Jhika Gali

Adjoining Areas

74

4.4.9 Dwelling Type & Condition

Survey of dwelling condition reveals that about 70.8% of the housing units were pacca and

Figure 4.10: % Age of dwellings with Type & Condition

29.2% were semi-pacca. While Type of dwellings survey describes as 15.4% of the units

are detached and 84.6% are semi-detached. About 45% of the housing units consist of 2-3

bedrooms, 5.2% with one bedroom, while 35% have 4-5 bedrooms, rest of the units have

more than 5 bedrooms

4.4.10 Repair of Houses/Units & Reasons As per survey about 64% of the households repair their units at least once a year, while

Table 4.12: Reasons for Repair &Maintenance of

Units Reason %Age

N/A 2.4 Family size 20.2 Finance issues 9.7 Poor Construction 27.4 Damaged in any hazard 33.9

other 6.5 Total 100.0

Source: Field Survey Figure 4.11: Reasons for repair/maintainance of

units

0.0

20.0

40.0

60.0

80.0

100.0

Pacca Semi Pacca

detached semi detached

Perc

enta

he o

f Dw

ellin

gs

Type &Condition

Dwelling Type & condition

Pacca

Semi Pacca

detached

semi detached

2%

20%

10%

27%

34%

7%Reasons for Repair/Maintainance

N/A

Family size

Finance issues

75

about 12% do once in two years, and rest of the households keep on repairing more than

once a year. About 27% of the respondents do the repairs due to poor construction, 34%

repair are due to damages occurred in any hazard (Snowfall, rains, land sliding,

earthquake), while 20% claim that due to growth in family size they go for improvement

or extension. And 10% go for repairs, as incremental improvements, due to shortage of

funds as they can't construct their shelters in one go.

4.5 ECONOMIC ASPECTS

4.5.1 Household's Average Income;

Table 4.13, shows the income ranges for various households in Murree areas. Most of the

respondents were found working in private sector or self employed either in hotels or

Table 4.13: Household's average Monthly Income

(In Rupees)

Income range %Age

8000 or less 3.1

8000-13000 6.9

13000-18000 11.5

18000-25000 23.8

25000 -30000 21.5

30000 and above 33.1

Total 100.0

Source; Field Survey Figure 4.12: Household's Average monthly income

restaurants. The respondents are reluctant to disclose their actual household income due to

many reasons. It is evident from the survey results that nearly half (about 45%) of the

households are earning less than Rs.25000/- per month and only about one third (about

33%) are earning more than Rs.30000/-per month. While nearly one fifth (21.5%) of the

3% 7%

12%

24%

21%

33%

Household's average Monthly Income (Rupees)

8000 or less

8000-13000

13000-18000

18000-25000

25000 -30000

30000 and above

76

households income ranges from Rs.25000 to 30000/-per month. 3.1% of the respondents

are earning Rs.8000/- or lesser per month and 6.9% of the household's monthly income

ranges from Rs.8000/- to Rs.13000/- per month. The 11.5% of household's monthly

income ranges from Rs.13000/- to Rs.18000/-per month.

The overall income of the households shows that it is extremely difficult for most of the

families to meet their daily needs within these incomes. For that reasons they are living in

overcrowded and dilapidated buildings and can't find the alternate shelter. Moreover the

housing finance is banned in that area and construction is also banned for unlimited time

that prohibits the households to even find alternate solutions through seeking financial

help from their relatives/friends as revealed by the respondents. And there is no new

housing project specifically targeting the poor households.

4.5.2 Non-Housing Expenses;

Table; 4.14, shows the average monthly non-housing expenses that the households have to

meet their daily living needs. Non-housing expenses includes the expenses incurred on

food/ kitchen items, clothing, healthcare, education, utility bills, general repair &

maintenance and transportation costs associated with travelling for availing various daily

activities i.e., health, shopping, education, job, recreation etc. Average food/kitchen

expenses of household in the lower bazaar area is about Rs.16000/- per month, about

Rs.1300/- for clothing, Rs.1000 for healthcare, Rs.4700 for education and Rs.3800 for

utility bills, Rs.1500/- for repair/ maintenance & Rs.1600/- for transportation. So the total

Monthly non-housing expenses are Rs.30000/- for a household family. The total such

expenses for households in Sunny Bank area are Rs.41000/-per month, with Rs.21000/-

for food/kitchen items and Rs.5000/- & Rs.5400/- per month for education & utility bills

respectively. The total expenses of households in Jhika Gali area are Rs.25000/-per month

with Rs.13000/- for food/kitchen alone, and Rs.3300/-& Rs.2800/- per month for

77

education and utility bills. In the adjoining areas the total expenses incurred by the

households for these activities are Rs.28000/- including Rs.15000/- for kitchen/food items.

The table and graph shows the overall picture for non-housing expenses.

Table 4.14: Non-Housing Expenses (Average Monthly In Thousand Rupees)

Locality Food/ kitchen Clothing Health

Care Education Utilities Bills

Repairs/ maint- enance

Transpor-tation Total

Lower Bazar 16.11 1.33 1.09 4.74 3.86 1.55 1.63 30.31

Sunny Bank 21.26 2.33 1.85 5.04 5.43 2.40 3.19 41.52

Jhika Gali 13.55 1.91 1.40 3.36 2.89 .78 1.55 25.44

Adjoining Areas 15.30 3.43 1.55 2.66 2.93 .95 1.92 28.74

Source;- Field Survey

Figure 4.13: Average Monthly Non-Housing Expenses in various localities by Households

The major portion of non-housing expenses is consumed by food/kitchen items, which is

essential for human survival. It becomes extremely challenging for poor and middle

income households to save for housing improvement or expansion. So mortgage finance

becomes important to assist such families to have adequate housing.

0.00

5.00

10.00

15.00

20.00

25.00

Expe

nses

in T

hous

and

Rup

ees

Non-Housing heads

Non-Housing Expenses (Average Monthly in thousand Rupees)

Lower Bazar

Sunny Bank

Jhika Gali

Adjoining Areas

78

4.5.3 Rent of the Unit/House

The average rent paid by tenants varies from Rs.30000/- to Rs.120000/- per annum

depending upon the covered area, location and quality of the unit. Most of the households

pay rent from own sources, while part of the households are availing that facility from

employer or assisted by friends/relatives. Out of the total sample 31 respondents were

living as tenants, their rent analysis is given in table-4.15 & Fig-4.14.

Table 4.15: Rent Paid by the Respondents (Annual in

thousand Rupees) Annual Rent in

Thousand Rupees %Age of

Respondents

20 and below 6.5

21-45 16.1 45-70 16.1 71-95 19.4 96-120 25.8

121-150 12.9 151 and above 3.2

Total Tenants(31) 100

Source-Field Survey Figure 4.14: Average Annual Unit Rent in thousand Rupees

4.5.4 Market rate of the Unit/House

Overall analysis of survey shows that the market rate of new units/house is too high to be

afforded by poor or low income group. About 8.1% of respondents describe the market

rate of their unit is 10Lac rupees or below, while 22.5% said that the market rate of the

unit ranges from 10-25 Lac rupees. Nearly 17.8% describe it in the range of 25-40Lac

rupees and 14.7% say the market cost of the unit lies between 40-55 Lac rupees. About

1/3rd (29.4%) did not know about the market cost of the unit/house. The higher the price of

the unit the less will be the affordability and lower the unit price, higher will be

affordability for most of the lower middle income and poor households. The land cost and

6.5

16.1

16.1

19.4

25.8

12.9

3.220 and below

21-45

45-70

71-95

96-120

121-150

151 and above

79

cost of building materials are the main components in a house construction cost.

Figure 4.15: Average Unit/House Cost in thousand Rupees

Table 4.16: Land Cost in various Residential areas of Murree

Main Locality/Area Adjoining areas to Main Locality

Average Cost per Marla ( in Thousand Rupees)

Sunny Bank Sunny Bank 350 Pindi Point 450 Kuldana Road 400 Motor Agency 450

Lower Bazar 500 Jhika Gali Kashmir Point 600

MIT Colony 400 Source:-Field Survey

As per stakeholders interview, & respondents survey, the per Marla land cost in different

localities ranges from about Rs.250000/- per Marla to Rs.450000/-. And construction cost

varies from Rs.1000/ sq. ft to Rs.1500/- per sq. ft for median to average level construction,

but still a decent living. It results in average minimum cost of unit @Rs.2000/- per sq.ft

(Including Land& construction cost) for owning a house excluding external infrastructure

development cost, that is far from affordable cost, for most of the households.

4.6 HOUSING FINANCE/LOAN

When asked about whether the households have ever taken housing finance from banks or

private organizations, about 4.6% of the households responded in positive as they have

0

10

20

30%

Age

of R

espo

nden

ts

Unit Price(Thousand Rupees)

80

availed the facility, while majority of them (95.4%) did not avail that facility due to many

reasons. The households reveal that the housing finance is banned in Murree as most of

the borrowers have not returned the finance which was borrowed either for business or

housing purpose. So they defaulted. As it is of extremely useful for the poor to construct

or improve their housing units.

4.6.1 Problems in Availing the finance

In Table-4.17: the household's survey results have been tabulated, as when they were

asked about the kind of hurdles/issues they faced in availing the mortgage finance for their

housing. About half (40.2%) of the respondents describe that the non-Islamic terms is the

Table 4.17: Problems For Availing/ Not Availing The

Finance Facility

Factors %age N/A 6.3

Non-Islamic Terms 40.2

High Interest Rate 17.3

High Down Payment .8

Installment Cost too high .8

Tight Installment Period .8

Lack of Knowledge 4.7

No Guarantor 3.1

Ownership proof 2.4

Proof of income .8 Low Income for repayment 3.1

Lengthy procedures 15.0

Others(Pls specify) 4.7

Total 100.0 Source-Field Survey

Figure 4.16: Problems faced by Households in accessing

Finance

major hurdle in availing the finance, 17.3% of the respondents said high interest rate is key

issue in getting the mortgage, 15% of the respondents said the lengthy procedures are main

6%

40%

17%

1%1%

1%5%

3%

2%

1%

3%15%

5%

Problems for availing/ not availing the finance facility

N/A Non-Islamic TermsHigh Interest Rate High Down PaymentInstallment Cost too high Tight Installment PeriodLack of Knowledge No GuarantorOwnership proof Proof of incomeLow Income for repayment Lengthy proceduresOthers(Pls specify)

81

problems in applying the loan, while 4.7% reveal as, lack of knowledge about its

procedure is their issue, 3.1% of respondents said the absence of guarantor and low

income for repayment are the main problems for them, likewise rest of the respondents

indicated their issues as indicated in table and figure. So the overall survey results reveal

that the housing finance institutions and policy makers should address the major issues

faced by the households in availing that facility, the key one making it Islamic terms and

interest free with easy installments& terms, making it convenient for the communities

specially the poor.

4.6.2 Willingness/Need for Housing Finance

When the respondents were asked about their need/willingness for housing finance to

upgrade their house/unit or construct the unit, most of them (58.6%) responded positively

Table 4.18: Households

Needing Housing Finance

Needed Percent Yes 58.6 No 41.4 Total 100.0

Source-Field Survey

Figure 4.17: Households need House

finance

i.e., shown their willingness for housing finance if offered in easy terms & conditions and

Islamic mode of financing and only 40.8% said they don't need it. While out of 41.4%

many describe the loan as un-Islamic and too much lengthy procedure.

4.6.3 Required Amount of Housing Finance

The Finance requirements vary from family/household to household depending upon

purpose of finance and covered area required to be improved/constructed. Mostly (43%) of

the total households were not willing to avail loans even if the terms are relaxed. About

82

8.5% of the respondents require only 3Lac rupees or fewer amounts for the

improvement/construction of the unit, while 12.3% need 3-6 Lac rupees for that purpose

and majority of it (15.4%) require 6-.10 Lac rupees for renovation/construction purposes.

Figure 4.18: The Range of finance required by the Households for construction/improvement of the unit

About 6.9% need 10-16 Lac, 3.1% need 16-25lac and 10% require more than 25Lac

rupees for improvement/construction of their units. The analysis of the results shown

graphically in figure-4.18.

4.6.4 Repayment Affordable Amount

After showing their need for finance and describing the purpose and amount required for

Table 4.19: Repayment Amount affordable for

Respondents

Monthly Installment (thousand Rupees)

%Age

3 and less 21.1 3--7 46.1 7--12 17.1 12--20 7.9 20 and above 7.9 Total 100.0

Source-Field Survey Figure 4.19: Repayment Installment affordable for the respondents

their unit/house construction/addition or improvement, the respondents were asked, as to

how much they can repay as per their income levels, the results for that are given in

0

50

%Ag

e of

Res

pond

ents

Finance required(Thousand Rupees)

Finanace Required

0.0 20.0 40.0 60.0

3 and less

3--7

7--12

12--20

20 and …

%Age of Respondents

Rep

aym

ent M

onth

ly

Inst

allm

ent

(in

thou

sand

Rup

ees)

83

table,4.19 and shown in figure-4.19. Majority of the respondents (about 46.1%) revealed

that they can repay 3-7 thousand per month as per their affordability/savings and income

levels, while nearly 1/3rd said they can repay three (3) thousand and less. About 17.1%

said 7-12 thousand rupees as their repayment amount and 7.9% expressed their views the

repayment will range from 12-20thousand rupees and the same percentage of respondents

said 20 thousand and above will be affordable for them as repayment installment.

4.7 INSTITUTIONAL ASPECTS

4.7.1 Household Satisfaction over Building Materials/Technical assistance

Table 4.20 & Figure-4.20 shows that about 21.5% of the repondents believe the cost of

building materials is affordable while 78.5% of the respondents said it is not affordable.

Similarly 6.9% of the respondnets said they have recived some assitance for housing

repair/improvement and on procedures for approval of buildings plans, while 93.1% of the

respondents did not receive such assistance.

Table 4.20: Satisfaction on Building materials/ Technical

assistance

Opinion Cost of

building material

Technical/Legal

assistance Yes 21.5 6.9 No 78.5 93.1

Total 100.0 100.0 Source-field Survey

Figure 4.20: Satisfaction over Building Materials/

Technical Assistance

4.7.2 Causes for Lack of affordable Housing Units

During the survey the respondents were asked as what are the causes of non-affordable

housing provision in Murree, which has been illustrated in tabel-4.21 and figure-4.21. Its

analysis show that 18.5% given the reason as lack of initiatives from Govt., while 44.6%

21.56.9

78.5 93.1

0.020.040.060.080.0

100.0

Cost of building is affordable

Technical/Legal assisstance received

from any Govt/Private organization

Yes

No

84

said excessive land cost is the main reson, 27.7% given the reason as tourist city, 2.3% say

non-availability of housing loans are main hurdle, and 6.9% given other reasons.

Table 4.21: Causes making housing un-affordable in Murree

Causes %Age Lack of Initiative from Govt.

18.5

Non-availability of Housing Loans

2.3

Excessive Land Cost 44.6 Tourist City 27.7 Other 6.9

Total 100.0 Source-Field Survey

Figure 4.21: Causes for Un-Affordable housing in

Murree

4.7.3 Causes for less-Affordable/High Unit Rent

Respondents were also asked about the causes of high unit rent with options given as

illustrated in table,4.22 &figure-4.22. About 44.6% of the respondents said shortage of

housing is the key cause for high rent, while 11.5% opined the reason that absence of

Govt., regulations to control rent, 36.2% respondents were of the view that influx of

tourists is raising the rent, 2.3% say the ban on construction activity is the resaon, while

5.4% given other reasons.

Table 4.22: Causes for High Housing Rent in Murree

Causes %Age Shortage of Housing 44.6 Absence of Govt. regulations to Control House Rent 11.5

Tourists influx growing 36.2 Ban on Construction by Govt 2.3 Other 5.4 Total 100.0

Source-Field Survey

Figure 4.22: Causes for High Unit Rent

18%2%

45%

28%

7% Causes for un-affordable HousingLack of Innitiative from Govt.

Non-availability of Housing LoansExcessive Land Cost

45%

12%

36%

2%5%Causes for High Housing Unit Rent

Shortage of Housing

Absence of Govt. Regulations Tourists

85

4.8 SWOT ANALYSIS FOR PROMOTING THE AFFORDABLE HOUSING UNITS

Table 4.23: SWOT Analysis for Promoting Affordable Housing in Murree

STRENGTHS

• Strong socio-demographic factors

(Household size, employment,

Education)

• Availability of land

• Tourism city

• Government Interest and conducive

environment for public housing finance

• Availability of trained professionals

in housing and construction industry

WEAKNESSES

• Low accessibility of public facilities

• Seasonal availability of materials

• High cost of construction(labor, materials)

• Trained labor shortage

• Low household income and savings

• High land price

• Land development Institutional limitations

• Lack of community participation

• Topographical Constraints

OPPORTUNITIES

• Sustainable & livable communities

• Reduction in growth of Slums/Katchi

Abadies and slum upgradation

• Reducing Homelessness

• Increase in communities’ satisfaction

• Socioeconomic uplift of area and

communities

• Promotion of cheap Tourism services

• High Tourism potential

THREATS

• Environmental

consequences(deforestation)

• High pressure for new and improved

Infrastructure

• Consistent increase in real estate

price(property value boom)

• Conversion of Landuse

• Urban Sprawl

• Low interest of private investors in

affordable housing projects

• Frequency of natural hazards

The above table shows the SWOT analysis for encouraging affordable housing in Murree.

The major weakness in this process could be managed by adopting measures such as

improving accessibility to public facilities, it is necessary to prepare a master plan

including the proposed housing and up-gradation of existing residential areas. The public

facilities could be proposed at accessible locations with paths and efficient public

86

transport. As the Murree is located on a hilly terrain, it makes more difficult to walk or run

public transport. So the natural topography should be followed in proposing the

paths/streets for convenient access. Existing streets should be rehabilitated for walking and

transport with drainage and other infrastructure.

As the construction materials has to be transported in from far off locations & due to

difficult terrain it makes more costly to transport it to city. To reduce its cost, Govt should

provide subsidy to the relevant construction industry and tax rebates to make it affordable

for middle & lower income group. During the snowfall season/monsoon it becomes even

more difficult to transport the construction material, rather construction activities are

reduced during that season.

Trained labor shortage could be managed through vocational training of laborers in

affordable housing construction & its techniques. Moreover by promoting incremental

housing, with small financing facilities, which has also been the trend in most of the poor

income households, the households got themselves involved in construction, so they

become trained by time. The poor and lower middle income group could hardly save any

money to improve their housing or construct a house as per their desires. To overcome that

crucial weakness, it is necessary to create income generating activities and provide

training for various skills in addition to tourism industry. Housing finance facility to be

improved with easy & affordable access and flexible repayment installments should target

the poor & low income group.

The cost of construction is not affordable for most of the household including the material

& labor cost. The Professionals & Manufacturers are required to introduce cost effective

construction materials and economical designs to reduce the construction cost. The labor

cost could be reduced by extending training to the poor households which lead to income

87

generating activities, fulfilling labor shortage, and reducing overall labor cost. Moreover

Govt should provide the subsidy on construction materials to encourage affordable

construction for the lower income community, providing incentives to manufacturers, like

tax rebates could further reduce the cost in the field of affordable housing.

Govt should announce the new housing projects in vicinity and Land cost to be controlled

through a policy with non-transferable plots from poor, once allotted to them to manage

the high construction cost-training the households for construction techniques and

adopting cost effective designs by professionals could reduce the labor and overall

construction cost. Furthermore Islamic financing with easy terms of repayment could be

extended for incremental housing. Moreover ban on construction should be removed to

increase the employment and reduce rent & land prices. High rents are due to the influx of

tourist, ban on construction, absence of rent control policy and shortage of housing.

Developing new housing projects and rental low rise apartments, and a rent policy should

be enacted with affordability as the key factor. Moreover high land prices motivate

households to move to katchi abadies/slums, where they own their unit or opt for rental

accommodation at affordable cost, that leads to the growth of slums & squatter

settlements.

Weak policies/regulations are giving rise to slums and katchi abadies. The overcrowded

housing is resulting in unhygienic environment for households. The regulations should be

enforced and encouraging for affordable housing, Promoting more smaller plots, planned

schemes and properly design plans/structures and infrastructure with accessible facilities

including playing areas, schools and social activities. Geotechnical investigations should

be done by TMA for multiple dwellings, so that its cost and time could be saved on part of

households and structures will be hazard resistant. Moreover, in zoning regulations space

88

for the 2% Graveyard to be omitted by offering Land in the nearby for such activity by

Govt, and developers to be asked to reserve that space for poor households for their

housing. Capacity building through training of staff and professionals to improve their

efficiency in the affordable housing provision and policies. Development fee needs to be

reduced with flexible approval process, as incentive/encouragement for those developers

offering affordable housing Projects.

Land registration and titling process need to be focused with affordable and transparent

access for all income groups, and reducing the fees & no. of steps involved in transfer &

registration process. Land information should be computerized as the Govt is doing that

activity, but still way behind, which needs to be expedited. Security of tenure is an

important aspect for affordable housing. As the households get the tenure status security

(ownership), they tend to construct/improve their housing incrementally either by

family/friends assistance or formal financing through banks. Govt should provide the

tenure security to the poor households in order to manage growing housing shortage &

poverty among the poor communities.

Non-Islamic financing should be made shariah compliance with interest free loans with

affordable access. For that Govt with the assistance of SBP, Planning commission and

professionals can come up with amicable solutions. Community participation should be

encouraged and their opinions to be included in making policies & regulations and in

planning new housing projects with housing finance policies. One of the most critical

issue in Murree city is the tough topography/terrain that results in reducing Land

utilization and accessibility to other areas for households. For such issue, the Master Plans

should be designed with maximum utilization of topography with preservation of natural

terrain.

89

Threats

To avoid Environmental consequences, overall EIA to be conducted with

recommendations of STP, preservation of trees, natural topography, and Roof water

harvesting & RWH, public transport & energy efficient building designs. High pressure

for new and improved Infrastructure could be managed by improved public transport,

encouraging roof water harvesting; it will reduce pressure on water and drainage system

and sewers. Use of electricity could be reduced by adopting energy efficient designs/using

natural light & ventilation.

The main cause for consistent increase in real estate price is speculation that needs to be

discouraged through imposing fines for holding vacant plots for fix time period. The

Projects specifically developed for Poor households should target that community with

willingness to live there and non-transferable property rights to be enforced through

legislation/regulations.

Conversion of Landuse /Illegal commercialization could be discouraged by adopting strict

regulations in landuse planning and its enforcement with penalties. The change in Landuse

could be discouraged through zoning regulations up-gradation and its enforcement in

transparent manner. Favoritism/monopoly in allotment to be managed through a

transparent system and using computer technology with public participation.

Urban Sprawl is the result of improper planning, poor governance system and weak

policies, which are required to be improved with better Master plans, governance system

and policies. High density development to be encouraged with incentives in development

charges by municipality and development of surrounding rural areas to reduce migration.

Smaller Plots/units and small streets with environment friendly planning can manage such

issues. Efficient use of space/land in building design and master plans.

90

Subsidy in tax and duties to be provided by Govt to encourage developers' interest in

affordable housing and land provision at flat rates. As described earlier, the

developers/investors should be provided with incentives in approval process and rebates

on development charges for such housing projects specifically targeting the affordable

housing for poor. Furthermore Private sector encouragement to be made part of Policies at

National & Provincial level. To extend density bonuses and floor area increase in return

for affordable units.

Land sliding could be reduced by taking up structural measures complying earthquake

code with retaining and other structures after feasible Geotech-investigations. Utilizing the

rainfall potential by promoting RWH could reduce the land sliding and storm draining

issues. SWOT analysis also includes the view points of stakeholders.

4.9 CORRELATION ANALYSIS OF AFFORDABILITY WITH OTHER VARIABLES

Spearman correlation analysis has been used to identify, which variables have significant

relationship with housing affordability. The analysis of test shows that household size,

number of earning members, income, non-housing expenses, food/kitchen expenses,

employment status, education, job distance, plot/unit size, plot/unit price, unit rent,

housing expenses, financing for housing, and loan repayment have higher/lower

significant relationship with affordability among the respondents.

The correlation analysis indicates that distance to workplace/job, plot/unit size, and market

price of the plot/housing unit, unit rent have high level of significance with affordability,

as it stands at 0.308, for distance to employment, 0.219 for plot/unit size, 0.338 for price

of the plot & housing unit, and -0.585 for rent of unit as its level of significance.

91

The household size has the positive correlation with affordability but it has low level of

significance with correlation coefficient value as (r = 0.062, n=130, p= .482). The positive

value in this correlation claims that housing affordability increases with higher household

size and decreases with less size. While the household size has a positive significant

relationship with earning members living in a house (correlation co-efficient r = 0.425,

n=130, p=.00), with non-housing expenses (correlation co-efficient r = 0.283, n=130,

p=.001), and food expenses (food/kitchen) (r = 0.366, n=130, p=.00), with bank loan

facility (r=-.227, n=128,p=.010. That relationship denotes that, the increase in household

size tends to increase the earning members, and increase the non-housing and food/kitchen

expenses that are relevant to affordability.

Earning members have some positive correlation with affordability but low level of

significance with correlation values as (coefficient r = 0.283, n=130, p=.001). As the no of

earning members increases in a family, the affordability increases as observed among the

respondents. Which indicates that more the earning members more will be easier to afford

the food/kitchen expenses and high affordability to save for housing construction or

buying plot/unit. It has been observed among the respondents that income level has a

correlation with affordability but low level of significance with correlation values (r = -

0.31, n=130, p=.726). As per the respondents survey the households hardly can save any

amount for their housing for improvement or construction, that tend to negatively affect

the affordability, this is due to low income levels of most of the respondents. Non-

Housing expenses, (that includes the expenses incurred on food, utility bills, education,

and health etc.) also has a correlation with affordability but low level of significance with

values of correlation (r = -0.057, n=130, p=.523). The negative value indicates that with

the increase in non-housing expenses, the affordability decreases and with the decrease in

non-housing expenses, increases the affordability.

92

Table 4.24: Correlation of Housing Affordability with Other Variables

A1 A2 A3 A4 A5 A6 A7 A8 A9 A10 A11 A12 A13 A14 A15

A1

Correlation Coefficient 1 .062 .035 -.031 -.057 -.094 -.090 -.129 .308** .219* .338** -.585** .105 -.026 -.019

Sig. (2-tailed) .482 .692 .726 .523 .289 .307 .145 .000 .012 .000 .000 .313 .771 .836 N 130 130 130 130 130 130 130 125 130 109 114 94 128 123

A2

Correlation Coefficient 1 .425** .143 .283** .366** .073 -.025 .003 -.021 .031 -.008 .109 -.227** .167

Sig. (2-tailed) .000 .106 .001 .000 .410 .778 .969 .813 .748 .929 .295 .010 .065 N 130 130 130 130 130 130 125 130 109 114 94 128 123

A3

Correlation Coefficient 1 .325** .352** .367** .048 .116 .013 .151 .162 -.064 -.021 .074 -.065

Sig. (2-tailed) .000 .000 .000 .589 .190 .889 .087 .093 .502 .843 .406 .476 N 130 130 130 130 130 125 130 109 114 94 128 123

A4

Correlation Coefficient 1 .508** .470** -.017 .289** -.140 .165 .265** .111 .155 .201* .024

Sig. (2-tailed) .000 .000 .849 .001 .120 .061 .005 .242 .135 .023 .789 N 130 130 130 130 125 130 109 114 94 128 123

A5

Correlation Coefficient 1 .864** -.147 .328** -.141 .158 .220* -.076 .172 -.105 .220*

Sig. (2-tailed) .000 .096 .000 .117 .072 .022 .420 .097 .240 .014 N 130 130 130 125 130 109 114 94 128 123

A6

Correlation Coefficient 1 -.155 .211* -.133 .211* .144 -.012 .248* -.150 .217*

Sig. (2-tailed) .078 .016 .140 .016 .136 .898 .016 .091 .016 N 130 130 125 130 109 114 94 128 123

A7

Correlation Coefficient 1 .129 -.019 .017 -.102 .048 -.117 -.007 -.079

Sig. (2-tailed) .144 .832 .852 .293 .615 .260 .940 .387 N 130 125 130 109 114 94 128 123

A8

Correlation Coefficient 1 -.195* .122 .050 .062 -.082 .101 -.038

Sig. (2-tailed) .029 .166 .604 .512 .432 .254 .673 N 125 130 109 114 94 128 123

A9

Correlation Coefficient 1 .050 -.037 -.084 .170 -.115 .119

Sig. (2-tailed) .578 .706 .383 .104 .202 .196 N 125 107 111 93 124 119

93

A10

Correlation Coefficient 1 .356** -.312** .127 .138 -.148

Sig. (2-tailed) .000 .001 .224 .120 .102 N 109 114 94 128 123

A11

Correlation Coefficient 1 -.625** .240* .093 -.025

Sig. (2-tailed) .000 .020 .341 .799 N 97 94 108 106

A12

Correlation Coefficient 1 -.350** -.109 .187

Sig. (2-tailed) .001 .251 .051 N 87 113 110

A13

Correlation Coefficient 1 -.281** .394**

Sig. (2-tailed) .006 .000 N 94 94

A14

Correlation Coefficient 1 -.854**

Sig. (2-tailed) .000 N 123

A15

Correlation Coefficient 1

Sig. (2-tailed) N

**. Correlation is significant at the 0.01 level (2-tailed).

*. Correlation is significant at the 0.05 level (2-tailed).

A1 Affordability A2 Household Size A3 Earning Members in family A4 Income A5 Non-Housing Expenses A6 Food/Kitchen Expenses A7 Employment Status

A8 Education

A9 Job Distance A10 Plot/Unit Size A11 Plot/Unit Price A12 Rent of unit A13 Housing Expenses A14 Bank Loan facility requirement A15 Loan Repayment

94

It has been observed that among the non-housing expenses borne by the respondents, food

expenses have much higher %age of overall expenses, that makes for the survival of

households, although it has a correlation with affordability, but low level of significance

with values of correlation as (r = -0.094, n=130, p=.289). As the expenses for food

increases the affordability decreases as the respondent's saving reduces. The employment

variable has a correlation with affordability but low level of significance with values of

correlation (r = -0.090, n=130, p=.307) As the lesser employment opportunities negatively

affects the affordability.

Education variable has a low level of significance with affordability but have a correlation

with affordability with correlation coefficient values (r = -0.129, n=130, p=.145) the

negative value denotes that as the education level increases the affordability decreases and

vice versa. As per respondents survey, the higher education compels the households to

raise their living standards which in addition to education expenses, adds to the housing

expenses/desires, that tend to reduce the affordability level for most of the educated

households, due to their reduced savings.

The analysis for correlation between variables job distance and affordability show a

positive relationship with high level of significance with values of coefficient of

correlation as (r = 0.308, n=125, p=.00). As the job location is at nearer/ accessible

location, affordability increases, which has been noted in respondent's survey. While most

of the households have their jobs in hotelling/catering industry and tourism related jobs,

which are at accessible location from the residential areas. Job distance has positive

significant relationship with affordability, as if the house is located in proximity to

employment then household affordability increases while in other way it decreases. It has

been observed in correlation analysis that Plot/unit size has strong positive correlation

95

with affordability and high level of significance with correlation values (r = 0.219, n=130,

p=.012). The affordability of the household increases with smaller plots/unit size and with

large size unit/plot size, the affordability reduces as per the survey data of the respondents.

The variable unit price has strong level of significance for affordability and have a positive

correlation with that variable with coefficient of correlation values as (r = 0.338, n=109,

p=.000). The higher the price of the unit the less will be the affordability and lower the

unit price, higher will be affordability for most of the lower middle income and poor

households. The correlation values of unit rent (r = -0.585, n=114, p=.000) shows high

level of significance with negative coefficient of correlation value, which means, higher

the unit rent lower will be the affordability and with lower unit rent, higher will be the

affordability.

Housing expenses has the relationship with affordability but low level of significance

having coefficient values as (r = 0.105, n=94, p=.313), Similarly the Housing finance

required by the households for housing improvement has the correlation with affordability

with low level of significance and coefficient values as (r = -0.026, n=128, p=.771). The

repayment of housing finance has also the correlation with affordability with values (r = -

0.019, n=123, p=.836) but has low level of significance as compared to other variables.

Moreover household size has a strong correlation with other variables like earning

members (r = 0.425, n=130, p=.000), Non-housing expenses (r = 0.283, n=130, p=.001),

Food expenses, (r = 0.366, n=130, p=.000), and loan required (r = -0.227, n=128, p=.010).

It shows that more the household size, more will be the earning members and will increase

the affordability, on the other hand increase in household size increases the non-housing

expenses and reduces the affordability, and more loan will be required for higher HH size

to have larger accommodation, and it will reduce the affordability when to repay the

96

higher level of finances.

The variable earning members has high level of significance and correlation with Income

(r = 0.325, n=130, p=.000), and non-housing expenses, (r = 0.352, n=130, p=.000), as

observed in the respondents survey. With more earning members higher will be the

income and higher will be the affordability, while higher non-housing expenses will

reduce the affordability.

Similarly Income has a higher significant correlation level with other variables like, Non-

housing expenses, (r = 0.508, n=130, p=.000), education (r = 0.289, n=130, p=.001) ,

unit/plot price, (r = 0.265, n=109, p=.005) and loan required. (r = 0.201, n=128, p=.023). It

has been observed by analysis that higher the income level, higher will be the non-housing

expenses and lower will be the affordability, with increased income, the education level

will increase or higher education increases the income level and affordability, and also

increases the living standards, and when living standards raised it reduced the

affordability. With increased income, the higher priced unit could be purchased or

constructed, and larger loan could be availed.

Non-Housing expenses has a high level of significance with food/kitchen expenses(r =

0.864, n=130, p=.000), education, (r = 0.328, n=130, p=.000), unit price(r = 0.220, n=109,

p=.022), and repayment of housing finance. (r = 0.220, n=123, p=.014). As the food

expenses makes the highest part of the overall non-housing expenses, so as the non-

housing expenses increases, consequently increases food expenses, and as these expenses

rises, that reduces the affordability. As the education level increases, the non-housing

expenses increases and vice versa. That increases the living standards and reduces the

affordability, and with the increase in non-housing expenses also makes difficult the

repayment of loan.

97

Education and job distance variables are strongly correlated and high level of significance

with correlation values as (r = -0.195, n=125, p=.029). Higher the education level, closer

the distance to employment, as education creates more job opportunities everywhere in job

market. Plot/unit size has high level of significance with unit price with correlation

coefficient values as (r = 0.220, n=123, p=.014) and unit rent, (r = 0.220, n=123, p=.014).

As the plot/unit size increases the price of unit increases and vice versa, with reducing

affordability, while with increase in unit size the rental value decreases, as people prefer

smaller units as compared to larger units. As small units have higher rental value, and

large units have lower rental value.

The unit price has also a significant correlation with unit rent, (r = -0.625, n=97, p=.000).

as the high unit price reduces the unit rent while lower value units have higher rents which

affects the affordability of the households. The housing expenses are highly correlated

with loan required (r = -0.281, n=94, p=.006). and repayment of finance, (r = 0.394, n=94,

p=.000). as the housing expenses are increased due to larger amount of loan and its

repayment installment that ultimately positively or negatively affects the affordability. The

bank loan required is also highly correlated with repayment installment of the loan. (r = -

0.854, n=123, p=.000). The higher the loan requirement, the higher will be installment

and the lesser will be affordable to repay for most of the households as observed in

respondents survey.

4.10 NEED ASSESSMENT OF HOUSEHOLDS FOR AFFORDABLE HOUSING

The household survey in Murree was conducted regarding need assessment for affordable

housing on sample population. About 130 households were sampled for survey. The

survey indicates that every household has its own preferences and issues for having an

affordable house depending on their socio-economic and cultural factors. The factors or

98

needs that were highlighted for affordable housing in Murree are mortgage financing for

housing, improved transport linkages, low rent of flats/units, lower price plots, interest

free loan/Islamic mode of financing for housing, subsidies on housing, reduced

construction cost with lower price of building materials, proximity to facilities, and size of

plots to be smaller to make it affordable for middle and lower income households.

As per respondents survey, majority of them (68.46%,n=89) said they need finance for

improvement/ up-gradation or construction of their house. Part of it requires finances for

improvement, due to expansion in family size and damages in snowfall/land sliding and

partly need for new house construction. Most of the respondents (79.23%, n=103) believe

that their house should have good public transport linkages, as they have to travel/walk in

tough slopes/terrain due to poor linkages, it will increase their accessibility to job and

other facilities thereby increasing affordability.

Table 4.25: Need assessment for Affordable Housing

S.N Factor/Need No of Respondents %Age

1. Finance for housing 89 68.46 2. Transport linkages 103 79.23 3. Low rent 124 95.38 4. Low plot price 127 97.69 5. Interest free loan 105 80.77 6. Subsidies on housing 124 95.38 7. Low Construction Cost 123 94.62 8. Proximity to Facilities 107 82.31 9. Small size Plot 97 74.62

Regarding the rental values of units a higher %age of respondents (95.38%, n=124)

describes that the rents are too high in Murree which are out of reach of the poor and it

should be reduced as per the incomes of the poor residents. Moreover the rents are higher

due to the influx of tourists and ban on housing, it should be removed to accommodate the

tourists and new construction may tend to reduce the pressure on housing. Respondents

99

also pointed out that the rents should be on monthly basis, while here in Murree city the

owners charge in advance for annual basis, which makes it more difficult for the lower

middle income and the poor to pay.

Survey shows that almost all of the respondents (97.69%, n=127) were of the view that the

prices of the plots should be reduced, so that a poor and middle income group could easily

buy that. The present prices are too high to be afforded within the income ranges of most

of the households. As the Murree is tourist city the property prices are increasing day by

day which the rich /higher income group and investors keep on buying which increases the

speculation and most of the plots are held by investors. Moreover new construction is

banned and there is no new housing project for the lower income group/poor where they

can buy the plots at lower prices.

Figure 4.23: Need Assessment of the Households for Affordable Housing

Majority of the households (80.77%, n=105) reveal that they want the interest free loans

for their house improvement or new house construction which should be as per Islamic

terms and conditions. As the present system of loan/financing is un-Islamic. Moreover

68.46

79.23

95.38

97.69

80.77

95.38

94.62

82.31

74.62

0.00 20.00 40.00 60.00 80.00 100.00 120.00

Finance for housing

Transport linkages

Low rent

Low plot price

Interest free loan

Subsidies on housing

Low Construction Cost

Proximity to Facilities

Small size Plot

%Age of Respondents

Fact

ors

Need Assessment

100

there is also ban on financing for housing in Murree due to various reasons. Subsidies on

housing may make it affordable for about most of the poor and middle income (95.38%,

n=124) as per survey result from the respondents.

When asked about the construction cost of the house and building materials, about 94.62%

of the respondents said, it is also too high and out of the reach of the poor, so it should be

reduced to make it affordable for the lower & middle income groups as per income of the

household. More than two third of the of the respondents (82.31%, n=107) indicated that

their houses should have accessibility to all the facilities including job, schools for

children, playgrounds/parks, shopping areas, health center etc, with improved

infrastructure, i.e, water supply, sewerage, drainage etc. When asked to respondents about

the approximate size of plots they can afford, then majority of them (74.62%, n=97)

described that it should be smaller in size to be owned by the poor, less than 5 Marla.

(1200sq.ft or lesser) as the land prices are higher, so small size plots will have small value

to pay by poor and middle income group that could be affordable by most of them to buy.

4.11 PUBLIC SATISFACTION SURVEY/ANALYSIS

To assess the satisfaction of the households on the performance of various departments i.e,

housing, land, building, finance, a public satisfaction survey was carried out in the target

areas. The details of that survey have been described in below sections.

4.11.1 Public Satisfaction over the Performance of Housing Departments

The households were asked to give their opinion, as to what extent they are satisfied with

the performance of institutions/deptts involved in affordable housing provision, which has

been rated as excellent, good, average, poor and very poor. Majority of the respondents

have shown their dissatisfaction over the performance of such departments. As nearly one

third (35.4%) said the housing deptt was on average performance, 26.9% said it was poor

101

and 24.6% said it was very poor, while 32.3% said the performance of land deptt was very

poor, and 28.5 % as poor & 25.4% said it has average performance and 13.1% rated it was

good. About building control, about 36.2% said it is performing poor, and 33.1% said it

Table 4.26: Descriptive Summary of Satisfaction Level over the Performance of Housing Departments among the Respondents

Satisfaction Level

Total Survey Items

Q-1 Q-2 Q-3 Q-4

N 128 129 130 115 Excellent 3.1 .8 3.1 3.8

Good 10.0 13.1 4.6 5.4 Average 35.4 25.4 23.1 13.8

Poor 26.9 28.5 36.2 35.4 Very Poor 24.6 32.3 33.1 41.5

Total 100.0 100.0 100.0 100.0 Note: Q-1= Satisfaction level over the Housing Department for affordable unit cost/rent, Q-2= Satisfaction level over the Land Department for affordable Land provision & transparent procedures, Q-3= Satisfaction level over Building control Department for building regulations & approval procedure, Q-4= Satisfaction level over Housing Finance Department for affordable access and its terms & conditions Source:-Field survey, 2015

Figure 4.24: Satisfaction level of the respondents over Housing and Allied Deptts

very poor, while only 7.7% were satisfied with that department. About housing finance

department/institutions about 41.5% said it is very poor, 35.4% rated it as poor and 13.8%

took it as average and only 5.4% said it is good. As shown in table-4.26 & figure-4.24.

0.05.0

10.015.020.025.030.035.040.045.0

Q1 Q2 Q3 Q4Satis

fact

ion

Lev

el in

%ag

e

Departments

Satisfaction level over Housing & Allied Deptts

Excellent

Good

Average

Poor

Very Poor

102

4.11.2 Public Satisfaction Over Housing Facilities

Households opinion was achieved through questionnair about their level of satsifatcion on

various housing facilities i.e, unit size, bedrooms, location, design, unit price/rent,

Table 4.27: Descriptive Summary of Satisfaction Level over the Housing Facilities among the Respondents

Level of Satisfaction Total

Survey Items Q-1 Q-2 Q-3 Q-4 Q-5 Q-6 Q-7

N 130 129 128 129 130 128 127

Highly Satisfied 13.1 10.0 23.1 20.0 6.9 26.9 20.8

Satisfied 33.1 31.5 33.8 16.9 2.3 37.7 22.3 Normal 29.2 28.5 21.5 40.0 38.5 20.8 39.2

Dissatisfied 23.1 25.4 13.8 17.7 35.4 9.2 12.3

Highly Dissatisfied 1.5 4.6 7.7 5.4 16.9 5.4 5.4 Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Note: Q-1= Satisfaction level over the size of plots/unit, Q-2= Satisfaction level over the no. of bedrooms, Q-3= Satisfaction level over location of unit/plot, Q-4= Satisfaction level over design of the unit, Q-5= Satisfaction level over the cost of the unit/plot &rent, Q-6 = Satisfaction level over the safety &security in the unit/area, Q-7= Satisfaction level over the access to the unit & other facilities from the unit.. (Unit means House or flat) -Source:-Field survey, 2015

Figure 4.25: Satisfaction level of the respondents over Housing facilities

safety/security and access to their house, which have been depicted in tabel-4.27 and

figure,4.25. About one third (33.1%) of the respondents were satisfied with their unit/plot

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

Q1 Q2 Q3 Q4 Q5 Q6 Q7

Satis

fact

ion

Leve

l in

%ag

e

Housing Facilities

Satisfaction Level over Housing Facilities

Highly Satisfied

Satisfied

Normal

Dissatisfied

Highly Dissatisfied

103

size, 29.2% said it is noraml, and 23.1% dissatisfied, while 31.5% of the respondents were

satisfied with no. of bedrooms and 13.8% were not satisfied. Similarly 23.1% of the

households were highly satisfied about the location of their unit, 33.8% satisfied and

13.8% distastified, while 40% of repondents said the design of their unit is normal, 17.7%

were distastified over it. regrading the price of unit/rent about 38.5% have shown normal

satisfatcion, 35.4% not satisfied and 37.7% were satisfied with the level of safety and

security in their area, and 20.8% said it was normal. As regard the access to their unit,

20.8% were highly satisifed and 39.2% shown normal satisfaction, while 12.3% shown

dissatisfaction over it.

4.11.3 Public Satisfaction over Quality of Housing Facilities (Infrastructure/ Structure)

Table-4.28 shows the household satisfaction over quality of structure & infrastructure and

Table 4.28: Descriptive Summary of Satisfaction Level over the Quality of Infrastructure/Structural Facilities among the Respondents

Level of Satisfaction Total

Survey Items

Q-1 Q-2 Q-3 Q-4 Q-5 Q-6 Q-7

N 127 130 129 127 130 129 128

Excellent 12.3 13.1 5.4 11.5 16.2 34.6 16.9

Good 32.3 17.7 10.8 37.7 14.6 38.5 33.1

Average 40.0 38.5 20.0 22.3 43.8 18.5 42.3

Poor 14.6 20.8 35.4 21.5 16.9 4.6 5.4

Very Poor .8 10.0 28.5 6.9 8.5 3.8 2.3

Total 100.0 100.0 100.0 100.0 100.0 100.0 100.0

Note: Q-1= Satisfaction level over the Structural stability of unit, Q-2= Satisfaction level over the sewer & drainage system, Q-3= Satisfaction level over availability of safe drinking water, Q-4= Satisfaction level over mould/dampness in unit, Q-5= Satisfaction level over the protection from hazards, Q-6 = Satisfaction level over the adequate natural ventilation, Q-7= Satisfaction level over the quality of building materials used. (Unit means House or flat) Source:-Field survey, 2015

rated as excellent, good, average, poor and very poor.About 40% say their unit's structure

104

is average quality and 14.6% believe it is poor, one third (32.3%) rate it as good, while

38.5% of the respondents believe that sewerage & drainage system is of average quality

and 17.7% says it is good, 20.8% rate it as poor. About 35.4% respondents says the

quality of drinking water is poor, 28.5% say it is very poor, and 20% believes it is of

average quality. About 37.7% respondents feel that their unit is good to reduce dampness,

Figure 4.26: Satisfaction level of the respondents over Quality of Infrastructure facilities

21.5% agree it is poor and facing, about 43.8% agrees that damages due to hazards, i.e,

rainfall, snowfall, landsliding are frequent & average level, 14.6% says it is less damaging,

and 16.9% feel their unit face damages due to such hazards. Similarly 34.6% of the

respondents feel the natural ventilation system is excellent in their house, only 18.5% says

it is of average quality, 8% says it is poor/very poor. When asked about the quality of

building materials, 42.1% believes it if of average quality, 33.1% agrees as good and

16.1% said as excellent, only about 8% says it is of poor/very poor quality.

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

Q1 Q2 Q3 Q4 Q5 Q6 Q7

Satis

fact

ion

Leve

l In

%Ag

e

Infrastructure Facilities

Satisfaction level over Infrastructure Facilities

Excellent

Good

Average

Poor

Very Poor

105

4.12 ECONOMIC DIMENSIONS OF HOUSING

The econmic dimensions include the unit cost, rent of unit, source of financing, household

income, non-housing expneses, housing finance requirement, repayment affordability etc.

These have been calculated for standard deviation and mean, with sample size and %age

of respondents in the following table.

Table 4.29: Standard Deviation And Mean Of Affordable Housing Variables (Economic)

S.N VARIABLE SAMPLE STAT N %Age Mean S.D*

1. Source of Financer 129 1.60 1.52 N/A 60 46.5 Bank 1 .8 Family/Friend 66 51.2 Employer 2 1.6

2. Market Price of the Unit/House (Thousand Rupees)

129 1.38 1.36

N/A 38 29.5 1000 and Less 11 8.5 1000-2500 29 22.5 2500-4000 23 17.8 4000-5500 19 14.7 5500-7000 4 3.1 7000 and above 5 3.9

3. Unit Rent per annum (In Thousand Rupees)

130 0.94 1.85

N/A 99 76.2 20 and below 2 1.5 21-45 5 3.8 45-70 5 3.8 71-95 6 4.6 96-120 8 6.2 121-150 4 3.1 151 and above 1 .8

4. Household Income per month (Rupees) 130 4.53 1.39 8000 or less 4 3.1 8000-13000 9 6.9

106

13000-18000 15 11.5 18000-25000 31 23.8 25000 -30000 28 21.5 30000 and above 43 33.1

5. Earning Members in Household (Numbers)

130 1.58 0.64

N/A 1 .8 1 62 47.7 2-3 57 43.8 4-5 10 7.7

6. Non-Housing Expenses (In thousand Rupees per month)

130 2.99 0.93

less than 10 4 3.1 10-20 33 25.4 20.1-35 64 49.2 35.1-50 18 13.8 50.1 and above 11 8.5

7. Bank Loan Availed for House/unit

construction or Improvement 130 1.95 0.21

Yes 6 4.6 No 124 95.4

8. Housing Finance Requirement 128 1.41 0.49 Yes 75 57.7 No 53 40.8

9. Housing Finance Required (In Thousand Rupees)

130 1.87 2.06

N/A 56 43.1 300 and less 11 8.5 301-600 16 12.3 601-1000 20 15.4 1001-1600 9 6.9 1601-2500 4 3.1 2501 and above 14 10.8

10. Housing Finance Repayment as per household Affordability (In Thousand Rupees per month)

130 1.38 1.45

N/a 54 41.5 3 and less 16 12.3

107

3-7 35 26.9 7-12 13 10.0 12-20 6 4.6 20 and above 6 4.6 *S.D= Standard Deviation, * N= Sample size

4.13 AFFORDABLE HOUSING CHALLENGES

There are many factors involved behind the housing supply-demand gap. The main

challenges for the provision of affordable housing described below have been highlighted

on the basis of household surveys, stakeholder's interviews, SWOT analysis and literature

review.

High Construction Cost:- The construction cost of the houses/units is too high to be

afforded by majority of the lower middle and low income households. This is due to high

cost of building materials and labour. Moreover costly designs and lack of knowledge

about construction techniques/supervision by trained professionals add to the problems of

construction cost. Poor quality construction due to cheap materials results in poor indoor

air quality & higher life cycle cost, that affects, wellbeing &productivity of households.

Lack of Affordable Land:- The cost of land has gone up alarmingly in the recent

years, which is in good location and accessible adequate facilities and infrastructure. Lack

of new housing projects, tourist influx and speculation, poor land registration & titling

process, lengthy/cumbersome procedures, ineffective land acquisition laws, inappropriate

land use and zoning & building regulations are main causes of high land prices.

Lack of Housing Finance:- Housing finance is inaccessible to majority of the

households due to higher interest rates, high down payment, non-Islamic, inflexible terms,

lengthy procedures, lack of transparency. As presently housing and construction is banned

in Murree city. Banks are reluctant to offer finance to lower income household due to poor

land titles and proof of income.

108

Ineffective Policies and Regulations:- Presently there is no affordable housing

policy, while the housing policy 2001 was not revised yet. The land use and building

regulations are poor and not flexible for the lower income households. Especially for the

hilly areas there needs to be effective regulations and standards that encourages

environment friendly affordable housing.

Inadequate Master Plan:- Presently there is no master plan for the city that resulted

in haphazard development and environmental degradation. Master Plans guide the city's

development as per regulations.

Lack of Training and Research:- Lack of trained labor in construction techniques is

major factor in poor quality construction. Moreover training of professionals and public

sector staff with other stakeholders is in adequate that is required for decent quality

affordable housing and efficient procedures/process. Apart from CWHR, there is no

effective research center on the development of low cost construction materials and

techniques. The role of CWHR is limited and not improved over the years due to lack of

resources and government support.

Capacity Building:- The role of the public sector departments involved in housing

delivery including building and planning department, land department and infrastructure

development departments is extremely poor, with lengthy procedures and lacking

transparency, and training. There is dire need to extend training to the staff of these

departments for efficient and time saving procedures.

Lack of Community Participation:- The households satisfaction is only achieved if

they are involved in regulations, designs/plans and other decisions regarding their

interests. While current scenario is against that as the households are highly dissatisfied

with the current development and process.

Private Developers Interest:- The private developers mostly develop housing

109

projects targeting the higher income and higher middle income class, and seasonal tourists

as in case of Murree, to gain higher profits, while they have least interest in developing

affordable housing projects. Appropriate measures needs to be taken to attract private

developers for the provision of affordable housing.

Socio-Economic Issues: The housing projects are developed without focusing socio-

economic issues of households. While data analysis in this research has proved that there

is a strong relationship of affordability to socioeconomic determinants. The households

prefer housing with accessible public facilities i.e., education, health, job etc, and have

adequate infrastructure with decent quality housing. In my research households have low

income levels/savings, low education levels, and higher household size, with overcrowded

and poor quality housing conditions. The household's social status and living standards

highly affect the housing demand & supply. With rising income inequality, affordability of

poor households is key factor in having a decent quality house at a cost they can afford.

4.14 FRAMEWORK FOR PROVISION OF AFFORDABLE HOUSING IN MURREE

After all the data has been tabulated, and various analysis & tests have been applied to

identify and highlight the main issues and constraints in the provision of affordable

housing. On the basis of data analysis, SWOT, literature review and stakeholder's

interviews, and to address the challenges discussed in previous section, the framework for

provision of affordable housing has been developed. The framework showing issues,

dimensions, area and measures with institutional support and outcomes have been

described in the table of framework. The framework has been divided into four

dimensions, which includes, Urban planning & Policy, second is the standards, regulations

and procedures, third is Institutional development and fourth dimension is Investment

friendly environment.

110

FRAMEWORK FOR AFFORDABLE HOUSING PROVISION Issues Dimension Area Measures Institutional

Opportunities (Rebates/Subsidies)

Monitoring & Evaluation

Construction&

Development

Outcome A

FF

OR

DA

BL

E H

OU

SI

NG

Master Plan

• Zoning/Land use

• Infrastructure • Amenities/

Public facilities

• Housing Schemes/Projects o Efficient/Sustainable land use Planning o Conservation of Natural features o Higher Density Areas with mix plot sizes o Inclusionary Zoning o Row Housing/Apartments provision on

ownership & rental basis o Environmental Conservation Planning o Accessibility to Facilities/ Job/Public

Transport o Safety & Security, Disaster Management

Planning for natural/manmade hazards, • Infrastructure Planning o Roads/Streets & Walkways , o Water Supply Planning /Rainwater Harvesting o Sewerage/Drainage system, disposal &

treatment o Electricity & Gas and Solar system • Provision of Amenities/ Public facilities o Parks/Play Grounds, Educational facilities/

Schools & Health Center/Hospital o Community Centers/Leisure activities, Masjid

& Library, Commercial areas &Other facilities • Building Plans/Designs o Cost effective/ Durable/Robust Designs o Functional/ Designs o Energy Efficient Designs o Roof Water harvesting Planning • Urban Renewal Plans/Slum Up gradation o Planning/upgrading of existing Residential

Areas/units for durability & healthy living, o Planning for improvement of Internal /External

Infrastructure (Streets, Water supply, sanitation)

o Providing facilities at convenient Locations o Re-location of vulnerable units/ community

• Haphazard Development / Poor Planning

• Environmental Degradation,

• Shortage of Affordable/ Adequate Housing

• Growth of illegal settlements/Slums

• Substandard Infrastructure

• Water Shortage • Overcrowded

housing • Higher cost of

Housing (Ownership/rental)

• Lack of Adequate Amenities

Urban

Planning

& P li

• Community participation in Planning& designing

• Capacity Building of Staff • Training &

Awareness in development process, its benefits and techniques • Technical & legal

assistance in building construction/ Approval • Transparency in

allotment & approval • Single Executing/

Approving Agency to avoid overlapping functions/delays

• Incremental/Self-help housing promotion

• Supervision of Development / construction as per/ Standards & approved Plans/ designs

• Quality Control

• Cost control • Timely

completion

• Selection of Appropriate &Affordable materials

• Selection of environment friendly materials

• Adopting modern construction techniques

• Selection of approved/standard construction materials

• Training of labor & Professionals in construction techniques

• Controlled Urban sprawl, Density

• Reduced the slums/informal settlements growth

• Provision of affordable, durable, livable, environment friendly & healthy housing units

• Economic uplift of the area & community

• Employment opportunities

• Community well-being/satisfaction

• Environmental Improvement of the Area

• Stress reduction on existing Infrastructure/ Housing

• Housing for lower & middle income group

• Growth of illegal settlements/Slums

• Poor Infrastructure • Higher cost of

Housing (Ownership / rental) • Land Speculation

Regulation

s &

Standards

• Land • Finance • Housing Development

• Land supply & Access to Land information

o Computerization of Land records o Improvement of procedures for land

Registration & titling and Transfer system o Reducing speculation o Establishing Land Banks o Providing Security of tenure (transferring

ownership rights to katchi abadies/slums

• Community participation in record & procedures improvement

• Capacity Building of Staff

• Training/Awareness in Land , Finance & building regulations /approval procedures

• Supervision of Development & construction as per/Standards & approved Plans/ Designs

• Quality Control • Cost control • Timely

completion

Development

of Revised

Regulations,

standards and

guidelines

• More land Available to more households

• Access to Land & Finance improved

• Land disputes decreased • Secure tenure increased

with Ownership rights • Improvement in laws

& regulations

111

• Lack of financing • Low income • High rent • Higher land cost • Lengthy/cumbers

ome Procedures for Land registration & financing

• Non-Islamic financing

• Security of tenure issues (house /plot ownership status)

Regulation

s,

Standards

• Land • Finance • Housing Development

• Finance for improvement/ construction

o Offering Islamic mode of finance/ No interest rate

o Flexible Terms & Simple/Easy procedures o Low down Payment/Bank guarantee relaxation o Easy repayment installments o Incremental finance system • Housing Development o Efficient land use regulations with flexible

procedures for approval of Plans o Effective Building regulations for promoting

affordability in housing and easy /simple approval procedures

o Water conservation & energy efficiency in building & Land use regulations

o Approved/recommended standards manual to follow for Infrastructure design and Building designs & development

• Reducing Overlapping functions of agencies

• Training Programmes of staff • Skill enhancement • Computerization of all information • Training of IT & technology

• Public-Private ventures o Land Acquisition by state o Supervision by state o Development/Investment by Private

developers o Profit oriented schemes/activities • Private Development o Land acquisition assistance o Materials subsidies o Supervision by state o Bank financing opportunities • Construction Industry o Tax rebates o Subsidies on raw materials use of innovative/appropriate technology

Technical & legal assistance in Land

• Finance & Landuse regulations/procedures

• Transparency in allotment & approval and financing

• Reducing stamp duties, transfer fees, property taxes for smaller plots, approval fees

• Upgrading Land use & Building regulations

• Upgrading rental/land acq isition la s

• Efficient and time saving procedures

• Reducing approval Procedures & fees

• Delays in approval and processing,

• Lack of Access to information

• Lack of transparency

• Bribery

Institutional Development

• Coordination • Capacity

Enhancement • Information

technology • Training

Investmen

t Friendly

Environment

• Low profit for private developers

• Lack of confidence of Households on private developers

• Lengthy Approval procedures

• Public-Private Partnership • Private

Development • Construction

Industry

• Efficient approval procedures

• Equipment /technology provision

• Legal & technical assistance

• Transparency

Monitoring of Progress

• Efficient and time saving procedures

• Reducing approval Procedures & fees

o Rebates/Subsidies to private developer

o Quick approvals and rebates in fee

o Rebates in land transfer/registration

o Taxes rebates to construction Industry

o Legal & technical assistance

o Transparency o Cheaper land

through Land banks o Density Bonus

• Supervision of Development & construction

• Quality Control

• Cost control • Timely

completion

• Private Investment Enhances

• Quick Development of housing projects

• Low cost construction Material

• Profit oriented development

• Economic uplift of the area & community

• Employment opportunities

Technology & Equipment

Technology & Investment

112

Chapter 5

CONCLUSIONS & RECOMMENDATIONS

5.1 CONCLUSIONS

Globally and particularly in the developing countries, Affordable Housing provision is a major

challenge for the Governments. Population growth and urbanization are key factors behind the

growing demand for affordable housing. Lack of focus on housing provision along with weak

policies has put pressure on the existing housing stock and growth of illegal settlements,

slums/katchi abadies along the peripheries of the cities & flood plains, where the poor finds the

land as per their income levels for their shelter needs. Housing is the basic right of every human

being and every household's desire is to have an adequate and affordable house for his family as

per their income levels.

The present population of Pakistan is about 191.71 million in 2015 at an average yearly rate of

2.7%. Pakistan is facing acute housing shortage and specially the shortage of affordable housing.

The housing deficit in Pakistan is about 09million units with annual additional requirement of

0.7million units. The housing deficit for low income households is about 4.5 million units, with

annual addition of 150000 units. The housing deficit is due to rising population and urbanization.

As the Poor & lower middle income group, who couldn't find adequate housing facilities at

affordable cost, opt to live in slums/katchi abadies.

Poor housing & urban policies, inefficient landuse &building regulations, unemployment and low

income levels, higher land cost, speculation, higher construction cost, costly building materials are

some of the major constraints/reasons for shortage of affordable housing and growing slums. Lack

of access to housing finance due to lengthy procedures & strict terms, are other reasons for housing

deficit. Most of the housing projects/gated communities developed by private developers in

113

Pakistan are meant for higher profits, targets higher income and higher middle income groups.

Murree city has been selected as case study for the study of affordable housing. Murree is tourist

city situated at hilly mountains with tough terrain which makes it difficult to walk and move to

other destinations by road. Most of the activities are being done by walk by most of the residents.

The data on the objectives defined for the research study was collected through primary and

secondary sources and analyzed. The data on demographic and socio-economic variables was

collected through household survey. Most of the households are living in overcrowded housing

conditions, with small unit size and narrow/broken streets, low quality housing conditions,

substandard water & sewer facilities, and no proper drainage system. The condition of units is

highly prone to natural and manmade hazards. Affordable housing is not merely the lower cost of

construction/shelter, but also the provision of adequate facilities, amenities and quality of housing

matters. The access to employment/job, school and health facilities is equally important for the

provision of affordable housing, which lacks at most of the locations. Due to difficult terrain there

is shortage of playing grounds/parks.

The data on economic dimensions including the household income, non-housing expenses, market

cost of the unit/house, housing finance requirement, repayment, monthly rent, was collected. The

data analysis on economic variables revealed that, most of the respondents/ households are unable

to save any amount for the improvement of the house/unit or construction of their house/unit.

Majority of the households are hardly making their survival with their income levels/earnings. The

land cost and the unit cost is too high for them to afford. Moreover the households who are living

in rental units have to pay annual advance rents which is also not affordable for most of them with

poor conditions demanding repairs.

The condition of housing and household income further aggravated due to ban on construction by

the provincial Govt, that lead to increased unemployment, and more housing deficit. Such

114

interventions results in proliferation of illegal settlements and illegal construction in the shape of

slums/katchi abadies. The housing finance is also ban in Murree owing to reason of default as most

of the loans borrowed for commercial purposes were not returned and defaulted. That was the

main reason behind the ban on housing finance by private and public institutions in addition to

terms &condition being too lengthy, un-Islamic/high interest rate, high down payment as revealed

by the banks and households during interviews. The only public sector institution is HBFC

offering housing finance for the house improvement and construction of units. The land

registration and titling system is ineffective, and lengthy/cumbersome procedures are involved for

land transfer or registration.

There is only one housing scheme MIT, that was developed in Murree urban area, which is too un-

affordable for the middle & lower income groups. The other projects developed in Murree city are

in the shape of apartments which were targeted for the seasonal residents (Tourists) who opt to

stay during summer season and units remain vacant during the rest of the year. Other housing

projects in TMA limits are along Islamabad limits in Murree rural area. Moreover the existing

housing stock is less resistant to seasonal hazards i.e., land sliding, rainfall & snowfall, which

significantly affect the lower income group housing, that let them keep on repairing their units

damaged due to such hazards.

The second objective was to find the gap between housing supply and demand; the data was

collected through secondary sources. The population of Murree in 1998 was 14000 persons and

housing units were 2088 and household size 5.8. Keeping in view the annual growth rate the

population and housing units were estimated/projected for the years, 2015 as elaborated in table:

4.2. The gap in housing supply and demand increased due to ban in construction, population

growth, and urbanization. The rents specially rise during peak season of tourist in summer which is

partly due to shortage of rental and owner dwellings/units. The present housing deficit is 1750

115

units as shown in table-4.2. To achieve the third objective a public satisfaction survey was done

about the performance of housing departments/institutional issues and housing facilities provided.

The households have expressed their high displeasure over the performance of housing department

(no new housing project for the poor), building department of TMA, about the procedures

&inefficient regulations, Land department involved in land registration and transfer, about their

procedure and steps included, and then housing finance institutions (poor performance as their

finance is un-Islamic and involves lengthy procedures and bribe. The majority of respondents has

given average satisfaction over the housing facilities, location and size of their unit, design of unit,

facilities accessibility to their unit/house, topography and access to job. The respondents are quiet

less satisfied over these housing facilities.

The analysis shows that, most of the respondents were highly dissatisfied over water supply and

sanitation & quality of facilities they have, while rest of the facilities(structural stability, protection

from hazards, indoor air quality) are average level. Majority of the respondents was of the opinion

that they never received any legal/technical assistance from any department about the design or

construction of their unit or land registration &finance system; and highly dissatisfied over the cost

of building materials. Survey analysis also shows that shortage of affordable housing is mainly due

to lack of initiatives from the Govt, excessive land cost and tourist influx. Moreover the high rent

is attributed to the tourists' influx, shortage of housing, ban on construction and weak rental laws.

The fourth objective of the study was to devise a framework for affordable housing provision. On

the basis of data analysis, and highlighting the issues & barriers in the provision of affordable

housing, a framework was developed for the provision of affordable housing, including steps and

approaches to be followed to achieve the objectives of affordable housing.

The correlation test of affordability with other socio-economic variables shows that affordability

has highly significant correlation with plot/unit size, plot/unit cost, rental cost, and distance to job.

116

Moreover household size, no of earning members, income level, and non-housing expenses also

has significant correlation with other variables involved in analysis that positively or negatively

affects the affordability.

The SWOT analysis for the provision of affordable housing was done, keeping in view the current

situation, issues and problems. The strengths, weakness, opportunities and threats has been

highlighted in table-4.23. By managing the weaknesses and threats, the barriers to affordable

housing could be managed that will pave the way for development of affordable housing. The need

assessment of the households depicts that majority of the respondents need affordable housing unit

on ownership/rental basis, with low price plot, low rent, small size plot/unit, housing finance for

improvement or construction, construction cost to be reduced by subsidized building materials,

proximity to facilities/amenities with transport linkages.

Presently there exists no affordable housing policy at the national & provincial level, nor do the

zoning/Landuse & building regulations promote the development of affordable housing. The

problems and issues are growing and there is no heed to it. No affordable housing project is in the

pipeline, the condition of buildings and infrastructure is deteriorating that may result in any hazard.

Unhygienic, overcrowded, high density living conditions/environment, with substandard building

designs/construction and infrastructure. Energy & water conservation measures are lacking to treat

such issues at city and household level. Land registration and titling system, Land speculation,

housing finance system are ineffective to address the issue of the poor for coping the demand of

housing and reducing the growth of slums.

5.2 RECOMMENDATIONS

o Standards/Regulations:- To prepare/upgrade the Policies, standards/ regulations involving all

stakeholders for sustainable & efficient landuse planning with focus on affordable housing,

Environmental improvement, infrastructure (water supply & sanitation), and conservation of

117

water/energy and its enforcement. Up-gradation of land acquisition and rental laws,

introducing inclusionary Zoning, NRM on infrastructure & Planning Standards, building

regulations. Using 2% land reserved for graveyard for affordable units construction.

o Master Planning:-To prepare the City Master plan, keeping in view the parameters of

affordable & sustainable planning and conservation of water/energy, provision of safe drinking

water, adequate sanitation, efficient public transport, accessibility to work place and

parks/public facilities, and efficient system of solid waste management. Both type of housing

facilities i.e, on ownership basis &rental units, with row housing/multistory to be proposed in

the Plan, and land sites for future housing projects with growth directions of the city keeping in

view the population growth and urbanization. Housing projects to be designed keeping in view

the natural terrain with minimum disturbance to natural drainage pattern and natural

topography.

o Affordable Land:- Additional land to be provided with affordable access to lower and middle

income group, with no speculation (imposing fines /penalties for holding plots vacant for a

fixed time period and holding more plots, transparent allotment policy with non-transferable

rights), improving Land registration & information systems, upgrading slums, giving

ownership rights/security of tenure to the poor living in slums, and vertical developments

promotion, using shared spaces for various facilities and infill development. Efficient Land use

planning of housing projects with shared spaces, small plot size, reduced street/pavement

widths. Establishing land banks for provisions of affordable land. The idea of land banking to

be introduced as per local conditions.

o Affordable Housing Finance:- Providing Islamic mode of financing with interest free loans,

flexible terms, low down payment, simple procedures and solution for extending it to those

poor without any landownership or job guarantee. Incremental financing to be promoted.

118

o Affordable Building Materials:- The building industry to be extended tax rebates and

subsidies on import of raw materials for producing affordable building materials and using

appropriate/ local materials.

o Encouraging PPP-Investor friendly environment- Offering subsidies on development of

affordable housing projects, materials, and development charges, approval procedures & taxes.

Public-private ventures to be promoted with Govt., to provide land and development to be

carried out by the private developers. Density bonus, fast track approvals could attract private

developers.

o Up gradation of Slums:- The slums including poor quality units to be upgraded with

provision of housing finance and technical assistance to the households.

o Reducing construction cost of the unit& Infrastructure development cost:- The designs

should be cost effective(Architectural/structural), with maximum utilization of space, low cost

materials, and use of natural day light & natural ventilation, RWH to reduce the long-term cost

of utility bills and repairs. The size of the plot/unit should be as small as possible but with

provision of all the basic requirements. Infrastructure development cost could be reduced by

reducing pavement widths/street width, open draining system, by adopting RWH system

instead of more tube wells/pipe lines, and by reducing earthwork by developing designs

adhering to natural topography, thereby reducing cost of earthwork. The cost could further be

reduced by involving trained labor in construction and supervision by technically sound

professionals.

o Awareness/Training & Research:- To Plan an awareness program for the community, The

professionals and the Govt. officials about the affordable housing, land registration system,

affordable housing finance, building regulations, affordable/healthy communities and their

long term benefits, and about the water/energy conservation. Training of un-skilled and skilled

119

labor in affordable housing construction techniques and creating employment opportunities.

That will reduce the labor cost of those poor, who want to construct their units by themselves.

To establish a research center for the promotion of environment friendly low cost building

materials and construction techniques.

o Community Participation;- It should be ensured that community participation of the target

area, should be made effective from preparation of standards, designs/implementation to the

monitoring stage, to achieve better results and community satisfaction.

o Institutional Strengthening/Capacity Building/Transparency:- Training of the Institutional

staff & professionals involved in housing delivery in the respective fields. Transparency in

allotment, land registration and housing loans to be enhanced through capacity building.

o Incremental Housing:- The idea of incremental housing to be promoted by advancing small

loans to the households to build their houses as per their desires &wishes and as per their

culture and thereby they may be extended further loans for more improvements/expansion step

by step.

o Affordable, Sustainable/Energy efficient Building designs:- Energy efficient/passive solar

building designs , use of day light and natural ventilation building designs to be promoted

through upgrading the building regulations and promoting through incentives in other services

use. RWH to be adopted at community/ household level for water conservation through

building and landuse regulation enforcement.

HONESTY, SINCERETY AND COMMITMENT TO ACHIEVE THE TARGETS

120

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ANNEXURE

ANNEXURE-I

AFFORDABILITY ASPECTS, INDICATORS AND VARIABLES

S.N ASPECTS INDICATOR VARIABLE / UNIT OF MEASUREMENT

Social 1. Household Size No of Households 2. Education level No of school going years 3. Employment Status

(Employed/Unemployed) (Govt/private)

Proportion of earning households (%age)

4. Marital Status Proportion of Married Households

5. Children No of children 6. Location of House/Plot Distance from Main Road(Kms) 7. Access to Employment Distance travelled (Kms) 8. Size of Plot Sq.ft 9. Occupancy No of rooms

10. Dwelling Type Pakka/Semi Pakka (Proportion-%age)

11. Tenure status Proportion of households have ownership/tenant/ leased /illegal

occupation (%age) 12. Access to education Distance travelled to attend the

school(Kms) 13. Health Facilities Distance travelled to attend the

school(Kms) 14. Construction/Upgrading

(Self/Govt/Private) Proportion of Households

Preferring Self/Govt/Private 15. Street Width Feet Economic Housing Costs 16. Household average income(Of

all earners in house or owner) (from Pension/Job or other

sources)

Gross---Monthly income(Rs.)

17. Rent Rupees per sft 18. Cost of Land Rupees per Sq.Yd/marla 19. Cost of Land

Ownership(Transfer/ Documentation)

Rupees/Sq.Yds

20. Cost of House (Materials/labour) Rupees per sft 21. Cost of House Repair/

maintenance Average Monthly--Rupees

22. Mortgage/ Finance for Housing Rupees

129

23. Interest Rate %age of Total Finance 24. Repayment Installments Rupees per Month 25. Savings Rupees per Month 26. Tax(Income/Other services) Rupees per Month 27. Cost of Financing

(Documentation/Time Lost for House renovation/ Land

Rupees Per Sqft

28. Housing Allowance Rs per Month Non-Housing Costs 29. Food, Clothing, Education,

Health, Utilities, repairs Rupees per month

30. Cost of travelling for job, Rupees per month 31. Cost of Travelling for education Rupees per month 32. Cost of Travelling for Health Rupees per month 33. Cost of Travelling for Playing/

Parks Rupees per month

Institutional 34. Financing Institutions

(Govt)/Private Proportion of Households

Benefited from Housing Loan 35. Proportion of Households

Satisfied with terms of financing

36. Technical Assistance Departments for House construction and land

Acquisition

Proportion of Households Benefited from technical

assistance

37. Land Departments Proportion of Households Satisfied with procedures for

land laws 38. Housing Departments (providing

Low cost Housing/Plots in quantity/Quality)

Proportion of Households Satisfied with Housing

provision 39. Material Production

Industry(Quality & cost) Proportion of Households

Satisfied with Cost/Quality of material

40. Regulations/Bye-Laws-Agencies for Housing Construction/Design

and land Acquisition

Proportion of Households Satisfied with Current

regulations Satisfaction 41. Housing facilities Proportion of Households

Satisfied with Current housing facilities

42. Quality of Infrastructure Proportion of Households Satisfied with Current quality of

housing Infrastructure 43.

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ANNEXURE-II

This information is being collected as part of an academic research titled as "Strategies for Affordable Housing"(Case Study Murree City)

All the information will be used only for academic research. Privacy and confidentiality will be honored. Please read questions carefully and mark the box which is applicable.

S.N QUESTIONNAIR S.N=

Name of Interviewee:- Date: Contact: (03005385638) e.mail: (sedcopk@hotmail.com)

Name of Respondent:- Contact No:/e.mail:

House/Flat No:- Street: Block: Mohalla/Town:

A SOCIAL ASPECTS Household Information

A1 Name, gender and age group of head of household

Name Male Female Age Group 2

5-40

40-60 60+

A2 Household Size-Household members (including

children) living there Total Male Female

A3. Marital Status Single Widow Married Divorced

A4. Ownership Status Owner Leased Inherited Living with parents

Tenant Occupied Others (Please Specify) A5. Describe your Education

level(School/University years)

No schooling Secondary Less than primary

Technical or vocational

Primary Bachelors/University A6. Describe your Employment Status. (Household head)

Self Employed

Govt Deptt Unemployed Daily wages

Private Retired Other(Please specify) A7. What is your job profession?

Clerical Labor/Daily

wages

Academics Technician

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Street vendor Driver/Transport Sales/services Agriculture

Managerial Professional Construction. Others

A8. If employed, for how long you are on Job.

Years Months

Housing Information

A9. Since when you are living here (in years) (If more than 6 years, then skip to Q-No-A11)

0-2 years 7-10 years 3-6 years 11 years& above

A10. What was the primary reason you moved to your current home?

Change in family structure

Quality of amenities/ services & its proximity

Change from renter to Owner/Owner to renter

Closer to employment Reduced monthly expenses

To establish own household Lower cost

Safety/security Needed more space A11. What is the Size of your Plot/flat (In Sq.ft)

800 or lesser 800-1200 2500-3200 3200-4500

1200-1800 1800-2500 Above 4500

A12. Your House is Constructed By OR bought from;

Self Private constructor Govt Others

A13. How old is the present housing unit you are living in

Years Months

A14. No of bed-rooms/storey(Occupancy) Rooms storey

A15. Condition of housing unit/Dwelling Type

Pacca Semi Pacca Detached Semi-detached

A16. For availing the following facilities, how much you/your family have to travel a distance (kms) and time consumed (minutes)

Activity Distance Travelled (Kms)

Job Health Facility Attending School Playing/recreation Shopping

A17. Your preferred mode of transport for availing the above facilities.

Cycle/Bike Rikshaw Public transport Walk car other

A18. How often you keep on repairing/ renovating your house per year

Times/year

A19. What are the reasons for

repair/Improvement /

Family size Poor Construction

Finance issues Damaged in any hazard

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extension? Others(Please specify)

A20. If you wish to own/rent a house/flat or move to other location, what kind of accommodation type you will prefer?

Ownership Rental Flat House

B. ECONOMIC ASPECTS Owners (Skipped B1 to B3) B1. Purchased/Constructed the housing unit/plot by own

sources / financed Self Financed

B2. Source of Financer (If financed) Bank Family/friend NGO Employer

B3. What is the current Market Price of your Plot &Housing unit? (In thousand Rupees)

(Plot)Rs. (Unit)-Rs.

B4. Average monthly housing expenses (repairs/construction /loan repayment & improvements)In thousand Rupees

(Owner)Rs. (Renter)Rs.

Tenants B5. How much rent you pay for house unit(In

thousand Rs) Rupees/month.

B6. How you finance your rent From own sources Employer assisted

Govt Allowance Family/friends

B7. What is rent increment Cost annually Rs.

B8. Do you struggle in maintaining the non- housing expenses after paying the rent of housing unit.

Yes No

B9. According to you how much of your monthly income is affordable for you to pay for rent?

Rs.

Income Level B8. Household's average Monthly

Income from all sources; (In thousand Rupees.)

8000 or less 8000-12000 12000-18000 18000-25000 25000 -30000 30000 and above

B9. How many are earning members of your family living there. Number B10. What are the

sources of household Income

Job/business Pension Part-time job Saving Investment returns Others

Non-Housing Expenses B11. How much you spend(On average) on the following per month (In thousand Rupees)

Food/kitchen Rs. Education Rs. Clothing Rs. Utilities Bills(Water, Gas,

Telephone, Electricity) Rs.

Health/Medical Rs. Repairs/maintenance Rs. Transportation cost for attending/Availing the above facilities (In Rupees)

Rs.

Housing Finance/Mortgage

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B12. Have you ever availed the Bank loan for housing? (If No, skip to Q.No.B20).

Yes No

B13. If yes, what was the primary

purpose of housing finance/loan?

House Construction Plot purchase Rent

House Improvement Flat purchase Others

B14. How much loan was sanctioned?(Approximately in

thousand Rupees)

Rs.

B15. Can you tell the problems for availing/ not availing the finance facility? Non-Islamic Terms No Guarantor High Interest Rate Ownership proof High Down Payment Proof of income Installment Cost too high Low Income for repayment Tight Installment Period Lengthy procedures Lack of Knowledge Others(Pls specify)

B16. Do you need any financing/mortgage for improvement of your housing or purchasing/ constructing new house/flat

Yes No

B17. If yes how much you need and can repay per month. (In thousand Rupees)

Required Repayment per Month Rs. Rs.

C Institutional C1. Is the cost of building materials affordable as per your

income for constructing/improving the house. Yes No

C2. Have you ever received any technical /legal assistance from any Govt/Private organization for design/ construction/ Improvement of house, or for taking finance

Yes No

C3. What major causes are making housing even more unaffordable in Murree?

Lack of initiative from Government in ensuring affordable housing

Excessive Land cost Tourist City

Non-availability of affordable housing loan Others (please specify) C4. What are the causes for high housing unit rent in Murree?

There are shortage of housing units Tourist City Absence of government regulations to control house rent

Ban on Construction Others (please specify)

C5. What do you think about the performance of Government agencies responsible for housing matters? (their procedures & facilities). How do you rate their performance? (1-for excellent & 5 for worst) 1 2 3 4 5

a. Housing Deptt (In provision of affordable housing/cost of unit, for the middle/lower income & rent control measures)

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b. Land Deptt (Land cost control, its transfer/registry procedures & taxes/fees for registry and access to land documents)

c. Building Control (Building regulations & approval procedure)

d. Housing Finance provision i/c (Installment/Interest rate/down payment) is affordable/ accessible for all income groups.

D SATISFACTION /QUALITY FACTORS

D1. To what extent you are satisfied for the following ;( Rank 1-highly satisfied & 5- for highly dissatisfied)

1 2 3 4 5

a. Plot Size/Flat Size b. No. of bed-rooms/covered area c. Housing unit Location w.r.t accessibility to Public

transport, Job, education & health facilities

d. Design of your House/Flat e. Price of house unit OR Rent f. Safety & security in house/Town g. Topography/Access to house unit

D2. Does the place you live have/have no problems with any of the following:(Rank-1 for excellent quality/condition &5 for worst)

1 2 3 4 5

a. Structural stability b. Sewer & drainage system c. Safe drinking water d. Mould or dampness e. Damages due to land sliding, heavy rainfall/snowfall f. Adequate Natural ventilation/daylight (location of

windows/ ventilators & atrium if any)

g. Quality of building materials (Brick, steel/iron, tin,wood, cement)

Please give your opinions/suggestions about any improvements in the Housing, materials, cost, Land, loans and neighborhood amenities and services and problems to resolve.

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ANNEXURE-III

STAKEHOLDERS INTERVIEW

The following information is being collected as part of an Academic research titled as "Strategies for Affordable Housing".

All the information will be used only for academic research. Privacy and confidentiality will be honored.

Name of Respondent e.mail/Contact No:-

Name of Interviewee:-

Designation/Profession:- Address:- e.mail:- sedcopk@hotmail.com

Organization:- Date:- Contact:-03005385638

S.N Questions Response/Answers 1. What Role Professionals (Architects, Town

Planners & Engineers) can play in the provision of Affordable Housing for the moderate to low income households?

2. Do you think that the present supply of Housing is enough to cope with the demand of affordable Housing, if No, what measures should be adopted to cope with demand?

3. How much, the present Land use/Zoning regulations & building regulations are supportive to the development of affordable Housing and what other improvements are required in this regard.

4. To what extent, National Housing Policy's Measures are being implemented and effective to meet the needs of Affordable Housing, OR what kind of measures to be adopted to be incorporated in policy for making it practical implementation for the provision & development of affordable housing for the moderate to low income households.

5. What are the reasons for the growth of slums/katchi abadies, and how it could be controlled/ reduced?

6. What is your opinion about; whether the slums and katchi abadies to be up-graded or relocated to new areas? Please specify the adequate approaches for its effective

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implementation. 7. What kind of Housing will be most suitable

for Poor to afford? (i.e, Rental/ownership and flats/ Row housing etc)

8. What Incentives Government should extend to Private sector and Construction Industry for Affordable Housing development both in quantity & quality for the poor households?

9. What role private sector (developers/investors) can play to share the development of housing for low income people?

10. What role Construction Industry can play in supply of Affordable/cost effective materials.

11. The present land Acquisition laws/system (land transfer procedures/documentation) is adequate to the supply of Affordable land to poor. If not what modifications are required?

12. How the cost of land could be reduced for making it accessible to moderate to poor households.

13. Is the Housing finance system/terms and no of departments adequate enough to meet the demands of Poor Households seeking Finance for housing construction/ improvement. What measures to be adopted to make it accessible for moderate to low income people? (Interest rate, down payment, proof of income, installments, etc)

14. Are the available Professionals and labor well equipped for constructing/ designing Affordable /low cost housing? Or training is required to produce such manpower?

15. What kind of appropriate skills and construction techniques could be adopted for cost effective solutions to affordable and durable housing for moderate to low income households?

16. What role public-private partnership can play in the development & provision of affordable housing?

17. What are the reasons for poor quality low cost housing, and how it could be improved?

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18. What other measures/approaches could be adopted to reduce the cost of housing for making it accessible to poor.

19. Any other useful opinion, you would like to give; that how the above issues could be adequately addressed.

20. How the rents of housing units could be made affordable for the moderate to low income households.

21. Is there any insurance policy for housing, would it make any difference for the poor, if provided.

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ANNEXURE-IV

ROAD NETWORK AND RESIDENTIAL AREAS OF MURREE CITY

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ANNEXURE-V

LANDUSE MAP OF MURREE CITY