Rapid economic development in the Asia-Pacific region has lifted millions out of poverty in recent decades. The middle classes are benefiting from increased housing options, but those at the bottom of the economic ladder are still struggling.
By Zachary Frye
The 7th Asia Pacific Housing Forum will take place in Bangkok from September 16 to September 19, 2019. The event is being organized by Habitat for Humanity in collaboration with the World Bank, Red Cross, and UN-Habitat, bringing together experts, academics and practitioners to influence stakeholders on the issue of affordable housing.
At a panel discussion prior to the event, Pornwarit Chounchaisit, president of the Thai Real Estate Association, outlined the importance of multi-sector collaboration in dealing with regional housing issues.
“Resilient and affordable housing should be treated as a basic necessity for human beings. This is why it is not only the responsibility of the public sector but must be a collaboration between organisations, both public and private, to positively affect the low-cost housing sector,” he said.
Marginalised families bear the brunt of inadequate housing
In 2015, Jakarta police fired tear gas into a crowd of slum dwellers who were being forcibly evicted from their homes. The residents were hurling Molotov cocktails and stones at the police as the government moved to clear out the area.
The area was deemed unsafe due to its incidence of high-flood water, and most lacked the necessary paperwork for compensation. This wasn’t an isolated incident. Indonesia has a history of forced evictions disproportionally affecting the urban poor.
The story of Eva Sugiharto, an evicted resident of another Jakarta slum, exemplifies the injustices that many Indonesians – and other families across Southeast Asia – have faced living in inadequate and unregistered dwellings.
“Around 7 or 8 a.m., the military arrived. Altogether, there were about twenty military officers and some police – I saw them directly because I was already up and outside,” she said. “Then I heard the sound of the bulldozer. I heard it, I came out of my house and saw that it was digging out the front of the complex, and I said, ‘Oh my God, this is happening… We were forced to leave the location.”
The region’s poor are struggling to find housing, especially in cities
As ASEAN’s economies further integrate themselves in global markets, the upper and middle classes are growing. But across Southeast Asia, impoverished citizens are getting left behind. Despite strong economic growth and declining poverty rates, there are stubborn gaps in access to decent low-income housing.
Speaking with ASEAN Today, Jennifer Oomen, the Associate Director of Market Systems and Entrepreneurship at Habitat for Humanity Asia-Pacific, highlighted the ways urbanization is creating a housing crisis for the lower economic classes.
“From the supply side, rapid urbanization is also pushing housing costs up in relation to rising costs of land, construction and lack of adequate housing finance options for low-income households.”
To help work towards a more inclusive and sustainable housing situation, the UN devised an urban policy framework dubbed ‘The New Urban Agenda.’
In the context of the UN’s Sustainable Development Goals, it seeks to forge a future where “all people have equal rights and access to the benefits and opportunities that cities can offer.”
Increasing social inclusion is a worthy goal, but it will be difficult to implement without a shift in priorities from the private housing market.
The housing development market is heavily weighted towards the middle and upper classes
Skewed market incentives are leading to deficient living options for low-income families.
“Out of the more than 1.6 billion people experiencing inadequate housing worldwide, 500 million people live in informal settlements across Asia,” says Ms Oomen.
“There is a massive housing demand in the region, but this is largely left to the market to meet, catering mostly to middle-income brackets and above.”
“Government subsidy and corporate social responsibility alone cannot address the gap in the market,” she added.
In order to make the most positive impact in the coming years, public-private collaborations – and shared values – will be paramount.
Governments and the private sector need to put sustained attention on low-income housing
According to UN-Habitat, housing has not been a strong focus of international and national policy agendas over the past 20 years.
To ensure that the most vulnerable in society get fair access to decent housing, it’s imperative that governments prioritise housing development policies. Tax subsidies, equal access to credit, and increased investment in housing services are important tools that governments can use to help incentivise fair access.
Strengthening tenure laws would also be helpful. Often, slum-dwellers or those in informal living arrangements are ostracised from city services and job opportunities. Integrating these communities into city life would increase the security of impoverished citizens and legitimize their contributions to local economies.
Crucially, however, governments will need to work with the private sector to ensure low-income housing needs are met in the most efficient manner. Although public housing can be a supplement to private sector developments, governments cannot solve the problem alone.
Planning frameworks start with the government but are mostly navigated by the private sector. Legal mandates for mixed-income housing units, incentivized by government subsidies, are one example of a possible way forward.
Singapore has found success in its housing policy by implementing a bottom-up approach. Its private housing market is strong, but it works within successful housing-related investments and regulations.
One of its signature housing policies, called the Central Provident Fund, facilitates equal access to housing by mandating a compulsory housing savings tax. Working through a government-appointed board, the money is routed to commercial banks, which then gives reduced mortgage rates to low-income homeowners.
The possibilities are there to create a more inclusive and sustainable housing market for all, but it will take political will to get it done. Regional economic growth is a boon, but it means little to the classes of working people who still struggle.