Broken Cities: Inside the Global Housing Crisis 9781350218789, 9781786990556

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List of figures, tables and boxes Figures   2.1 Housing affordability curves for households in a private-sector-financed scheme in Harare   2.2 Typical wages and average rents in England and London in 2016: the housing dilemma illustrated   4.1 UK housing completions per year by tenure, 1949–2015   4.2 Plot layout in an informal housing area in Kisumu, Kenya: landlord and tenant housing and services   8.1 Income distribution by quintile in the UK in 2016

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Tables   3.1 England and Wales 2006 Housing Health and Safety Rating System (HHSRS): potential influences on ‘The basic physical and mental needs for human life and comfort’   9.1 International long-term and internal migration: London and south-east England, 2014–17 10.1 Real (formal) house price rises in 2017–18 and house price to income ratio for 2010–18 in selected countries A1 Bloomberg Housing Affordability Index 2018 A2 Share of households in bottom quintile of income distribution paying more than 40% of disposable income on total housing cost, by tenure (where data available), 2010 and 2014 (or latest year available)

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List of fig ure s, tab l e s and b o xes

Boxes        

2.1 3.1 3.2 5.1

The benefits of RDP houses in South Africa Dickens’ slums Desperate slums in Limerick, Ireland in the 1930s Landlords’ intermediaries: rent collectors and evictions   7.1 Fighting for their rights: the communities of Dharavi   8.1 The conversion of offices to slums in the UK

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Foreword

In 1978, shortly before the era of neoliberal capitalism was imposed on urban societies across much of the world, I began researching urban processes and livelihoods in southern Africa. Over the decades I researched and taught about urban livelihoods, low-income housing, the changing characteristics of migrant households and of migration patterns both to and from cities, and the role and nature of so-called informality in employment and housing. In particular, I spent much time and conducted major surveys in low-income neighbourhoods in Harare, the capital city of Zimbabwe. Along with the surrounding countries of Malawi, Zambia and South Africa, almost every type of low-income housing policy in fashion for the cities of the Global South from the late 1970s to today were practised with varying results. Most were promoted as ‘affordable’; very few were. Zimbabwe and South Africa were both ruled by white minorities when I began my academic career. This meant that they also had, most unusually for sub-Saharan Africa, significant provision of public rental housing that was affordable in so-called ‘townships’, although its main original purpose was for political control of migration and black African urban residents. In the UK, I live in the borough of Haringey in north-east London. I moved there in the late 1970s at a time when the issue of housing affordability per se in the UK had largely been solved by the cumulative outcomes of state intervention over many decades, but particularly since the end of the Second World War. The ward in which I live is culturally diverse and constantly changing. Haringey has some very wealthy residential areas, some much poorer areas, and everything in between – a comprehensive range of the various private- and public-sector housing types to be found in London outside the city’s central (and ludicrously expensive) areas. As with x

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many of London’s residential boroughs beyond its historic centre, Haringey’s phases of rapid development in the late nineteenth century, from a peri-urban mix of land uses, including agriculture, to a densely built urban housing environment, followed the geography of the new underground railway lines. I have rented in the private sector in Haringey (and elsewhere in London), experiencing the usual range of eccentric and sometimes venal landlords, dangerous exploding water heaters and bizarre fungi and moulds that renters may encounter in that sector in the UK, albeit at a time when the rents were affordable. In the early 1980s, just as the first round of massive upswings in London house prices began, I bought a dilapidated terraced house. This had been divided into five bedsits by the previous owner and did not comply with most of the statutory housing standards. Today, it is worth a fortune because of subsequent rounds of surges in house prices in the UK’s cities, and particularly in London. It is utterly unaffordable to the sorts of households who were buying in the area in the 1980s. Their typical employment and related income profiles, and reliance entirely on mortgages and 10% cash deposits, would not buy a house in Haringey today. Over the decades, my lived experience in north London and various cities in southern Africa, alongside my research and teaching on housing, increasingly led me to see the issues underlying housing outcomes and the issue of affordability in these areas, and elsewhere in the urban world, in terms of their structural similarities rather than their differences, albeit always shaped by specific local histories and politics. The crisis of housing affordability across the world’s major cities has also deepened and become more embedded. These are the issues that led to this book. In the following chapters examples are drawn from across the world but particularly from southern Africa and from London. A deliberate effort is made to illustrate problems and policies with reference to cities outside Europe and North America.

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Chapter 1

The dilemma of affordable housing and big cities

Introduction Generation Rent in London and divided families in South Africa; dormitory living in Shenzhen and the favelas of Rio de Janeiro; squatters on the edge of Lisbon and cage housing in Hong Kong. What do these situations have in common? The answer is obviously that they are urban housing ‘problems’. But can they be understood as manifestations of the same underlying urban processes? Much work by scholars and policymakers argues that the common problem is to do with a shortage of housing, sometimes linked to shortages of urban land for residential housing. This conceptualises lack of housing in cities across the world as a supply-side problem – the obstacles to the provision of housing for all are constraints on supply. If enough houses were built, prices would fall into line with demand: the magic of the market, of the invisible hand, would provide the solution. The key argument of this book is that that approach looks at the housing crisis – which is manifest across the urban world, and most particularly in the largest cities, where economic opportunities are apparently greatest – from the wrong end of the telescope. The real problem is demand. This sounds strange, perhaps, since evidently nearly everyone ‘wants’ a home – a place of shelter and privacy, a 1

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place for family life and socialising. But that is not ‘demand’ in the sense that much contemporary policy across the world can currently handle. Instead, demand must be expressed in terms of money. So while it is universally accepted that people need housing, they can only live in what they can afford. Some discussions about housing ‘demand’ can be meaningless. One set of protagonists may be expressing their arguments with reference to the norms of modern urban societies, whereby demand for housing is basically expressed in neoclassical orthodox economic terms (prices). Others may instead be referring to evidently expressed needs or ‘wants’, which, confusingly, can also be termed ‘demand’. It helps when it is recognised that housing is not that different from other basic needs, such as food. Obviously, for example, there is no shortage of food in Britain, but, as has become increasingly the case since the financial crisis of 2008, many people even in that country cannot afford enough food. No one argues that this is a supply-side issue. Thus, there is a housing dilemma. This term, which is central to the arguments developed in this book, relates to the problem that housing demands from some income groups can be met by the market but that housing needs from many in poorer groups cannot. The views about urban housing developed in this book are underpinned by specific premises about contemporary conditions affecting urban policies and processes. Fifty years ago conditions were different. The issue of affordability that related to monetary demand was less determinant in urban housing problems across the world, in part simply because there was far more provision of nonmarket housing for the poor. A fundamental reason was that there were different modes of production operating in different regions. The ways in which people got access to urban housing varied accordingly. In China, the USSR, eastern European countries and Cuba, communist modes of production and ideologies meant that housing was assured for most workers and provided by the state. It was generally affordable since the costs were not determined by market forces but set by the government in line with typical incomes. Furthermore, in wealthy capitalist societies in the Global North (or ‘the West’, as these were then labelled), there was usually some provision of social housing for urban low-income workers and their families. The rents 2

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in such housing were deliberately set at rates affordable for those on typical pay levels. This meant that they were usually well below market prices. Private rental sectors were also regulated in ways that helped control rent rises. When hundreds of millions of urban residents whose incomes were in the lower deciles of national income distributions were housed in these ways, the role of affordability in understanding housing crises was evidently far less dominant. But these conditions no longer pertain. Based on current circumstances, there are five key premises that shape the arguments of this book. These are taken to underpin contemporary low-income housing problems in cities across the world. The premises are introduced below. They will be referred to frequently and developed further in later chapters, and it is helpful to set out at the start why they are felt to be of fundamental relevance to understanding these problems.

Five key premises 1. The global reach of capitalism

The first premise is the current hegemony of the capitalist mode of production across all global societies. This is not to say that there are not important variations in the way this is practised in different countries – this is absolutely accepted and is indeed a key reason why urban housing outcomes vary. But the fundamental elements of capitalism – the operation of market forces via the factors of supply and demand to determine incomes and prices, the protection of private property, the quest for profit and the related essential requirement for continuous geometric expansion of production and accumulation of surplus value – are broadly speaking now in place across the world. The ending of communism in the USSR and eastern Europe has brought those societies into the capitalist fold. South-East Asian countries such as Vietnam and Cambodia that also had non-market philosophies and economies have likewise become market-oriented. The most important outlier remains China, but there have been remarkable shifts here also. It has adopted many of the main principles of capitalism, including private property, 3

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and market forces increasingly influence the allocation of resources and patterns of production and incomes. However, China’s mode of production is still best described as state capitalism, rather than free-market capitalism, and its cities and housing patterns remain unusual and exhibit some features in housing provision that flout the ‘laws’ of market forces and profit-driven decision-making. Notwithstanding some exceptionalism in China, the hegemony of capitalist principles is now sufficiently global for these to be understood as the underlying forces determining urban housing outcomes. This does make comparative analysis easier. This precept may seem obvious but the basic requirements of capitalism are often ‘forgotten’ by policymakers devising housing programmes. For example, tremendous efforts have been made in Global South urban housing programmes to involve ‘big’ capital – banks, building societies and large construction companies – in the mass provision of planned and legal (formal) low-income housing. But it rarely works. Sometimes the governments involved berate the privatesector actors for the failures; sometimes analysis is directed towards the idea that there must be some market imperfection. The inability of poorer groups in cities in the Global South to obtain housing finance from formal lenders is usually seen as ‘a problem’ that needs to be solved. But analyses of this sort ignore the basic precepts and these presumed solutions can never achieve their goals. The essential problem is more obvious: capitalist banks and building societies have to operate profitably – it is their raison d’être. And they have responsibilities to shareholders and savers. They can lend money only for houses that are formally built in planned locations with permanent, approved materials and full services, and with tenurial rights recognised by capitalist institutions. These are the conditions that allow the lender to foreclose if the loan is not repaid, resell the property and thus get all or some of their money back. But these are some of the very conditions that make housing expensive and unaffordable for the poor. The gap between the income needed to live in ‘decent’ legal housing and the typical incomes of the poorer groups governments and development agencies are so keen to see properly housed is very obvious to private financial institutions in many cities in Africa, Asia and Latin America. 4

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So they do not lend to them because it would be exceedingly risky or very clearly would not be profitable. It is pointless to expect the large-scale private sector to lend money for housing to groups that it knows cannot pay that money back and/or whose tenure does not conform to the norms of capitalist private property. This is a circle that cannot be squared unless the iron rules of the market are set aside and the state intervenes with subsidies that make the processes profitable for the private-sector actors involved. This does work. However, it simultaneously proves the point: poor urban families cannot afford to be ‘formally’ housed under market conditions, and now that market conditions are globally hegemonic, this must be the starting point for all analyses of housing problems. An objection may be raised to the argument that the capitalist private sector cannot deliver ‘affordable’ housing for low-income groups on the grounds that this is not so obviously the case in the wealthier societies of the Global North, and that the lending practices of financial institutions in the USA and Europe during the early years of the twenty-first century disprove the point that such capitalist institutions will not lend to poorer groups for urban housing. To the contrary, however, the absolute disaster that followed in 2007–08 with the global financial crash proves the point entirely. First, the iron rules of the market did eventually assert themselves and demonstrated in the most destructive fashion that lower-income groups even in the Global North could not afford private-sector housing. And second, the housing circle was, as usual, squared by massive intervention, at almost unimaginable levels, into the markets by the state sector in these societies. Trillions of tax dollars were poured into the financial institutions involved in housing loans. They were saved and a massive global depression was avoided, but the world has still not recovered from the colossal debts imposed on states and the austerity programmes that followed. 2. The impact of the neoliberal phase

In the 1980s a new phase of capitalism based on neoliberal ideology began to replace the more regulated and state-interventionist types of capitalism that had been typical in post-war Global North 5

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societies. The second premise is that this neoliberal turn exacerbated the urban housing issues that will always exist in a capitalist society. It should be noted here that a distinction is being drawn between the impacts on urban housing of the essential requirements of any variety of capitalism, as discussed above, and the conditions encouraged by neoliberal capitalist ideology. This is analytically helpful, as, quite rightly, urban scholars critique the idea that neoliberalism is at the root of all inequalities and urban problems, especially given that many of these pre-date the 1980s. In essence, the neoliberal turn promoted a much stronger reliance on market forces for determining how resources were allocated and a much reduced role for government. Public expenditure came to be seen as something to be cut wherever possible. Given the situation outlined above whereby it is largely inevitable that affordable formal-sector housing for poorer people is achievable only through state intervention in the market, the problems that neoliberal ideology create for urban housing are obvious. In both the rich and poor parts of the world the same processes emerged. Governments and development agencies of all types sought to find ways to impose full cost recovery on housing programmes for the poor at the very least, and preferably to shift the burden of provision to the large-scale private sector, which, it was argued, was more efficient and skilled due to the disciplines imposed by the requirement to make a profit. Unfortunately, that is the very requirement that simultaneously makes affordable low-income housing impossible for the private sector to provide. Functioning and long-standing public-sector large-scale provision of affordable urban housing – such as council housing in the UK – was also deemed to be inherently wrong under the new ideology because it was not market-oriented and was such a significant element of government budgets. As a 2017 EU report, The State of Housing in the EU, states: ‘In most cases policy responses at Member States level have been to decrease public expenditure for housing and … [to rely] on measures to increase the supply in the private sector or access to homeownership.’1 The gradual undermining and reduction of the public sector across the Global North has served to

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make the crisis of the shortage of affordable housing in cities very much worse. Recognition of the ideological underpinnings of this situation is crucial – the conditions are not inherent in the way that the profit motive is for capitalism as a mode of production – these are political choices about what is claimed to be ‘right’. Since subsidies are seen as inherently wrong, and somehow even dangerous, this has created a fundamental constraint on the types of affordable housing solutions deemed acceptable and limits the policy conversations that are possible. 3. Segmented housing demand

The simple logic of the rule that prices are set by supply and demand is the default mindset of most housing policymakers and housing analysts. But the understanding tends to be simplistic. The general argument made is that the more urban housing is built, the lower the prices will become, and that this means that eventually they will become low enough to be affordable for the poorer groups. This mindset relates to the formal, planned housing sector – the messy unplanned markets of informal settlements in the Global South are deemed to be ‘problems’ that might be alleviated by the achievement of affordable housing in the formal market system. For the sake of argument, it helps to set informal housing aside at this point. The focus for the moment is on the planned and legally constituted housing markets. It is also understood by most analysts that because houses actually have to be located in particular places, unlike most other goods, then the provision of urban land for housing is an essential element of the supply and demand equation. Indeed, inadequate provision of planned land – lack of land supply – is often pinpointed as the reason why housing is unaffordable for so many urban families, shifting the focus to land rather than buildings. For pro-market protagonists, this also has the benefit of shifting the ‘blame’ onto governments, since these nearly always play key roles in determining which urban land can legally be used for new housing, and away from the constraints imposed by relying on private profit-oriented suppliers.

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The land issue is important but it is not the panacea so often assumed. The problem is that it is quite possible – indeed it is common – to have land occupied by empty housing units, including new-build houses, across a city at the same time that many poorer groups cannot afford to buy or rent legal, planned housing. The issue that is insufficiently recognised in the simple supply/demand analyses, or possibly dismissed because it is an ‘inconvenient truth’, is that housing markets are segmented. Increasing the supply of most types of housing makes no difference to the housing problems faced by the poorer groups as they cannot afford ‘most types of housing’. This is true in poor and rich countries – the same processes play out whether you are in Harare, Zimbabwe or Haringey in London, places with which I am deeply familiar (as noted in the Foreword). Housing that is affordable for such groups is a different sort of housing with a separate set of market conditions. This makes the measure­ ment and conceptualisation of what is ‘affordable housing’ deeply political. The significance of segmented markets is well developed in studies of labour and migration to cities, especially international migration to global cities.2 It is obvious that there are different types of labour (skilled, semi-skilled, unskilled) and that, in any one city, demand for each type will vary. If internal labour migration cannot meet demands, then international migrants may fill the gaps. But the gaps are specific – the classic division being between demands for very low-paid service-sector workers (such as cleaners) because insufficient numbers of local workers will (or can afford to) work at these pay levels, and separate demands for highly paid skilled professionals (in IT or the finance sectors, for example) where a lack of domestic supply is ‘real’. As research on the associated migration streams demonstrates, these different groups are treated very differently in terms of immigration laws, etc. And just as there are segmented markets in labour, there are segmented markets in housing. In the same way that a plentiful supply of skilled financiers will not meet any unmet demand for poorly paid cleaners, increasing the supply of housing types that can be afforded only by those in the

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top income distribution bands cannot meet any unmet demand for cheap housing for those in the bottom bands. 4. ‘Decent’, ‘legal’ housing

Having argued that profit-oriented private suppliers cannot meet the demand for urban low-income affordable housing, it is now time to point out that, in fact, this is easily disproved! In most cities and towns across the world, informal markets provide millions upon millions of housing units, both for owners and renters. The market does work. But this is precisely the sort of housing that is so frequently labelled ‘a problem’. Often the argument outlined and criticised above – that the answer is to increase the formal supply of legal zoned land and thereby housing – is trotted out as the solution to this problem. The mistake is to cordon off this ‘housing type’ analytically as something peculiar to, or inherent in, societies of the Global South and of no significance for urban housing studies in the Global North. For it is neither peculiar nor irrelevant. In the eighteenth, nineteenth and early twentieth centuries, European and North American societies had plenty of exceedingly poor-quality urban housing, usually in the rental sector. It certainly rivalled, and often exceeded, the worst housing conditions experienced in urban slums across Asia, Africa and Latin America today. But at the time the concepts of ‘informality’ and ‘legal standards’ in relation to housing (and indeed labour) were not current or were in the process of being formulated. This is why the premises outlined so far are scattered with these terms (‘informal’, ‘formal’, ‘legal’, ‘zoned’, ‘planned’), because these are key to understanding not only the differences between affordable housing issues in the Global North and the Global South, but also the similarities. For very good reasons, as they grew wealthier and more democratic, Global North societies gradually imposed regulations and standards on housing quality and invested in major urban water and sanitation infrastructure. Their urban housing sectors were transformed, low-income people’s welfare as measured by health

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outcomes soared, and these ‘standards’ have become embedded as norms that are often underpinned by judicial obligation. Meeting these standards costs money. In the capitalist societies of the Global North, the norms of private property rights are also embedded, and this adds value to housing and therefore also increases its cost. These conditions are taken as read in most housing studies in the contemporary Global North. The question of what might occur if these conditions were not, or could not, be maintained is rarely factored in. The answer to that question would be that an informal housing sector would emerge which would provide affordable housing for low-income groups, just as in the cities of the Global South and just as in the cities of nineteenth-century Europe and North America. Such housing would replicate the ‘problems’ that the formal-sector norms were designed to address. In other words, the basic premise is that the market cannot deliver affordable housing for the poor if – and the following two points are the big ‘ifs’ – even very basic standards of space, privacy, services and health commensurate with local laws are met and housing delivery is presumed to be done by a regulated, legal, taxable building sector. 5. Social housing

The final premise is simple: if the conditions above are met, then ‘formal’ social housing (priced below the levels set by the market) has to meet the demand for affordable housing from low-income urban groups. This housing sector is the central ameliorating factor that addresses the mismatch between incomes and ‘decent’ housing in urban societies across the world, in the cities of both the Global North and the Global South. The type of provision (from built rental units to subsidised, legal, planned but empty plots for ‘selfbuilding’) varies across time and space. But much of this has been squeezed in the neoliberal phase since the 1980s and with the global shift away from public-sector provision and subsidies and towards full cost recovery. The terms ‘housing affordability’ and ‘affordable housing’ are used above and throughout this book because they are commonly understood to refer to the situation in which households are 10

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struggling or unable to pay for fairly basic housing. Nonetheless, they are not really straightforward and it helps to consider this issue before proceeding. Before the 1980s, for example, policy discussions might focus more explicitly on ‘low-income housing’, making clear the crucial link between housing problems and incomes. According to the late Michael Stone, Professor of Community Planning, Public Policy and Social Justice at the University of Massachusetts Boston, it was only in the 1980s that ‘the term “affordable housing” came into vogue as affordability challenges moved up the income distribution and as public responsibility for the plight of the poor was in retreat’3 – in other words, it can and has been used to obscure the issue. Nonetheless, as long as it is recognised that affordability is about a relationship between people and whatever they need to buy, rather than the ‘thing’ itself, the terms are useful, and they are very widely used by the public, academics, the media and advocacy groups in this sense.

Housing processes across time and space: recognising the links These five premises about housing provision and outcomes relate to the sharp end of housing crises. There are sections of society that are wealthy, or have well- or reasonably remunerated stable employment, for whom private-sector, capitalist housing markets may work well enough. But there are scores of different societies across the world, and the proportion of housing demand that can reasonably be served in this way is highly variable between them. For those outside this segment of housing demand, relying on the market can lead to very negative outcomes or no housing at all (i.e. homelessness). And within each society, or country, there are many urban centres with highly variable patterns of income. The geographical expression of demand-side housing problems is therefore very varied, both between and within countries. There are also temporal variations. The situation can worsen or improve – there is no steady direction of change. Over time, there can be huge changes in the type of housing ‘allowed’ by governments and falls 11

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or rises in disposable incomes before housing costs are factored in. Such changes can significantly shift the proportion of urban households whose incomes are too low for them to meet their basic housing needs in the housing markets they face. A current example in England is the sudden steep rise in the numbers of adults living with their parents in the south-east, and particularly in London, as rents or mortgages have become increasingly unaffordable for people in income bands who, before the global financial crisis, were reasonably served by what the market provided. The geographical variability of the scale of really chronic housing issues across the world and the obvious differences in the outcomes, particularly in terms of highly visible, large expanses of what are often labelled ‘slums’ in many cities of the so-called Global South, can easily divert attention away from the underlying processes at work. The influences on the nature of the supply of housing are indeed so variable that it sometimes seems impossible to make meaningful comparisons between regions. Modal (rather than average) income levels, the specific requirements of local financial institutions, land laws, car ownership, public transport, land values that encourage particular types of building (e.g. high-rise versus low-rise), culture, technologies, materials, the weather – these and many other factors all play a part. A further and crucial factor is the history of state interventions in housing markets. Yet a focus on the nature of housing itself – what is ‘supplied’ and its tangible qualities – often leads to an almost binary approach to the study of urban housing in the Global South versus the Global North. In the former, the focus is on so-called slums – although, in reality, this is better understood as the outcome of informality in housing provision of various types4 – and the problems tend to be cast in terms of ‘development’.5 Since these types of housing outcomes are far rarer in the Global North – at least in modern times – the focus in housing studies there is on the workings of formal, large-scale private-sector housing markets (e.g. new private housing provision or gentrification) and the role of the state in providing social housing at below-market rates. As the problems literally ‘look’ different, the analysis splits into separate camps. However, when housing problems are recast primarily in terms of problems with demand, the seemingly vast differences between 12

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these issues in poor and rich countries – the cities of the Global South and the Global North – that frequently seem to prevent any realistic theorising become more manageable. The expanding field of comparative urban studies calls for urban theorising that is not based solely on the norms of cities of the Global North, and for insights developed from real situations in any part of the urban world to be tested for their theoretical applicability to broader global urbanism. Comparative urbanism also eschews the old binaries of Global South and Global North, developed versus developing, and helps lay bare the impacts of global structures of power and financial flows on cities while constantly also reminding us of the need to recognise the influence of local histories, politics and cultures.6 The use of the terms ‘Global South’ and ‘Global North’ throughout this book may be thought to undermine this. However, for the sake of brevity they serve as a useful device for referring to regions and countries with relatively low or high per capita incomes, which are a factor of key significance for the scale of the housing dilemma, if not the underlying structural causes. It is also a shorthand – though perhaps an increasingly unnecessary one – for societies that are towards the opposite outer edges of what might be described as the normal curve distribution of contemporary urban experiences and outcomes. As these increasingly blur, more and more cities cluster towards the middle of the curve, where these terms become less useful. Identifying and discussing such blurring with respect to housing is one aim of this book. Nonetheless, understanding the nature of the housing dilemma also requires a historical perspective, and the economic history of the cities of the Global North, from the emergence of mercantile capitalism centuries ago and through the subsequent centuries of imperialism and colonialism, is very different from most of those in the Global South. A key reason was the imbalance in political and economic power between them and the consequent unbalanced accumulation of surplus value in the urban Global North. Thus, the relative wealth of these regions, which has so influenced past urban processes, problems and possible policy solutions, is a product of their unequal relationships. The nature of the colonial encounter also determined many aspects of urban housing policies and outcomes in colonial cities, the legacies 13

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of which are still evident today. For all these reasons, these regional descriptors – hereafter GN and GS – will be used where they assist the analysis; they are also needed to demonstrate where common generalisations based on presumed differences between their urban housing problems can be challenged. The arguments made in this book have also been influenced by long-standing research based in urban Africa, as explained in the Foreword. Three particular aspects of studying and teaching on housing in regions such as Africa have helped shape the perspectives underpinning this book. First, GS urban housing studies (and indeed research on many other aspects of societies in the GS) tend to focus on, or incorporate, poverty as a key factor in any analysis. Indeed, it can be hard to obtain funding for research that is not, at least ostensibly, pro-poor. This is often, and understandably, seen as a barrier between any insights and theorising based on such work being drawn on by the more powerful and established theoretical scholarship of the GN. After all, far fewer people in the cities of the GN are that poor, as, for the reasons discussed above, their societies are generally wealthier. Yet the focus on poverty can have its advantages. Much work in the cities of the GS starts from the position of understanding patterns of livelihoods and incomes in such cities. This provides a different perspective because it often demonstrates that the key to interpreting urban housing problems is affordability. People’s incomes determine what sort of housing they live in. For many – sometimes most – urban families, this means that formally built housing, of adequate size and construction type, in safe locations with reliable services is completely unaffordable. So they do not live in it, no matter what the conditions of supply. These sorts of conditions are quite typical of much of urban sub-Saharan Africa. Also, as the shape and scale of very large urban settlements and their economies shifted in Africa and the world entered the phase of being mainly urban, it became increasingly clear that the most pertinent insight about housing problems in African cities was not about how they differed from those elsewhere, including in wealthier societies, but about recognising the similarities. A particular issue in Africa has been the profound lack of legal, planned housing (‘formal’ housing in development-speak) that both 14

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meets some basic requirements to allow healthy living, including adequate space, and is affordable for very significant proportions of the urban population. This brings us to the second way in which working in African cities forged insights that have wider application. This is the role of what is called ‘informal housing’, which, for the moment, can be taken to mean housing that is not legal or planned according to the laws and plans of the city authorities (even if it is widely perceived to be legitimate by local societies and on such a scale that it is unlikely to be demolished). Yet again, the presence of widespread ‘informality’ in the cities of the GS is usually felt to hinder comparisons with planned and regulated cities elsewhere. In the GN, it is assumed, slums and squatter settlements are things of the past and of little relevance to contemporary urban understandings. But the point is that they did indeed exist in the past. Classroom discussions about such housing types in Africa soon lead to discussions about why slums occurred in London or New York, or squatter settlements were found around Paris, or shack settlements around Chicago. The reasons were the same – the costs of decent and/or legal housing were beyond large sections of the population: their incomes were just too low. At the time, the laws and regulations that can be used today to label contemporary urban housing ‘informal’ may either not have existed or not been enforced, but the underlying mechanisms leading to people being housed in these ways were essentially the same as they are in the cities of the contemporary GS. Thus comparing across time rather than just across space puts the role of ‘informality’ in housing outcomes into clearer perspective. Once it is recalled how badly most of the working classes used to be housed in the GN, the next logical step is to think about why and how these housing types are no longer prevalent. The answers involve a combination of changes that emerged over a period of time. The actions of the state and of private philanthropists (many of whom had made their fortunes from workers in the rural GS and the urban GN who were housed in very poor conditions) were crucial. Official slum clearances had complex rationales and were hardly pro-poor, but the development of model, subsidised inner-city housing estates by actors such as the Peabody Trust in London clearly were. GN societies also became wealthier, the 15

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share of the population who were extremely poor shrank and the size of the middle classes whose housing needs could be addressed by a modernising private sector expanded apace. In addition, the state provided more income support of various types such as pensions, child support, unemployment benefits, free education and eventually state-supported healthcare for varying proportions of the population. As poverty levels reduced, the share of the urban population who could manage rental costs for ‘decent’ housing (compared with nineteenth-century norms, at least) increased. Nonetheless, significant proportions of urban people in the GN in, say, the 1960s and 1970s were housed in social housing, many in the private rental sector could manage only because of state interventions such as rent controls or housing support payments, and house purchases for some lower-income groups, particularly in the USA, were also only possible through state support. This brings us to the third and final comparative point that emerges from considering urban low-income housing characteristics in the GN from the perspective of urban housing situations in the GS. This is that it is only the availability of a segment of non-market-priced housing in GN cities that prevents mass recourse (again) to the sort of insecure and inadequate housing that is now sometimes assumed to be uniquely characteristic of the GS. In other words, the underlying conditions that can lead to urban people living in such housing are universal. And the problem lies in the workings of another set of market forces, this time in labour markets. Thus, in nearly all urban societies today, in both the GN and the GS, most people’s incomes are determined by the forces of supply and demand and for very many types of work in all cities the price for their labour is simply too low to cover the cost of formal-sector, ‘decent’, secure housing. What they can afford is informal-sector housing, but it is this sector’s very insecurity and frequent lack of properly functioning services, space and privacy that makes it cheap and affordable.

16

Chapter 2

Mismatches between incomes and housing costs: a global condition

Introduction In 2016, UN-Habitat, the United Nations Centre for Human Settlements, produced its first global review of the world’s urban settlements: the World Cities Report 2016.1 Housing was identified, rightly, as being key to the future of cities. It was reported that, in 2010, 980 million people did not have decent housing and 600 million were expected to be added to that total by 2030. Between 2000 and 2014, the population living in slums, as defined by the UN,2 had increased to 881 million. While there had been improvements over the preceding 20 years in access to piped water and electricity in most countries of the Global South (GS) (although less progress with sewerage) and the share of the world’s urban population in slum conditions had fallen from 39% to 30%, these improvements have been geographically very uneven. Sub-Saharan African countries generally still have very inadequate urban infrastructure for the majority of their urban populations while many South American countries have achieved water, sewerage and electricity connections for most of theirs. The physical inadequacies of much urban housing across the poorer parts of the world are widely acknowledged and reported, so, in a sense, these aspects of the report were unremarkable. Most data in the report’s 17

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statistical annex relate to housing quality (exclusively in the cities of the GS) and economic indices such as inequality and poverty (again, only for cities in the GS, apart from data on some eastern European countries), urban gross domestic product (GDP), employment and pollution. However, although poor-quality housing may be an indicator of ‘broken cities’, it is not the same as unaffordable housing – indeed, unfortunately they are often inversely correlated – so data on the incidence of inadequate housing do not necessarily provide much insight into the struggles many urban households face over housing costs. Nonetheless, in a short two-page section of the 264-page report there is a strong argument made that: affordability is the crucible of housing policies … In many developing countries, despite all efforts to reduce costs, enhance efficiency and improve design, basic formal sector housing is too expensive for most households … [the] time has come to recognize that, especially in much of Sub-Saharan Africa, the main problem is not that housing is too expensive, but that incomes are too low to afford basic formal housing.3

This was radical and a step change from the broadly neoliberal and pro-market flavour of global agency analyses of urban housing problems over the past three to four decades. On the other hand, this section focuses mainly on the GS. Given the worldwide nature of the housing affordability crisis and the increasing prevalence of the issue in the largest cities of the Global North (GN), this uneven treatment is unwarranted. There is unquestionably a difference in the scale of the problems but the underlying issue of the mismatch between many people’s incomes and formal privatesector housing is the same. Reference to rising rates of housing unaffordability in New York is found in another section on urban inequalities, however, contextualised by the facts that one in five of the city’s population cannot afford to feed themselves without food assistance and that one in three of the children of New York live below the locally defined poverty level. The time might also be coming when tables on the incidence of slum conditions across the world should include data for GN cities, as more people find

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themselves in seriously overcrowded accommodation or faced with insecure tenure (either of these being sufficient to be classified by the UN as living in a slum). This would no doubt be highly contentious; such cross-country data are also always fraught with difficulties, given the different definitions used for parameters such as ‘overcrowded’ or ‘insecure’ and differences in the ways in which data are collected. There are even more difficulties with measuring housing affordability, which, being a relationship between individual households, their incomes and their housing costs, makes the compilation of internationally comparative datasets covering all types of housing and income groups very problematic. The debates about the complexities of defining affordability in relation to housing are deliberately left to the concluding chapter as they are better understood once the historical and geographical parameters of the affordable housing dilemma have been established. Suffice it to say at this point that the comparative datasets available tend to focus on formally provided housing in the private sector and often fail to capture the income groups for whom housing costs are most onerous. The purpose of this chapter is to set the scene with regard to the housing affordability crisis for the rest of the book. Case studies are used to introduce and illustrate key aspects of the housing dilemma. Drawing mainly on examples from countries in southern Africa and from London, it illustrates the scale and scope of the crisis as well as key policy aspects, especially the crucial importance of understanding affordability as a product of incomes rather than housing supply. The thorny issue of the influence of building standards (taken up in detail in Chapter 3) is introduced. It is shown how low-income housing projects are usually far too expensive for most of the households they were meant to help. Examples are given of common problems with ostensibly low-income housing projects, which are revisited in later chapters: how market forces cannot provide for the poor, how trends to involve the private sector in such projects make things worse, and how policies that are meant to assist the poor into formal housing – at least in theory – and that are often publicised as such can be hijacked by other groups or are

19

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simply unenforced. It is also shown how more realistic assessments of incomes and affordability can help produce a better understanding of housing affordability issues and therefore better policies.

Learning from southern Africa In 1985 I conducted a survey of almost 1,000 migrant households in Harare, Zimbabwe’s capital city. This was the start of a longstanding research engagement with the country and the city. At that time, socio-economic conditions in Harare were among the best in urban Africa, with high rates of formal employment, rapidly improving social indices and falling poverty levels.4 By 2008, the entire economy had virtually collapsed and the country was experiencing hyperinflation – £1, worth Z$1.6 (Zimbabwean dollars) in 1985, was valued on the parallel market at Z$100 trillion. In the intervening period, Zimbabwe had implemented a full suite of housing policies, influenced by its own specific urban history and the zeitgeist of shifting global economic ideologies, including privatising public rental housing, maintaining high and expensive building standards, upgrading informal settlements, highly subsidised siteand-settlement schemes, and mass demolitions and evictions of ‘illegal’ informal housing. Due to its history as a white settler state until 1980, most urban and peri-urban land had been alienated and commodified, constraining the development of informal settlements. Along with the two other white settler states in the southern African region, South Africa and Namibia, it also suffered extreme forms of institutionalised racial discrimination and segregation. The political imperatives of the ruling white minorities meant that there were strict controls on migration to towns and on the nature of the housing stock, which distorted these countries’ urban demography. In large urban centres, high-income, low-density (and formerly exclusively white) suburbs, similar in many ways to those in cities of the GN, took up most of the space, with the majority black African population squeezed into smaller, segregated, highdensity residential zones (‘townships’) of public rental housing and migrant hostels. These were legal and planned, characteristics that, along with the nature of urban land tenure, were atypical for 20

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colonial sub-Saharan Africa. When white settler rule finally ended (1980 in Zimbabwe, 1990 in Namibia and 1994 in South Africa), a wide range of new housing policies were introduced, partly reflecting the policy fashions of the times and also the need to address the racist legacies of the past. As I travelled back and forth between southern Africa and Europe over the decades, it became increasingly apparent how key global trends in the ideologies influencing housing programmes and weaknesses in policy implementation were working their way through the cities in both regions. These processes, alongside its unusual mixture of housing types and a phenomenal series of changes in the nature of urban livelihoods and the scale of urban poverty, made Zimbabwe a compelling case study for housing research as the impacts unfolded of a very wide range of housing types and approaches and their interactions with income levels and household composition. Neighbouring South Africa also experimented with different types of housing policy after 1994. Its housing experiences include the mass (re-)emergence of informal housing in the last decade or so of white minority rule and a socially progressive attempt to address a severe urban housing shortage post-1994 via a major programme of state subsidies. However, other countries in southern Africa, such as Malawi and Zambia, had more typical colonial histories. Although their urban centres were influenced by racist and segregatory planning, there was less state control and land under indigenous tenure was often available, leading to housing outcomes more typical for countries of the GS, including mass informality. In sum, the southern African region provides an unusually wide range of housing policies and outcomes, shaped by different forms of land tenure, political imperatives, ideologies and policy fashions, making its experiences relevant to wider discussion and theorisation of global housing crises. For this reason, and also to demonstrate how such analysis can draw on cities in any part of the world, the following chapters frequently use examples from southern African to illustrate the causes and outcomes of the housing affordability crisis. In Harare in 1985, after only five years of independent democratic rule, the legacies of almost a century of racist legislation were 21

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still imprinted on the urban landscape. The survey undertaken that year covered five low-income housing areas: Highfields, Glen Norah, Mabvuku, Kuwadzana and Chitungwiza. These were formal, planned and legal settlements with access to physical and social infrastructure such as roads, electricity, water, shops, schools and clinics. The vast majority of the city’s low-income residents lived in such settlements and only a small proportion in areas with illegal tenure. Squatting was rare, as the new independent African government maintained a vigilant battle against housing informality, as had its white minority and racist predecessor. These five areas represented very different phases of housing in the city. The first three were built by white minority governments to house African families. Africans were not allowed to own urban land or housing and the general policy was to discourage permanent settlement by Africans in the towns of Southern Rhodesia (as colonial Zimbabwe was called). Nonetheless, a constantly oscillating migrant labour force had its downsides as the urban economies matured since it restricted the availability of skilled labour. Thus, a limited number of family houses – for rent and not ownership – were built in ‘townships’ such as Highfields to allow an element of more skilled and permanent urban labour to emerge. At independence, the ownership of most of these small, one-storey houses was transferred to their main tenants. The history of the way in which this housing was costed to its main residents both before and after independence bore no relation to the forces of supply and demand; as such, it is discussed in Chapter 5 as an example of mass public housing provision. Chitungwiza and Kuwadzana were very different, both being site-and-service settlements where people were allocated land (called plots or sites in African housing parlance) and were then supposed to construct their own dwellings. These could then be connected to the water and electricity supply provided in the settlements; these supplies were metered, and households defaulting on their bills could be disconnected. Chitungwiza was begun by the white state in the late 1970s, just before independence in 1980. Kuwadzana (meaning ‘cooperation’) was begun shortly after independence with support from USAID. All the homeowners in these areas at this point had been significantly subsidised 22

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by the government or by aid programmes. Profit-oriented market forces had had little to do with their housing. However, most interviewees in the survey were lodgers renting rooms from these homeowners. Their rents were set by market forces operating across the city and were completely unregulated, even though rent control legislation was on the books. The rents for one or two rooms were generally very similar, with some variation between settlements according to distance from the main employment areas of downtown Harare and its industrial zone. Many migrants were young, unmarried and lived alone in one room or shared with a friend. Married migrants usually lived with most of their immediate family in town for at least part of the year, in contrast to the situation before independence, but there was a significant proportion whose spouse and/or children were still living in the rural areas. Most of those divided from their families in this way aspired to bring their families to town and live together, but, as they often pointed out, the problem was money. They could not afford to support them in town, largely because their outlay on housing would increase or they would all have to live in one room together. This pattern of an entire household living in one room is common enough in the rental sector in African cities, but it is obviously neither desired nor desirable, being a response to the housing dilemma at the centre of this book. When asked about their plans and aspirations for the future, it turned out (rather unexpectedly) that most of the migrants expected to leave the city eventually and return to rural areas, usually their birthplace, in a pattern similar to that previously enforced by racist legislation. There was no social security net in place and few had any expectations of a realistic pension. As they explained, what would they eat and how would they pay their rent if they became unemployed for any length of time or had to stop work due to old age or ill health? Staying in the city permanently, they argued, was possible only ‘for those with a house and a pension’. The survey’s main aims had not included the issue of housing per se, but the key components of household budgets did emerge. And housing came up again and again during interviews, particularly in relation to family life and the risks of proletarianised life: 23

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unemployment, old age, illness. For this reason, during a subsequent survey in 1988, the residential area chosen was Glen Norah C: a new site-and-service settlement with access to water and electricity. Here, private-sector building societies had been brought in and incentivised via some new tax arrangements to provide loans to so-called ‘beneficiaries’ (homeowners). The shift from generous subsidisation of housing costs had begun, in line with trends across the world as the neoliberal phase of contemporary capitalism took hold. Precisely the same forces were at work in nearby Zambia and Malawi, for example. They were also in full swing in London. In the hope of maintaining a reasonable rate of repayment from the new borrowers in Glen Norah C, a minimum income was set as a condition of eligibility for the scheme, as well as a maximum. This was in contrast to the situation in Kuwadzana in 1985, at which time only a maximum income was set, above which people were ineligible for the scheme. Kuwadzana was thus much more definitely a pro-poor housing scheme, although Glen Norah C was also promoted as such by the government and the World Bank. Applying a minimum income condition at Glen Norah C showed that it was realised that the poorest Harare households could not afford to service a loan for a basic site-and-service plot, let alone build anything on it. In other words, it was proof of the premise of this book: that it is impossible for the formal private sector to provide housing for the poorest urban groups. It is also proof that the World Bank knew this. The loans available at Glen Norah C presumed that most of Zimbabwe’s urban workers would not be able to pay more than 30% of their monthly income to pay back the building society over 20 years. This guideline of a 30% level of income as a maximum for housing costs for low-income households is quite common in such calculations across the world, although nowadays many renters and homeowners in the largest cities of the GN are paying much more. However, where incomes are very low in real terms, as in most of Africa, it is understood that the opportunity cost of paying another 10% or 20% or more of your income for housing does not mean setting aside meals in restaurants or new clothes, but cutting out some food altogether, taking children out of school, or leaving the purchase of medicines so late that a sick family member will suffer 24

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unnecessarily or even die. In other words, when people are really poor, the welfare losses imposed by increasing payments for housing can be very serious and potentially life-threatening. It is worth noting that, unlike a mortgage for an already constructed house, the sort of housing loan made in Glen Norah (and in thousands of similar projects across the urban GS) did not provide any actual housing in the first instance – just access to a bare plot. Until something is built, the borrower has nowhere to live (or they must rent somewhere else, compounding the affordability issue). For those on the minimum income level applied at Glen Norah C, the maximum loan they could get covered the cost of the plot but not much else. In other words, there was no provision for the cost of building most of the actual house but they would already be paying out 30% of their income to service their loan. This is something of a dilemma, evidently. But what housing loan could typical residents living in Glen Norah C actually afford? The 1988 survey collected data on household incomes and it turned out that the average income of the 227 migrants interviewed was almost identical to the average for beneficiaries of the programme. In other words, they were good proxies for the households living in the area. Many of Harare’s low-income households are from other parts of Zimbabwe and, in the 1980s, most worked in the formal sector, as did the rest of the city’s workers. Unemployment levels were low. The survey data were used to construct housing affordability curves (see Figure 2.1), which showed how many could afford the housing payments needed to actually build a house, even if gradually. Not many, it turned out. Based on the household head’s income, only 8% could afford the monthly payment of Z$141.20 that was necessary to repay the size of loan required both to buy and occupy their plot and then to build the minimum type of house required by local regulations. The average loan provided by the building society was thus completely insufficient to build the required house. This was also obviously problematic. Yet half the migrants were even too poor to borrow that amount. A third had incomes below the minimum required for the scheme. The affordability curve based on total household income, including income earned by other household members, 25

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Monthly income Z$

Income required to build minimum house

141.20

400 Average HHH income in Glen Norah C

77.94

200

Monthly payments (30% of income) Z$

600+

0 0

20

40

60

80

100

% respondent households Glen Norah household head income, 1988 Glen Norah total household income, 1988 Household head income in all surveyed low-income housing areas, 1985

Figure 2.1  Housing affordability curves for households in a private-sectorfinanced scheme in Harare

was slightly more favourable, with about 19% able to build the minimum house. This would still have left four-fifths unable to build a house – and anyway, in practice, loans were based solely on the household head’s income.5 In some ways, the scheme was smoke and mirrors. It was officially meant to be addressing the city’s critical housing shortage for those on lower incomes. However, the ideological turn towards cost recovery and the involvement of private-sector profit-oriented housing finance meant that the costs – which, it must be remembered, were on a site-and-service basis with no actual house at the start and no allowance for labour costs – were far too high for the vast majority of the groups for which it was intended (which, in this case, was most of Harare’s population, excluding the remaining white residents). 26

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The construction of affordability curves for housing is sobering. The concepts were used in South Africa to provide insights into the constraints on future housing policy in the run-up to the final attainment of democracy in 1994. As is often the case for a new political force that has long struggled against the problems it is now faced with solving, and where class and financial interests in maintaining the status quo are not so entrenched, there was a moment of clarity and relative openness in policy circles. A government White Paper on housing published in 1994 was clear: although there were various constraints, ‘all of them are dwarfed by the single most significant constraint to the housing delivery process, that of affordability’. There were two sides to this issue: one was the need to recognise ‘limitations imposed by the State fiscus and macro-economic realities’. However, ‘of more significance and concern is the grinding poverty of such a large proportion of the South African population. This provides the single most important limitation on the housing programme. The resolution of this problem is something that a sustainable housing programme can significantly contribute to, but cannot remotely seek to solve on its own.’6 The White Paper contained various summary data illustrating the affordability problem. The total monthly income of 40% of all households was estimated to be under R800 and 70% had less than R1,500. But it was found that there was ‘almost insignificant’ provision of formal-sector loans for housing to any household with less than R3,500 per month. A housing dilemma indeed if it were hoped that the formal private sector would play a role in solving the housing crisis – since a mere 14% of households earned more than that. Even if some families with less could borrow something, albeit not enough for a completed house, as in the Zimbabwean example of Glen Norah C, it was estimated that 45% to 55% of South African households were simply not going to be able to borrow any housing finance at all, or afford to pay it back if they did. This group was going to be entirely dependent on its ‘own (limited) resources and State subsidisation’.7 The new South African government tried very hard to encourage and cajole local building societies and banks to become seriously involved in low-income housing and appointed one of the African 27

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National Congress’s (ANC’s) most senior members, Joe Slovo, to the Housing Ministry. But they refused to lend to households with less than R1,500 per month,8 thereby excluding 70% of families. The South African situation was a microcosm of the urban housing dilemma across the world – of the circle that cannot be squared by talking up either the need for more urban land or the efficiencies to be derived from profit-oriented private-sector housing delivery. In different countries and cities the figures will play out differently, and they also change over time (currently usually in directions that make the situation worse), but there is always a segment of the housing ‘market’ which is too poor to be reliably profitable for private-sector finance. The South African White Paper had put this problem up front, for once. Caught between a radicalised urban population with high expectations for housing, and the gimlet eyes of the International Monetary Fund (IMF), World Bank and international credit-rating agencies assessing their public finances, the ANC opted for a compromise. In a radical departure from other African countries, it introduced a one-off means-tested cash housing grant payable to any household earning under R3,500 per month. This could be used in various ways but its primary purpose, according to the White Paper, was to provide ‘security of tenure and access to basic services as well as possibly a rudimentary starter formal structure to the poorest of the poor’. The top grant was R15,000 for the poorest households on less than R800 per month, decreasing to R5,000 for those with R2,501–3,500, and it was to be increased in line with inflation. The South African approach has been evaluated and analysed endlessly since then. There have been well-founded criticisms relating to, for example, the location of most housing schemes in areas too distant from areas with jobs – although unless land costs are subsidised in some way this is a depressing inevitability for ‘low-cost’ housing projects for low-income people in a freemarket urban environment anywhere in the world. Housing quality and size are seen as problems. Many schemes received higher levels of subsidy than the limits theoretically set or they would never have been completed. There is still a significant housing shortage and many still live in unplanned settlements and/or are squatters. 28

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The idea of ‘incrementalism’ embedded in site-and-service appro­ aches, whereby the poor provide ‘sweat equity’ on a bare plot, as in the Zimbabwean examples, often proved too contentious. At first, it had been highly unpopular in Zimbabwe too. By 2014, 20 years after the attainment of democratic rule, any couple living together or household head with dependants with a total household income under R3,500 per month could apply to go on the waiting list for what had become known as RDP houses. These were named after the short-lived Reconstruction and Development Programme; this guided South African policy from 1994 but was replaced in 1996 by a much more market-oriented approach, to the dismay of pro-poor activists. When they reached the top of the list, a small, basic but serviced and legal house was assigned to them for free (i.e. their housing grant had been put towards it and they were now ineligible for a further grant). They could not sell this house for at least eight years. The concept of receiving a grant to put towards housing had been rolled up into straightforward but basic provision. There were 17 other subsidy programmes operating for different income groups by 2014, but the RDP projects were much the largest.9 However, accepting at the start that typical incomes meant that market-based solutions were not going to work for the majority was crucial. Despite many problems, between 1994 and 2014 the government built 2.84 million RDP houses and provided 903,000 serviced sites10 and had much improved the lives of the beneficiaries (see Box 2.1).

Box 2.1 The benefits of RDP houses in South Africa Research in Durban and Johannesburg has found that ‘[r]esidents living in RDP housing, particularly those who had moved from informal housing, were near-unanimous in their joy over the improvement in their everyday quality of life. These benefits related in particular to protection from (continued) 29

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(continued) the elements (specifically rain), security of tenure, and access to water, sanitation and energy.’ Florence in Johannesburg told researchers how her RDP house ‘means everything … Yes. Because now … when it’s raining, I’m sleeping comfortably. It’s not like when I was in the shack, you know when it’s raining … I have to move the things that side or what, what. It means everything.’ According to her son, ‘The day we opened this house, she even cried to see how happy she is.’ Early RDP houses were often very small and did not give much extra space over previous informal shelters but newer ones were better. Siyanda in Durban explained, ‘I’m so happy to own the house as I’m living with my children only … the children have their own room to make noise. We have space for cooking and the children are able to study in their room. If I’m thinking back in the informal settlement … we were sleeping in one bed with girls and boys because we did not have the space.’ Source: Charlton, S. & P. Meth. 2017. Lived experiences of state housing in Johannesburg and Durban. Transformation: Critical Perspectives on Southern Africa, 93, 91–115.

Urban incomes and hard limits on housing expenditure The Zimbabwean and South African examples demonstrate the hard limits set by typical urban incomes on housing solutions if those solutions are bound by the norms of free-market pricing and financing. When these limits are recognised, the logical necessity of thinking about what determines incomes as the first building block of understanding housing issues becomes apparent. This is a complex topic but the essential element in relation to housing affordability is that urban people are caught between two sets of markets. Labour markets determine what people are paid and housing markets determine what housing costs. Crudely speaking, 30

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across the cities of world, the pay rates for millions of jobs or types of work are simply too low for the workers involved to pay enough for the types of housing that can be provided by private-sector markets that comply with regulations and have legal tenure. The existence of such hard limits for individual families set by their incomes and the requirement to meet certain basic needs in order to survive are fully understood by poverty analysts working in the GS when they are working on food security. Indeed, this is the starting point. Obviously people have to eat, and they should eat every day. Food costs money. It is fairly straightforward to calculate the cost of a basic food basket needed for adequate nutrition and compare this to incomes. Much of this sort of food security work is done in rural areas in the GS where most people are often poor or very poor. Most national poverty datasets show that the incidence of poverty is much lower in urban than in rural areas in GS countries. However, the way in which such data are analysed is problematic. First, fairly obviously, most rich people tend to live in cities and so do most of the ‘real’11 middle classes. The number of middle-class people in countries such as Brazil, India and China is now very significant. These skew the figures. However, if the typical livelihoods, real disposable incomes after all necessary urban living costs, and lifestyles of most people living in urban low-income settlements are compared with those in rural areas, the seemingly large gap in ‘poverty’ narrows. Indeed, the underestimation of urban poverty levels in the GS is a key data problem for really understanding cities in these regions.12 As anyone who has worked on livelihoods in urban Africa will attest, there are very many households living day to day and hand to mouth, who spend most of their money on food. When things are tough, meals are missed. As already described above, this is a situation in which an extra few per cent of income spent on rent will cause real reductions in household welfare. This is poverty. As will be discussed in Chapter 4, if you cannot significantly increase your income in such a situation, then you may have to house yourself informally because that means your housing expenditure plummets. This ‘magically’ increases your disposable income and, depending on the local politics of urban poverty datum line setting, may make you apparently non-poor. 31

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But suppose that urban poverty datum lines were set differently and in accordance with the frequently asserted view that capitalist property norms, functioning urban land markets and ‘legal tenure’ are essential to the functioning of efficient, productive cities. Let us say that the basic urban household income required for people to be classified as ‘non-poor’ in any city across the world must include an allowance for, say, current market rents for the cheapest types of housing but in a legal, planned dwelling with secure tenure and legal connections to water and electricity. (Let it be remembered that current definitions used by UN-Habitat label any other type of urban housing as ‘slums’.) In essence, this is the situation in most of the GN. The immediate political argument that ensues is over space – how many rooms per person in the household are being factored in. Yet, however that were worked out, the basic principle would reshape our understandings of the incidence of urban poverty, which would shoot up in most of the cities of the GS. The corollary, of course, is that poverty rates in the GN would, apparently but absurdly, decrease were ‘cheap’ illegal slums to reappear at scale in the world’s wealthiest cities, and if their inadequacy were not factored in to poverty measurement. This approach has been used for years by the Jesuit Centre for Theological Reflection (JCTR), an organisation that, among other things, monitors prices and household budgets across the city of Lusaka in Zambia. At first they published food budgets based on the food needed for a family of six to keep them healthy. The diet is entirely in accordance with local norms, with mealie meal (maize) being by far the largest item. In 2002, the JCTR updated its budgets with the necessary other costs incurred in town, of which rent is by far the most significant. Information on the ‘basic needs’ basket is regularly used by trade unions and other groups when lobbying for wage increases. In the first quarter of 2002, the basic food basket cost 324,510 Zambian kwacha per month. The monthly ‘take-home pay’ of a selection of formal-sector workers could not cover this cost. For example, the lowest-paid secretaries, nurses and police officers at the time earned between K120,000 and K270,000. Even those at the top of their scales earned only K300,000 to K370,000. Primary school teachers could earn between K280,000 and K309,000, so 32

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even they could not afford the basic urban food basket. But this was only the start of the problem, because once other basic urban costs, including housing, were added, the costs rose to K823,510. Even secondary school teachers at the top of their scale earned only 60% of this amount. While this was startling enough, these budget figures relate only to those in the urban formal sector. The great majority of the urban population works in the informal sector where incomes are generally even lower, so the situation was actually much worse. The lowest-paid security guards recorded by the JCTR – on K40,000 per month in 2002 – were better surrogates for many in this sector.13 Surveys in markets in 2004, when the basic needs basket costs had increased by a further 25%, found that in Lusaka’s largest market, Soweto, 64% of customers were earning under K100,000 per month. If the small amount of meat, eggs and dry fish were removed from the 2002 budget, it went down to K278,110 – still far beyond the means of most and leaving a diet seriously deficient in protein. These depictions of poverty in the city are completely rejected by the government, however, which produces its own figures that show far less urban poverty. Yet a key reason for this is that the housing element of the government’s urban household budget is based on costs in informal settlements. The JCTR, on the other hand, used the costs of renting modest accommodation in formal, legal, ‘decent’ housing. This was because, while it was true that the government’s approach was using more typical housing costs, these were characterised by conditions that any multifaceted approach to understanding poverty would factor in to the measurement of who is poor and who is not. Such multifaceted approaches are strongly promoted by all poverty experts and agencies across the world. And the Zambian government is not above knocking down the occasional informal settlement because it is ‘illegal’.14 In other words, the JCTR’s approach was that being unable to afford anything except very inadequate and insecure housing is incommensurate with being ‘not poor’. In cities across the GS, the truth of hard limits on housing expenditure can be seen in other ways. In Harare, the average rent for one room in Kuwadzana, the city’s largest low-income housing project, remained at around 10% of the average income of a 33

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formal-sector wage worker in both 1994 and 2001. Rents were seen as burdensome and people complained about them rising but in real terms the share of income spent on rent was not changing much. The proportion spent on food did rise after structural adjustment started in the 1990s. But despite a shortage of housing, rents only kept pace with incomes – there was a cap effect on rents set by what people could afford. A similar situation was found by the urban development specialist Philip Amis in Nairobi in the 1990s,15 and there is evidence of this effect operating in the low-income rental sector in Buenos Aires and in Mexican cities, according to Professor Alan Gilbert of the Geography Department of University College London, who has long championed the importance of the rental sector in the cities of the GS.16 As Gilbert says, ‘however grasping landlords may be, poor people can only be exploited to a certain point’.17 But so what, it might be asked? The examples so far come from the GS and we all know that countries there are poorer than the societies of the GN. So perhaps it is to be expected that many urban residents there will not be able to afford ‘decent’ housing and are too poor to be a viable market opportunity for formal housing finance and developers. Surely this is a problem of developing countries (or emerging markets, as they are now sometimes called)? But it is not. This is a global urban problem, from the UK to the USA, not just in African, Asian and Latin American societies. Let us look at the situation in England shortly after the global financial crisis. In 2011, research in England using Valuation Office Agency private rental market statistics showed that the median rent for a two-bedroom home was more than 35% of local median take-home pay for fulltime employees in 55% of local authority areas. Let us recall that a level of about 30% of income on rent is often used in housing studies as an affordable maximum. In other words, private-sector rental accommodation in most of England was unaffordable for any family, even if they had only one child, if only one income was being earned and that income fell in the lower half of the income range. Any family on such an income with two children who needed three bedrooms would be unable to pay the much higher rent necessary.

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In Haringey, in north-east London, which has many working-class families and is very ethnically diverse, a three-bed home in that year would have taken up 75% of median income. This is completely unaffordable – food intake and necessary expenditure on items such as clothes, utility bills and transport would have to be sacrificed. In other words, precisely the sorts of issues that are central to investigations and analyses of urban poverty in the GS would become evident. The centrality of the issue of norms about space and privacy in housing also become clear; this will be returned to in Chapter 3. The housing affordability problem is much worse in the southeast of England because higher pay levels are far outweighed by higher rents. Median monthly rent for a two-bedroom home in London in 2010–11 was £1,360, equivalent to 60% of the median take-home pay; in Oxford it was 55%. Even in some poorer towns the problem was worse than the average because local pay was so low: in Blackpool 42%, of take-home pay was needed. Private-sector rents in London were already rising much faster than incomes by 2011: in outer London they rose three times faster in that year. Over a quarter of London’s population were renting from private landlords in 2013, up from 14% in 1991, so the problem was affecting more and more households. Perhaps it might be thought that the problem was mainly confined to households where there was only one worker who had low educational qualifications and was unskilled. But in the aftermath of the global financial crisis of 2008, incomes fell in real terms for most people, including key workers with professional qualifications: for example, they fell in 2011 by 1% for nurses and teachers. Being skilled and having two workers was not proof against the housing affordability dilemma in London. Using the 35% of net income cut-off, a net household income of over £40,000 (equivalent to £50,400 in gross wages) was necessary to rent a two-bed home in half of London’s 32 boroughs in 2011. This would have been unaffordable for a two-earner family consisting of a full-time prison officer and a part-time teacher. The impossibility of affording private-sector housing for the millions in the UK on much less than median incomes was obvious from these data. In 2011 there were 6 million people who earned

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within a pound of the minimum wage (£6.19 per hour in UK for adults at the time). Full-time workers on the minimum wage had annual net earnings of £10,740 (£825 per month). Even if it all went on housing, it would not have covered the median rent in 28 out of 32 London boroughs or in nearly a fifth of England’s local authorities. Even for a family with two full-time workers on minimum wages, in those localities the median rent for a two-bed home would have taken up over half of their budget. Five years later, the housing dilemma had worsened. Figure 2.2 illustrates the situation, showing the proportion of net income required to pay for different types of rental housing in England overall, or in London, in 2016. The graph uses UK Office for National Statistics (ONS) data on housing affordability across England and median net monthly pay combined with calculations Mean 2-bed flat London £1,685

1,600

1,400

Mean 1-bed flat London £1,329

1,200

B

Rent £

1,000

Mean 2-bed flat £760

800

Mean 1-bed flat £694

600

Mean room in house London £607

A

400 Mean room in house £382

200

150%

140%

130%

120%

110%

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

0

% of income on rent Rent share of median wage

Rent share of minimum wage

Figure 2.2  Typical wages and average rents in England and London in 2016: the housing dilemma illustrated

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for net monthly pay for full-time workers on the minimum wage. The ONS uses the normal 30% of net pay on housing as the affordability level and calculates the ‘gap’ between that and market rents. This gives a monthly rent of £550 for those at the mid-point (median) of wage distribution (point A on the graph). For a twobed rented home – the minimum ‘decent’ standard for a family with one child (or two of the same sex) and the largest type of accommodation for which data were provided – the average UK rent was £760, so the gap was £210. Evidently the problem is far greater for those lower down the income scales: for every percentage point on the income distribution scale they fall below the median, the larger the gap. For full-time workers on or near minimum pay rates, the gap is huge at about £410, nearly double that for those on median pay. They would have to pay two-thirds of their net pay in rent (point B).18 Even some better-paid workers above the median pay rate would also find housing unaffordable. The scale of the housing crisis and the contemporary housing dilemma in the UK is thus exemplified – by far the majority of working people are affected. Yet even this underplays the problem because the housing dilemma under examination in this book is mainly about the issue in large cities where rents may be above the average. In Manchester, the gap for a worker on median pay was about the UK average at £221.23. However, in London the average rent for a two-bed flat was £1,658, which exceeded the total net income of a worker on the so-called National Living Wage in 2017 by about 50%. Even for those on median pay, the ‘gap’ between this and an affordable rent was £1,057. And while, for obvious reasons, the unaffordability of private rental housing is most acute in the centre of the city, the general problem exists across it: average rents exceeded total minimum monthly net pay in 30 of London’s 33 local government areas (32 boroughs plus the City of London). In 16 boroughs the same was true for average rents for a one-bed flat, and in the remaining boroughs a worker on minimum pay would have to pay upwards of about 80% of their net income. Average rent for one room in a shared house was £607 – 53% of the net minimum pay income – ranging from £813 in the most expensive area to £460 in

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the cheapest. Of course, a one-bed flat, let alone one room, is below ‘decent’ standards for a family with children. There is an additional housing cost that needs to be factored in to these equations in some parts of the world. Although there are obvious exceptions, particularly for cities at high altitudes, very generally speaking the societies of the GN are colder than those of the GS. This does mean that the issue of keeping houses warm becomes more crucial – it is another facet of poverty. In the UK, the housing affordability issue is compounded when energy bills are factored in. These averaged £1,356 per year per UK household in 2012. Research using average rents and energy costs in England in 2012 found that these totalled £10,248 per year. A minimumwage worker would be unlikely to live in the average home, but, if they did, it was calculated that for that year their ‘disposable’ income to cover necessities such as food, clothes, transport and council tax would have been less than £1.50 per day. That would have been impossible.19 Similarly impossible situations face low-paid workers in the USA. The National Low Income Housing Coalition there found that, in 2017, ‘there is not a single county or metropolitan area in which a [full-time] minimum-wage worker can afford a modest two-bedroom home, which the federal government defines as paying less than 30% of a household’s income for rent and utilities. And in only 12 counties [mainly rural ones in the West] in the country is a modest one-bedroom home affordable.’20 Because data on incomes and housing costs in rich countries are often better and more available, it is actually easier to demonstrate the housing affordability dilemma there. Nonetheless, playing the devil’s advocate, let us think about the arguments that might be put forward against the analysis of the UK or US in the paragraphs above. It might be said that costing in extra bedrooms for families with children is too generous: why cannot everyone sleep in the same room or, less drastically, why cannot children, or even adolescents of the same sex, share a bedroom? Or why is there any discussion about the mismatch between incomes and rents for a one-worker multi-person household, or a family with a full-time and a part-time

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worker? If families want shelter, everyone must work full-time. Or perhaps people should not have families if they cannot afford to house them ‘properly’ and such people should remain ‘single’,21 living endlessly in cheap, shared lodgings. Well, that is precisely what happens in the GS. Whole families often do have to sleep in one room, no matter the mix of generations and sexes. And often everyone in the family – often including children and old people – does have to go out to work, no matter how exploitative or dangerous the conditions, and bring back cash at the end of the day or the week. Furthermore, these sorts of conditions were typical of the cities of the GN in the nineteenth century. But these were and are the conditions of poverty, and for a few lucky generations in the GN national wealth and public policy combined to determine that these conditions were unacceptable. In the absence of proper sanitation, the outcomes of such conditions can be epidemics, which have had a very definite impact on housing policies. But beyond the public health situation, decisions have been made in the past about what standards of housing are commensurate with the desired norms of a wealthy and safe society in which it is possible to live as a family. These points bring up two key issues explored later in this book. The first is the role of policies on housing standards: both the type of house that can be built and expectations regarding a safe and healthy living environment for residents. This is the topic of the next chapter. The second is that the housing situation deemed acceptable for children is a very important influence on the outcomes of such policies. Children cost money, take up space and affect the kind of work, if any, that their primary carer can do. All these things in turn affect how the housing dilemma works out for different types of households. It is important to note that none of the arguments made above deny that the supply of housing provided by the market is important. For those able to afford such housing a shortage will increase prices or rents, meaning that some will have to buy less housing than they otherwise might have bought. However, from the perspectives of those in the housing dilemma – the focus of this book – as they were already unable to afford such housing, what

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difference does it make? For those in the income decile closest to affording some type of decent housing, however, it does make their aspirations less realisable. For those in the decile just above, they may be driven down into the housing dilemma. As housing activists point out, cities frequently have empty housing and some live in houses with far more bedrooms than their household needs while many are unable to afford adequate accommodation or are homeless. Danny Dorling, Professor of Geography at the University of Oxford, in his book on the housing crisis in the UK, All That Is Solid: the great housing disaster,22 suggests that one solution would be somehow to reallocate excess accommodation to those in need. In theory, this could help; in practice, contemporary political realities make it impossible. Vigorous policies to reduce speculation on housing and land would help remove an egregious source of supply limitation. However, even politicians can be implicated in this.23 In sum, for most in the housing dilemma, only non-market or informal market solutions are likely to help. It would be possible to outline the parameters of the sorts of housing dilemma detailed above for Zimbabwe, South Africa and the UK for most urban societies across the world.24 Yet so far the examples given here have been mainly about the rental sector. In nearly all cases the dilemma is greatly magnified for house purchasing, where costs tend to be much higher. In all countries and in both the rental and homeownership sectors, the essential element is the mismatch between earnings (the labour market) and rents or mortgage payments (the housing market). In most cases, the households unable to meet the housing payments include working adults.25 In other words, the problem is not one of unemployment, although that makes it worse, but pay levels that are incommensurate with the ‘requirements’ of contemporary, formal housing markets. These markets are influenced by the usual economic factors of supply and demand; they set the cost of housing. Additionally, as market forces determine the wages and incomes of urban workers, they in turn influence the pensions that older citizens might command (see Chapter 5), although in many poorer countries in the world pensions are non-existent for most and utterly inadequate in relation

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to urban living costs for many lucky enough to receive them. And those market forces, in almost every city across the world, not just in the GS, determine that some proportion – often a very significant proportion – of the city’s workforce and its older citizens are not paid enough to ‘demand’ the housing that the city’s formal housing market can supply. In other words, there is an inevitable and serious mismatch that is an outcome of the ‘invisible hand’ of market forces in the late twentieth and current twenty-first century. This is true whether you are in London or Lagos, Hong Kong or Rio de Janeiro, Los Angeles or Shenzhen.

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Chapter 3

Affordable urban housing and the role of basic standards

Housing standards: the necessity of a double-edged sword In 1910, infant mortality rates in the slum area of Cowgate in Edinburgh were 277 per thousand,1 far higher than anywhere in the contemporary world (the highest current rate estimated is 82 for the Central African Republic).2 This shocking statistic needs to be kept in mind when considering the complexities of the relationships between housing standards and affordable housing. There is no denying that regulations that enforce decent standards do increase housing costs. Therefore, ceteris paribus, they make housing more unaffordable for the poor. For those opposed to the impacts of government regulation on free markets, it is all too easy to conclude that the ‘way in which quality enhancements can make those with low incomes worse off is perhaps most vivid when minimum standards price the poorest households out of the market and increase the number of households that are homeless’.3 This sort of analysis is simplistic. It is also literally dangerous. Acknowledging that housing standards are a double-edged sword for the poor is reasonable. However, there is no doubt that

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they are necessary – the experience of early industrial urban Europe and North America is proof enough of that. Regulations about other necessities for human life, such as the quality of water or food, are generally accepted as requirements in the contemporary world – few economists dare to argue that poor children should be ‘allowed’ to drink dirty water since it is cheaper. Yet the impact of poor housing on death and serious illness rates in Global North (GN) cities in the not-so-distant past is forgotten by many today. It needs to be remembered, which is why this chapter begins with a brief review of those conditions. Since obviously inadequate urban housing is now mostly, although far from only, found in the cities of the Global South (GS), there is a tendency in housing studies to assume this type of housing is not relevant to understanding low-income housing issues in the GN. This is a mistake. If we confine ourselves to the capitalist era, up until the early to mid-twentieth century, there were many residential areas in European and North American cities with shocking housing conditions. Private-sector landlords provided the sort of rooms for rent that the poor could afford – so, in that sense, the market worked. However, this meant that the rooms were often dangerously inadequate for the maintenance of health and family life and households mostly lived in one or two rooms, just as they do in so many low-income settlements in the GS. In many cities across Europe and North America, the outcomes of these housing conditions, which followed on from their occupants’ poverty and lack of monetary demand for anything better, were appalling. In the contemporary age they would be regarded as catastrophic. Morbidity and mortality rates were phenomenally high, way above those typical of low-income settlements in the cities of the GS today. In the early stages of the Industrial Revolution, because urban deaths exceeded births, the pace of urbanisation in the GN would have been glacially slow, or negative, had there not been such a steady supply of in-migrants from rural areas (driven out by enclosures of their land and other

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agricultural changes). Without the opportunities for emigration to North America and the colonies, the demography of the Industrial Revolution’s ‘urban penalty’ in Europe would have been much worse. Life expectancies were higher in rural than in urban areas – in antithesis to the usual patterns in the GS since urbanisation began to pick up pace there.4 Certainly not all these circumstances were due to poor housing alone. The conditions of poverty tend to combine in deadly ways: people who cannot afford decent housing may also have poor nutrition because they cannot afford proper food. More importantly, the engineering solutions (and the required public investment) to the deadly water and sanitation conditions in low-income housing areas in Europe’s and America’s industrialising cities did not emerge until towards the end of the nineteenth century. Mass vaccination against childhood diseases and antibiotics came much later, in the twentieth century, but they were in time to make a difference to health in the cities of the GS and help explain their relatively positive demographic outcomes during the twentieth century compared with those of the GN in the nineteenth century.

Box 3.1  Dickens’ slums Jo lives – that is to say, Jo has not yet died – in a ruinous place known to the like of him by the name of Tom-all-Alone’s. It is a black, dilapidated street, avoided by all decent people, where the crazy houses were seized upon, when their decay was far advanced, by some bold vagrants who after establishing their own possession took to letting them out in lodgings. Now, these tumbling tenements contain, by night, a swarm of misery … that crawls in and out of gaps in walls and boards; and coils itself to sleep, in maggot numbers, where the rain drips in; and comes and goes, fetching and carrying fever … Twice lately there has been a crash and a cloud of dust, like the springing of a mine, in Tom-all-Alone’s; and each time a 44

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house has fallen. These accidents have made a paragraph in the newspapers and have filled a bed or two in the nearest hospital. The gaps remain, and there are not unpopular lodgings among the rubbish. ∗∗∗ Wretched houses with broken windows patched with rags and paper: every room let out to a different family, and in many instances to two or even three – fruit and ‘sweet-stuff’ manufacturers in the cellars, barbers and red-herring vendors in the front parlours, cobblers in the back; a bird-fancier in the first floor, three families on the second, starvation in the attics … a ‘musician’ in the front kitchen, and a charwoman and five hungry children in the back one – filth everywhere – a gutter before the houses and a drain behind – clothes drying and slops emptying from the windows … Sources: Charles Dickens, Bleak House, 1852–53; Sketches by Boz, 1836.5

The conditions in which the majority of the urban population in the GN were housed contributed significantly to their poor welfare. They were described in the literature of the time: for the UK that of the revolutionary left (e.g. Engels’ classic study The Condition of the Working Class in England),6 of academics (e.g. Charles Booth’s classic mapping of poverty in London in the nineteenth century),7 and in fiction. Dickens’ novels about London are full of descriptions of poor people living in overcrowded, unhealthy rooms, of the fear and reality of evictions because of being unable to pay the rent, and frequent deaths as a result (see Box 3.1). Indeed, this was deliberate, as he partly wished to shock society into recognising how unacceptable these situations were. In Edinburgh in 1862 it was common for households to share one room: one survey found 1,530 rooms with occupancy rates of 6–15 people per room.8 Due to Edinburgh’s topography, there were some multi-storey tenements with essentially subterranean conditions in which families were sharing 45

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rooms without any natural light. Rickets were common. The shocking conditions could be found across Europe. In Moscow and St Petersburg, for example, workers often lived in bunks in factory dormitories, and one estimate for 1900 suggested that about one in six Muscovites were renting corners of rooms rented to others.9 In 1912, on average there were eight people living in each apartment in these two cities.10 A central feature of Frank McCourt’s bestselling autobiography Angela’s Ashes is his description of the series of cold, damp, pest-ridden rented rooms that were all his family could afford in New York and Limerick in the 1930s and 1940s, and, worst of all, the associated deaths of three of his siblings as well as his own near fatal typhoid and his mother’s pneumonia. At one point, assessors deciding whether the family deserved charity admitted that their housing conditions were similar to the slums of Calcutta (see Box 3.2).11 Policies to address such conditions in GN cities emerged rather slowly but eventually appeared to have consigned tragic outcomes such as these to the past (see Chapters 6 and 7). Cowgate’s infant mortality rates were exceptionally shocking in the nineteenth century but they were high in Edinburgh as whole, at around 130. They fell only slowly to about 115 in 1915 and then steeply to 20 in 1950; today they are around five deaths per thousand.12

Box 3.2 Desperate slums in Limerick, Ireland in the 1930s Mam tells us there was a terrible flood, that the rain came down the lane and poured in under our door … People emptying their buckets made it worse and there was a sickening stink in the kitchen. She thinks we should stay upstairs as long as there is rain … One night there is a knock on the door and Mam sends me down to see who it is. There are two men from the St. Vincent de Paul [Catholic charity] and they want to see my mother and father. I tell them my parents are … [u]pstairs where ‘tis dry …

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They want to know what that little shed is beside our front door. I tell them it’s the lavatory. They want to know why it isn’t in the back of the house and I tell them it’s the lavatory for the whole lane and it’s a good thing it’s not in the back of our house or we’d have people traipsing through our kitchen with buckets that would make you sick. They say, Are you sure there’s one lavatory for the whole lane? I am … They tell Mam and Dad … the Society has to be sure they’re helping deserving cases … They want to know why we’re living upstairs. They want to know about the lavatory … Dad tells them the lavatory could kill us with every class of disease, that the kitchen floods in the winter and we have to move upstairs to stay dry … I have to go downstairs again and show the men where to step to keep their feet dry. They keep shaking their heads and saying, God Almighty and Mother of God, this is desperate … upstairs, that’s Calcutta. Source: McCourt, F. 1997. Angela’s Ashes. London: Flamingo, pp. 113–14.

Students from countries in the GS doing urban studies in Britain are sometimes astonished to learn that the housing problems with which they are familiar from their own societies were so common across the urban GN, and that, as demonstrated by Angela’s Ashes, these were sometimes still occurring within living memory. This is usually because, in tune with so much of the housing literature, they have been taught to think that the urban housing problems of the GS are separate, with different underlying causes, from those of the GN. When they recognise that the starting point is that people can only be housed in the sorts of accommodation that they can afford, no matter where you are, they swiftly realise the significance of the hard constraints of typical incomes for the lower-paid members of any society. Often they suggest that the difference must be that the 47

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state mediates the situation in the GN by enforcing proper standards. However, when it is pointed out that this inevitably means that the cost of the cheapest housing will rise, making it unaffordable for many residents for whom there is nowhere else to go, the true nature of the global housing dilemma at the heart of this book begins to become clear, as does the double-edged sword of standards in a market economy. The solution of tackling the gap between the market-determined prices of labour and decent housing through the state boosting low incomes with housing allowances or providing subsidised housing is the next logical step in the discussion. In real life, in most societies the situation is far messier than the logical conclusions of discussions such as these. Urban housing outcomes depend on the locally specific interaction between the incomes set by the labour market and housing costs set by housing-market conditions, overlaid by variable and only partial types of intervention to try to address the inevitable affordability dilemma. In this complex mix, housing standards are only one part of the subset of conditions influencing housing costs. Yet their importance for human welfare makes them central to an analysis of the housing dilemma. Their implications are not a simple binary: higher housing costs versus health and social welfare. Although, in general, striving for decent standards must be the right thing to do, there are ways of doing this that reduce possible negative side effects for the poor. Housing standards can be inappropriate or used punitively, and this has to be avoided. The following sections start with an example of GN housing standards legislation from the UK as a template for the crucial welfare issues these address and also to understand their limitations. An analysis of the pros and cons of building standards follows, using examples from The Gambia, Zimbabwe and Texas. Housing standards in the Global North: UK example

The types of housing standards implemented in the cities of the GN could be illustrated with reference to almost any country, from Australia to Austria, Italy to Ireland. Each would include elements of local idiosyncrasies but the key point is that they would demonstrate the complexity and breadth of the regulations found necessary 48

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to prevent market forces throwing up housing that is dangerous for its occupants (albeit possibly affordable). The example chosen here is the situation in the UK. There are two main sets of housing standards regulated in the UK: the types of new houses that can be built and the conditions within housing deemed acceptable for particular types of residents. Familiarity with the very different types of housing typical in lowincome settlements in the urban GS and those in the GN suggest at first that a key difference, because it is so visible, is the type of materials used, and that therefore the use of cheap building materials such as soil bricks and corrugated iron is forbidden in the GN. In the UK, this is not necessarily the case; instead, what is required is that all building work should use materials that are ‘adequate and proper’ for the purposes intended and that the work is done in a ‘workmanlike manner’.13 In theory, a soil brick house with a corrugated iron roof of the sort millions of people in African or Asian cities inhabit is possible. You can even build a house largely of straw bales.14 However, there is a host of regulations about what else is required for a house in which people are going to live. These cover structural safety, fire safety, resistance to contaminants and moisture, toxic substances, resistance to sound, ventilation, sanitation, hot water and water efficiency, drainage and waste disposal, heating and appliances, protection from falling, conservation of fuel and power, access to and use of buildings, glazing safety, and electrical safety. Also, most houses in large cities in the GN are more than one storey, even when they are occupied by only a single household, and frequently most residents live in multi-storey apartment blocks. Many building materials (such as unfired or even fired mud bricks) that are widely used in poor settlements in the GS are only adequate for one-storey houses as they cannot hold up a second floor. The load-bearing properties of building materials is thus a crucial issue. Resistance to moisture is another. Again, mud bricks can work if they are carefully plastered and the roof extends well beyond the walls to provide good protection from rain. Indeed, some of the large one-storey houses in the formerly ‘white’ segregated suburbs of Harare, Zimbabwe’s capital city, were constructed in this way in the early parts of the twentieth century, even though their current occupants may not know this. 49

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So, of course, are many cottages and old rural houses across Europe, even if their thatched roofs have been replaced. However, even the best-built mud-brick house in most low-income settlements in cities of the GS is unlikely to comply with all the other regulations listed above, including having hot water, bathrooms and toilets within the house and safe electricity, and being well insulated against heat and cold. The visible outside of the house, therefore, reveals only the beginning of the impact of housebuilding regulations. Current housebuilding regulations in the UK, or anywhere in the world, can, of course, affect only new housing stock. This is why in any long-established town across the world there is usually such a mixture of housing, and much privately owned old housing may not comply with regulations that did not exist when it was built. The incentive to maintain and update such housing largely derives from homeowners’ desire to live in reasonable comfort and safety and to maintain the value of their asset, although local authorities can enforce certain repairs if the condition of the house threatens others nearby. When such houses are sold, if the new owners have to borrow from housing finance institutions, the lenders will also insist that the house is (or is made) structurally sound, because they also have a vested interest in its value. However, standards for what are deemed acceptable living conditions for residents are laid out for existing rental housing in the UK. Tellingly, the relevant guidance is termed ‘A Decent Home’.15 Thus, two key terms that are central to the arguments in this book are up front. ‘Decent’ is explicitly a normative term: there is no possible objective definition and (in a housing context) it implies value judgements that are made about what a society collectively feels is right, what conditions within a house should be for the people living there, and what conditions are unacceptable because they cause too much physical and mental distress. The use of the word ‘decent’ in any legislation is extremely important because it implicitly recognises that ‘indecent’ conditions arise when market forces are unregulated.16 It is significant, for example, that debates about work and incomes across the world, led by the International Labour Organization (ILO), refer to ‘decent’ work or jobs. Again, the normative aspect is explicit: it is about work that is reliably paid, has 50

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safe and non-exploitative conditions and includes elements such as pension and health rights. The other word, ‘home’, is of equal significance because it is not the word ‘house’. It immediately signals that the issues are not seen as purely technical and that there is a recognition of the abstract and emotional aspects of dwelling in a specific building, of issues such as privacy, safety and the need for family life. The related UK Housing Health and Safety Rating System (HHSRS) states that its purpose is to regulate how ‘the dwelling as a whole, and each individual element in the dwelling has an effect’ on the ‘basic physical and mental needs for human life and comfort’.17 The Decent Homes guidance has four main elements. These are that the home must be in a reasonable state of repair: this includes external walls; the roof; windows and doors; chimneys; centralheating boilers; gas fires; storage heaters; plumbing; and electrics. It must also have facilities and services that are ‘reasonably modern’: these include a kitchen with adequate space and layout to contain all the required items (e.g. sink, cupboards, cooker, worktops); a main bathroom and an indoor toilet (with a nearby washbasin) that is not accessed through a bedroom; adequate insulation against external noise, if needed; and, in blocks of flats, adequate size and layout of common areas. Another requirement is for effective insulation and efficient heating so the home is warm enough to be reasonably comfortable. The most complex element of the guidance is that a decent home ‘meets the current statutory minimum standard for housing’. This is measured against 29 criteria in the HHSRS (Table 3.1) with a scoring system depending on the perceived likelihood of the hazard actually causing harm to the people in the home. High scores mean that the hazard must be remedied. The conditions that led to the appallingly high mortality and morbidity rates in urban housing in the GN in the not-so-distant past are all listed in this table. These are 1 and 2 (damp and mould growth, and cold); 11 (crowding and space); and 15, 17 and 18 (domestic hygiene, pests and refuse; personal hygiene, sanitation and drainage; and water supply). It is worth noting that hazard 11, relating to overcrowding, is understood to go beyond tangible physical criteria and includes other crucial aspects of a home (rather than a house), as it also accounts for ‘the psychological needs for both social interaction and privacy’ (emphasis in the original). 51

Table 3.1  England and Wales 2006 Housing Health and Safety Rating System (HHSRS): potential influences on ‘The basic physical and mental needs for human life and comfort’ A. Physiological hazards   1 Damp and mould growth   2 Excess cold   3 Excess heat   4 Asbestos and MMF   5 Biocides   6 Carbon monoxide and fuel combustion products   7 Lead   8 Radiation   9 Uncombusted fuel gas 10 Volatile organic compounds B. Physiological hazards 11 Crowding and space 12 Entry by intruders 13 Lighting 14 Noise C. Protection against infection 15 16 17 18

Domestic hygiene, pests and refuse Food safety Personal hygiene, sanitation and drainage Water supply

D. Protection against accidents 19 Falls associated with baths etc. 20 Falling on level surfaces etc. 21 Falling on stairs etc. 22 Falling between levels 23 Electrical hazards 24 Fire 25 Flames, hot surfaces etc. 26 Collision and entrapment 27 Explosions 28 Position and operability of amenities etc. 29 Structural collapse and falling elements

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There are further conditions about housing that relate to these issues about privacy and social interactions. There are ‘national bedroom standards’ that determine how many bedrooms a family should have. Separate bedrooms are theoretically required for a couple living together as partners, single adults aged over 21, and children of different sexes aged between 10 and 21. A bedroom can be shared by any two children of the same sex and from the same family, although a young adult who is not a family member needs a separate bedroom. If a woman is pregnant, it is understood that this will soon affect the number of bedrooms required.18 There are also standards about space requirements per person; these were set out in 1935 as a response to ‘overcrowded conditions in the private rented sector before the Second World War’, but they are very rarely enforced and data are rarely collected.19 These standards evidently have enormous implications for housing costs for families with children. Thus, it is these households, who are at the heart of any sustainable society and to whom politicians tend to refer constantly as a symbolic touchstone for the values and norms that they wish to represent, who in reality are seen as a costly strain on the urban system in Europe and North America. In the UK, as shown in Chapter 2, there are millions of urban families who do not earn anywhere near enough money to buy housing and who cannot afford to rent the decent housing that their societies, with all too recent histories of shocking rental housing conditions, rightly deem is required. Only government subsidies make their homes possible. It is hard to overemphasise the significance of this point for contemporary cities and their future prospects – it is possible that the future of the family in the world’s biggest cities is bound up with questions of housing affordability. This point is returned to in Chapter 9. As already noted, the housing standards encompassed by the UK’s ‘Decent Homes’ and HHSRS relate only to rental housing. Moreover, their enforcement is mainly focused within the social housing rental sector – that is, where non-market, subsidised rents are being paid either in old-style ‘council housing’ or in the many, newer variants of social housing run by the non-profit sector

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with various government subsidies to keep rents down. It is obviously easier to enforce anything with parties that are reliant to some extent on financial support from the enforcement agency. However, the private, market-oriented rental sector is a very different problem. In a neoliberal capitalist society, interference with private property and profit tends to be seen as a difficult matter and the political ethos is that it is to be avoided where possible. This view is also fostered by the various extremely powerful and well-resourced lobbying groups from the private-sector building and rental sectors which do their best to encourage legislation that improves their profits and to discourage any that might constrain them. Local authorities are not actually empowered to take action about some poor housing conditions in the private rental sector, because it is private; nor are the expectations that local authorities will act as strong as they are in the social housing sector. Indeed, the ‘Decent Homes’ guidance states that, in the private rental sector, tackling poor standards should rely on ‘a range of assistance, advice and encouragement to homeowners … using enforcement powers only as a last resort’. Only when so-called Category 1 hazards – conditions listed in Table 3.1 as type A, B or C – are so serious that the severity score for the risk to the occupants is high do they theoretically have to be dealt with via enforcement. When the score is lower, enforcement is discretionary. Once the enforcement of laws is discretionary, their impact will vary according to local and national political factors such as ideology and budgets. These also vary over time as elections come and go and as national and global economic changes affect budgets. In 2016 in England, for example, there was a Conservative government ideologically opposed to welfare payments and ‘red tape’, an austerity budget had led to deep cuts in central government grants to local authorities, the effects of the 2008 global financial crisis were still reverberating through the economy, and the newer negative impacts of the UK’s impending exit from the European Union (Brexit) were beginning to emerge. Taken together, these meant that factors influencing whether regulations are implemented – political will and capacity – were acting to reduce the frequency with which housing regulations were effectively imposed, particularly 54

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within the private rental sector. As a consequence, poor conditions involving risks to health – slum conditions, in other words – were becoming more common.

Informal housing and building standards Regulations about housing standards are not peculiar to the cities of the GN – substandard housing in the GS is not due to a lack of legislation. Nearly all societies have plenty of regulations on the books. In ex-colonies these may still be partly derived from the town-planning laws handed down by the former colonial power. For example, they could be modelled on British, French, Spanish, Dutch or Portuguese ‘norms’. However, they are much less likely to be enforced. In 1990, during a field trip with undergraduate students to The Gambia, one student project was on housing in Serrekunda, the country’s largest urban settlement. The students diligently interviewed various ‘key personnel’ in the urban council offices in Serrekunda, returning with photocopies of regulations relating to building standards. These included the usual array of requirements about types of building material, distance between buildings, room size, windows, and minimum water and sanitation standards. These were all ‘modern’ and were drawn fairly directly from British legislation of the 1940s and 1950s. The students suggested that this meant Serrekunda had been ‘planned’. However, a moment’s observation of nearly all the residential built environment in the settlement demonstrated that the regulations had not only been honoured mainly in the breach rather than the observance, but in fact entirely in the breach. To a significant extent, Serrekunda was constructed of corrugated iron sheets. Many households were renting and living in one small room in buildings often built and rented out by the owners of the rural land plots onto which the settlement had encroached and sprawled. These buildings did not conform to any urban plan or regulation; neither did their tenure. Many obtained their water from wells, just as previous rural populations had done. The case of Serrekunda demonstrates that, as with all laws, it is not the existence of the legislation that really matters but whether it is implemented. Leaving aside the issue of affordability, standards can only lead to improved 55

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housing if there are two key things: the political will and authority to enforce the regulations and the institutional capacity to implement and monitor that enforcement. The example of the UK above has already suggested that political will can ebb and flow. The housing dilemma as defined in this book, whereby there is a mismatch between low incomes and the costs of housing provided by the private sector, is specific to situations in which housing is decent because certain standards are enforced. However, if they are not, the private sector can deliver housing that is cheap enough for most people. Some of this will be in true slums, but not all of it. The informal housing that is so widespread in the GS is cheaper than formal housing not only because it may skimp on physical quality. Often, an important reason why it is affordable to the poor is that the land used at the time of building was cheap. This might be because it was originally occupied by squatting. However, the tenure may simply be non-capitalist. Hundreds of millions of informal private-sector residential units, both for owners and renters, are found in the urban areas of the GS (see Chapter 4). The meaning of the term ‘informal’ is often contested,20 but here, in relation to housing, it is defined as housing that does not conform with government planning, zoning, tax regimes, regulations and standards. By definition, therefore, this crucial housing sector does not comply with housing standards. However, improving this situation without causing worse health and suffering is tricky. As the next chapter will explain, removing such housing because it is poor quality is not the answer. This merely treats a visible symptom of poverty without doing anything about the causes. Invariably, those displaced simply have to adopt other informal solutions, and these are often worse for their welfare. The answers have to lie with assisting and encouraging upgrading of housing in situ – which generally happens anyway where occupiers are also homeowners, their incomes allow and they feel secure – or with providing state-subsidised decent alternatives. Housing standards in the Global South: Zimbabwe example

The outcomes of adherence to inappropriate housing standards and ill will on the part of governments that punish poor people living 56

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in informal housing have been well illustrated in the cities of Zimbabwe. Yet this also shows how complex the situation can be, since political attitudes and incomes are not fixed but change over time. The fixation with standards evident in this case also helps demonstrate how differences between the GN and GS may be less marked than supposed. As explained in Chapter 2, the cities of the countries of southern Africa that were once ruled by white minority regimes are all of colonial origin and are premised upon a crucial difference between them and the urban colonial experience in many other societies, except in Latin America: that is, usually nearly all the land on which they developed and their surrounding areas were alienated from the original occupants and either owned by the state or held privately. In both cases, the norms and legal underpinnings of capitalist property were dominant, backed by the necessary institutions. In this regard, cities such as Harare, Windhoek and Pretoria are more like American or European cities than they are like other cities in much of the rest of sub-Saharan Africa, where pre-capitalist tenurial arrangements remain significant. These circumstances made it easier to control residential housing developments and to exclude Africans from ‘white’ cities. Although these controls broke down towards the end of liberation struggles to end white minority rule in all three countries (Zimbabwe, Namibia and South Africa), and squatter housing on private and public land emerged, in Zimbabwe most of what was a fairly limited amount of such housing was removed after independence in 1980. Crucially, at that point many of the occupants were moved into highly subsidised new site-and-service schemes and not left to fend for themselves. This left Zimbabwe, uniquely in sub-Saharan Africa, with an essentially planned and regulated residential urban landscape by the mid-1980s. In other words, cities such as Harare and Bulawayo were more like London or Birmingham in terms of land tenure, property rights and regulated housing than they were like Dar es Salaam or Lagos or Kinshasa. And the government was determined to keep it that way. Over the next 20 years, up until 2005, Zimbabwean urban housing projects ostensibly targeted at low-income groups varied 57

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somewhat in their characteristics, particularly in terms of the degree to which state or donor subsidies were provided to make housing more affordable for the poor. These shifts were in line with global neoliberalism and the shift to more market-oriented policies generally; some of the outcomes for affordability have already been discussed in Chapter 2. On the whole, most planned urban housing had been delivered through site-and-service schemes and the official focus was almost entirely on homeownership, as is common throughout the GS. In such schemes, residents purchased a plot and then built a house, hiring their own builders and/or using their own labour. However, they had to comply with a host of building standards. Throughout the process, the housing built was closely regulated and monitored by local officials. Key regulations included the conditions that the plans were approved by the municipality, the houses were fully serviced with water and sanitation, and they had proper foundations, a concrete slab floor, and walls of fired brick or cement blocks. The roof had to be asbestos, metal or tiles. In theory, homeowners were meant to construct a four-room unit and ablution facilities within 18 months, although often they could not afford this and a blind official eye was usually turned as long as some progress was occurring. As explained in Chapter 2, many of the poor could not afford to be allocated a plot at all. Some who did manage to convince schemes that they could afford the costs then found them too much to bear. In Zimbabwe in the first decade or so after independence, there was the political will to maintain regulated standards. The government also managed to maintain a situation where there was very little squatting. In any case, it was not generally possible to build urban homes in the immediate rural hinterland by taking advantage of non-capitalist tenurial arrangements (although this constraint was to change when fast-track land reform began in the twenty-first century, reshaping the city’s residential geography in significant ways). This feature meant that it was possible to believe that urban housing processes could be controlled, in contrast to the situation across other parts of the GS. In addition, due to a curious mix of a positive desire for poor urban residents to live in decent housing and an official compulsion to exert control via planning, the vast majority 58

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of Zimbabwe’s urban residents did not live in ‘slums’ (as defined by UN-Habitat) by the turn of the twenty-first century. They mostly had on-plot access to sanitation and clean water and accessible clinics and schools. There was no pretence that the private, market-oriented, large-scale housing industry could possibly provide affordable housing, given local incomes, and, as shown for the case study of Glen Norah C in Chapter 2, efforts to bring in private loans for selfbuilders on already subsidised land had made even these schemes problematic. But Zimbabwe’s urban housing situation was bursting at the seams. The maintenance of building standards made even lowincome schemes too expensive for a large sector of the population. They could only afford to rent; homeownership was simply beyond them. Thus, many of the rooms in the new ‘homes’ in the housing schemes and in the older townships of the colonial period were rented out. The ideal of one family per house, which fitted with the decent home concept, was fairly rare, especially in the high-density suburbs closer to city centres. In fact, in many houses the norm was more like one household per room, just as in nineteenth- and early twentieth-century Edinburgh or St Petersburg. Overcrowding was rife. And adding to the density of population, there was such a huge demand for rental housing that many plot-owners took to increasing their incomes by building backyard shacks. These were extensions or freestanding units built in any spare space on the plot behind the house: each had a household living in it or some were shared between lodgers. Complex subletting arrangements developed. In the areas most accessible to work, such as Mbare, Harare’s oldest township, shacks were sometimes eventually also built in front yards, in the gap between the house and the road. In most cases the homeowner also lived on-site, but there was a significant minority of absentee lessors. Besides the overcrowding, the insides of houses were often very poorly finished (no ceilings and unplastered walls, for example) as this was not regulated and had no structural implications. This did, however, undermine the comfort of the tenants. Planning regulations made it clear that backyard shacks and unplanned extensions were illegal. So why, given its success in preventing squatting, did Zimbabwe allow the backyard shack situation 59

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to develop? The answer lies in a complex mix of national and city politics, with different city governments taking different attitudes over time. One factor was a gradually developing degree of pragmatism in the 1990s as the housing affordability problem became increasingly acute. Household incomes took a steep dive and fewer new subsidised housing schemes were built after structural adjustment policies were introduced in 1991. There was an element of genuine concern about increasing urban poverty at the time, and the backyard shacks ‘helped’ by providing affordable, if problematic, accommodation. Unless the state had been in a position to allocate to their residents subsidised houses in new site-and-service schemes, it was hard to see a ‘humane’ alternative. However, at the same time, and often in the same official circles, there was outright opposition to this ‘informal’ type of housing solution, which evidently undermined Zimbabwe’s aspirations for planned and tidy urban landscapes. In other words, the commitment to holding the line against backyard shacks fluctuated, and in periods of relative laxity and few demolitions, tens of thousands were built. Given income levels and the mismatch between the supply and cost of affordable housing and the demand and need for it, inevitably some squatting did occur after independence, here and there. In Harare, for example, there were various small-scale occupations, usually on public land. These were never allowed to last for long, however. Once demolished, some of their residents were moved to ‘holding camps’, usually on the edges of the city and sometimes on agricultural land. Over time, these sometimes took on their own community identity, but their residents’ lives were made terribly difficult because the government would often move them on again, sometimes to another holding camp. Tragically for Zimbabwe’s urban poor, the forces already in existence in official circles that were opposed to the slippage in housing standards were suddenly given free rein and full central government backing in 2005 when ZANU (PF), the party in power since independence, lost both a referendum on constitutional change and nearly every urban constituency in a national election. Furious that the urban electorate had not ‘recognised’ its obligations to the party, which, despite its inner convictions, had allowed backyard shacks 60

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to develop to ‘help’ the poor, the government unleashed Operation Murambatsvina (‘Clear Out the Trash’) with virtually no warning. Every single backyard shack and unplanned house extension in lowincome urban suburbs across the country was demolished within a few weeks, using bulldozers. Informal-sector activities were also targeted. It was estimated that 650,000 to 700,000 people were either made homeless or lost their jobs, or both.21 There was an international outcry and the UN sent a special envoy, Anna Tibaijuka, to investigate. Understandably, the political punishment angle was frequently highlighted in subsequent analysis. Yet, while this was relevant, it helped obscure some other aspects of the campaign that only made sense in terms of understandings about private property, housing standards and urban planning regulations. First, the campaign did not touch planned and legal private or rented properties, which also housed many of the ‘ungrateful’ urban electorate. Throughout the country, the legal home on the urban plots affected was left standing, surrounded by the rubble of demolished extensions and shacks. Thus, the legal property of low-income urban plot-owners and homeowners was respected. Second, in the ‘holding camps’ such as Hatcliffe Extension on the north-west edge of Harare, the houses demolished were generally those built without local authority support, meaning that services had not been laid on and they were not connected to the networks for sewerage, water or electricity. According to the regulations, this made them illegal. For the international media that were soon on the spot, these issues were not visible (pipes being underground) but the demolition of what were often freestanding small houses constructed of permanent materials such as brick or cement blocks was very evident and understandably condemned. To complicate matters further, unlike backyard shack residents, some in the holding camps had title deeds to their plot of land that local politicians had made available during electioneering periods. Again, the media and many other analyses made much of this, taking it to mean that legal private property had been destroyed.22 The Zimbabwean government defended itself on the grounds of planning and building standards. It pointed out, correctly, that backyard shacks were illegal and if homeowners could show that they had 61

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received planning permission for extensions, those extensions were not demolished. They compared the upholding of housing regulations with the situation in cities across the GN. They also explained the nuances of the planning and standards issues that led to so many unserviced and improperly planned and regulated houses being demolished in the holding camps, even if they had been built on land with legal title. None of this cut much ice with the various media, campaigning and agency reports that followed, which was not surprising. The extent of suffering that was caused was catastrophic: no provision was made at first for anyone made homeless, people were scattered across the country and some were forced to take up crossborder peripatetic lifestyles. Many people died.23 Nonetheless, the UN report on the campaign, which rightly decried the suffering and the lack of timely warnings of the demolitions (which was illegal), did note that the government was right on the legal points about standards and planning. Nearly all the demolished dwellings had been illegal. Thus, this infamous Zimbabwean example provides insights into how complex the relationship can be between housing standards, residential planning laws and the availability of affordable housing. Earlier it was argued that housing standards are a double-edged sword, but this example shows how there can be even more sharp edges to their impacts. They can be used as a weapon by governments to evict those whose housing is ‘not up to standard’ if and when the state deems it expedient. Housing standards and the colonias on the borders of Texas and Mexico

Along the border between Texas and Mexico there are many small residential settlements termed ‘colonias’ that house urban people on the US side. These have had somewhat ambiguous status, including whether they are rural or urban, under whose jurisdiction their management should fall (the ‘rural’ counties or the cities), and the legality of many of the plots and houses on them more generally. On the Mexican side, there are many larger colonias, but their existence is relatively ‘normal’ there. These settlements are an exceptionally useful example of the issues under discussion: the impact of 62

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housing regulations, standards and embedded societal expectations on the cost (and therefore affordability) of housing. Furthermore, they provide an unusual comparative GN versus GS example that helps to further illustrate the arguments proposed in this book about the similarities in key processes underlying housing affordability issues in rich and poor countries across the world. They also challenge any presumption that, besides the difference in wealth between these regions, housing outcomes in the GS are worse because their institutions, accountability and capacity are inherently more problematic than in the GN. These settlements have been extensively studied by Peter Ward of the University of Austin in Texas.24 Most of his work has been on housing processes in Latin American countries, which helps provide depth to his comparative analysis and a critical perspective on North American norms. On both sides of the border, many houses in the colonias have (or originally had) questionable ‘legality’ in much the same way as many of the houses in the peri-urban ‘holding camps’ of Harare in Zimbabwe. While on the Mexican side some colonias involved illegal invasions onto land, both in Mexico and Texas their first residents more often occupied subdivided land provided via some sort of deal, often done by intermediaries, with local landowners. In many parts of the GS this might be tolerated. However, for the American authorities, it was a significant problem that this land was not zoned as being part of the nearest town. Services such as water, sanitation and electricity, as well as compliance with various urban building codes, tend to be required for houses to be accepted as legal in the American urban context. Since these settlements did not comply, the houses built fall short in terms of acceptable standards and can be deemed ‘illegal’, just as in Harare. By the mid- to late 1990s, there were over 1,500 colonias along the Texan border, housing around 368,000 people. In 2018 it was estimated that about half a million lived in this type of settlement.25 The residents were there because of the housing dilemma: their incomes were insufficient for them to occupy legal housing within the city. Taking up subdivided land on farms in the hinterland – even if its tenurial status was uncertain and they knew they were being exploited by dodgy developers – and gradually building homes, even 63

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if these were non-compliant and had no piped water or electricity, was all they could afford and allowed for some sort of family life. On the Texas side, most of the residents are Mexicans or MexicanAmericans. As Ward explains, ‘Few Mexicans or first-generation Mexican-Americans working on the Texas border earn enough to afford housing at market rents or qualify for traditional home financing … many of these workers [at the end of the 1990s] earn as little as between $5,000 and $10,000 a year.’26 He also explicitly links the issue of (important and necessary) ‘standards’ and the unaffordability of housing. Thus, residential land within a Texan town must have ‘paved roads, curbs, drainage, and hookups for water, sewer, and utility services … These requirements, while beneficial to public health and safety, have the effect of excluding low income people from the urban housing market.’27 Similarly in Mexico, the laws and regulations governing urban land development and housing mean that ‘almost without exception’ the market price of urban land is ‘beyond the reach of most poor families’.28 When the Texan colonias first began to emerge, the subdivision and sale of farming land close to border cities was legal enough as the local ethos in Texas, possibly more than almost anywhere else in the world, would be to support the rights of landowners to do as they wish. By selling subdivided plots, farmers could get at least double their value as agricultural land but still sell at prices ‘that verylow-income people could afford’.29 Often the farmers sold to developers who then sold the plots on. The conditions of sale were highly exploitative at first, under the terms of the ‘Contract for Deed’ system that was widespread in the USA. This meant that, although initial payments to start the contract could be extremely small, the land could be forfeited back to the seller at any point if any payments were missed, even if the buyer had been paying regularly for years. Land title was available only once the full purchase price had been paid. This could not be regarded as ‘security of tenure’. Several improvements began to be introduced after 1995, however; for example, once 40% of the price or 48 monthly instalments had been paid, the contract conditions changed to those for a proper mortgage, with far more protections for the purchaser. Originally, the plots were also

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sold without any services – ‘unimproved’. This was also legal at first, and anyway, rural counties, under whose jurisdiction the colonias fell, had few powers to enforce building codes. However, again in 1995, there were legal changes in some counties where colonias were developing, which meant that developers had to get county approval for subdivisions and, crucially, had to supply water, sewerage and drainage to them. This ushered in the double edge of the sword of decent, regulated standards because, of course, this would have made any new plots too expensive for the poor people who were the only ones ‘interested’ in buying in these distant spots that remained unintegrated into the towns. Indeed, ‘stopping the proliferation of new colonias’ was the aim of the new laws.30 On the Mexican side of the border, colonias were very much larger, much more common and representative of low-income urban housing ‘solutions’ across the country, although at root caused by the same issue of unaffordability – it was just that the scale of the problem in a country with much lower typical incomes was very much larger. As Ward argues, they ‘respond to a common logic’.31 However, in line with processes across much of urban Latin America from around the 1970s, gradually they tend to be integrated socially and politically into the nearby municipalities, crucial infrastructure (water, electricity, etc.) is extended to these areas, and tenure is regularised. In many ways, local authorities and political processes are much better at dealing with colonias in Mexico than in Texas, and the outcomes for their residents are more positive in terms of addressing the issue of housing affordability. One key difference between the two sides of the border – one that is of special relevance for the theme of this chapter – relates to approaches to and understandings about the significance of building standards. Colonias, with their lack of ‘proper’ infrastructure for clean water, sanitation and electricity, and their often poor-quality housing that did not meet urban standards, were an embarrassment in Texas, representing ‘Third World conditions in a First World country’.32 In Mexico they are seen as an ordinary, if not ideal, housing solution for the working poor and it is assumed ‘that the government is required and expected to provide water and sewer services’.33

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In common with historical colonial attitudes to low-income settlements around the ‘European’ cores of the main cities of Africa and Asia that ruled and channelled the products of European colonies, Texas saw colonias in terms of a ‘sanitation syndrome’34 and as hazards. And, again in a historically similar process, the settlements were largely ignored and not perceived as a responsibility of ‘the city’ (which had financial implications) until ‘health problems bred by unsanitary living conditions in the colonias threatened to spread to non-colonia populations’.35 The responses tended to be technical – to address water issues, for example. However, the entrenched norms of monitoring and implementing building standards and sticking to regulations, as in the UK, were actually hindrances to improving the situation. As Ward notes, where there was non-compliance with various housing planning regulations and standards, or with environmental and health rules, ‘Texas regulations prevent[ed] service provision’.36 By the 1990s, legislative change provided public funds to improve water provision in the colonias, because of health concerns, but this had been predicated on new laws to prevent further colonias developing. Also, houses could not get new gas or electricity services unless they complied with water and sewerage regulations. Ward made the logical recommendation that housing in the colonias would improve faster, because house consolidation by inhabitants and infrastructural upgrading would be easier, were minimum standards temporarily reduced either for these settlements only or even for ‘certain submarkets of housing production statewide’. The issue of building standards in this debate has been existential, in a sense, for both the residents and the regulators: in 1999, had the various codes relating to the construction of houses been enforced, ‘most colonia homes … [would have been] subject to demolition’.37 But accepting lower standards means that officials have to think about why this is happening, which swiftly leads to an acceptance of the highly uncomfortable truth (for American officials) that market forces and private enterprise are incapable of housing many members of society. And, if lower standards are regarded as anathema, then the next realisation is the need for mass public-sector housing programmes, which, in the US today, are also anathema. As in many 66

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other parts of the world, it is therefore easier to stick to a technocratic response, which ignores the ‘root cause of colonias’ [or any informal settlements’] creation in the first place: poverty’.38

What standards are appropriate? It has been established that housing and building standards are key elements of the affordable housing dilemma. However, it is important to keep in mind that they are not the root cause, unless it is argued that there should be a return to the urban death and disease rates of the nineteenth century. There are some ways in which fiddling with standards may help affordability and instances where local legislation may be inappropriate for income levels or climatic conditions. Even a seemingly objective measure as per capita space requirements can be adapted to local circumstances. The impact of overcrowding on residents is affected by a variety of factors, including architecture, but important aspects are the prevailing weather and the availability and nature of outside space. Sleeping in a crowded environment is hazardous to health, but if many other household activities can often occur outside the physical building where people are accommodated, the stress and discomfort of overcrowding are mitigated and requirements about light in rooms are less important. On the other hand, in cold climates or tall apartment blocks, the physical confines of the available built living space become hard limits. The availability of electrical power is a wonderful thing for any home but may be far from the top-ranked need for poor households. Yet it is close to existential for those in high-rise apartments: if the lifts and water-pumping arrangements do not work, an informal one-storey home may seem more comfortable and far less stressful. Thousands of years of architectural design experimentation to reduce indoor temperatures and keep air circulating in homes in cities where temperatures get very high, such as in North Africa and the Middle East, may be ignored by the imposition of ‘modern’ standards that are often shaped by Eurocentric climatic norms. Rather obviously, with climate change making heat a major hazard in far more cities, housing standards need to learn from these adaptations. Standards also need to consider local cultural norms; 67

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these may be reflected in the way homes are constructed, such as having rooms looking inwards onto central courtyards, away from roads and alleys, as was traditional in many Islamic cities. Indeed, households lucky enough to be allocated public-sector housing in many cities in the GS often reshape their internal arrangements so that they reflect their needs more closely, although some of this relates to squeezing in extra bedspace.39 There is much research and experimentation all over the world to find cheaper building materials, sometimes with a second objective of trying to reduce the environmental impacts of housebuilding. Sometimes laws need changing to allow these to be used in towns. Cement, for example, is a significant source of greenhouse gases during its production, is used in commercial house bricks and blocks, and is expensive. As already noted, mud bricks, which are often used in rural areas, can be used for one-storey houses, and the use of fired (kiln-baked) mud bricks in urban Zimbabwe was legalised in the late 1990s in one attempt to reduce building costs. Stabilised soil bricks use a fraction of the cement of normal bricks and use compression to make them structurally strong, rather than firing. This is another way of reducing the economic and environmental cost of wall construction, while interlocking varieties also reduce the cost of cement for mortar to hold bricks together.40 Various materials using bamboo are another environmentally sound and cheaper way to build.41 However, although the promotion and legalisation of cheaper materials such as these may help, they will only reduce at the margins the numbers of people in any urban society who are caught in the housing affordability dilemma. After all, standards in the UK allow for the possibility of building a house using straw bales for the walls, but this has evidently not addressed the housing affordability issue there. This is because the cost of the walls of a home in a city is only a very small fraction of its total costs over time. It is even a fairly minor element of the cost of the materials for the house per se. The costs of floors and roofs, windows and doors are all significant, and once the house goes beyond a single storey, cheaper wall materials may not work structurally – they definitely do not work for a high-rise building. 68

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Another way of recognising the limitations of a focus on the costs of building materials is to realise that households may be able to afford to build solid, decent homes in rural areas using conventional, modern building materials but cannot afford to do so in the urban area where they need to be to earn a living. There are various reasons why. A significant one is the much higher cost of legal urban land, which is why there is so much emphasis on ‘providing’ such land in analyses of urban housing shortages. Certainly, if urban land were available at the same cost as remote, rural land, housing costs would fall sufficiently to allow very many more to afford an urban home. But, as previously pointed out, this only serves to prove the key argument: that urban housing costs set by formalsector private, market forces are unaffordable for large swaths of urban populations. There are also the costs associated with energy, water and sanitation service infrastructure and, what is sometimes forgotten, the recurring costs of using these services. The density of urban populations – and density is a defining aspect of urbanity – may make many low-cost solutions such as wood fuel, pit latrines or wells problematic or downright dangerous, although they can work in some circumstances. There are some good reasons why urban housing standards are different from rural ones. Urban local taxes or rates to pay for other crucial services such as roads, street lights or policing add more costs. Also, some of these issues about ‘inappropriate’ standards affect homeowners but are of less relevance to renters. The proportion of people who rent varies greatly across the world, with no clear pattern between the GS and GN, but broadly speaking it is more prevalent among poorer people (partly, of course, because they cannot afford to buy). As already explained, many of the regulations about housing in the UK are about rented accommodation because that is where the most flagrant and dangerous conditions tend to occur – the historical background to the development of ‘standards’ legislation needs to be remembered. But in much of the GS, renters have very little protection and are faced with dangerous and demoralising housing conditions. More regulations, not fewer, might help them. In Zimbabwe, in the planned low-income areas where the main targets of demolitions in 2005 were backyard shacks, most 69

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of those rendered homeless were tenants, while plot-owners and homeowners were left untouched (although they lost a significant income stream from forfeited rents). While each element of ‘standards’ can be debated and possibly adapted to local circumstances, this can miss the point that the costs of a legal, formal, urban home that is located so that it is realistically possible for its inhabitants to be part of the city’s economic and social fabric are an assemblage of many market-set prices for different elements. In the end, once it is accepted that standards are necessary to keep people alive or healthy, it makes more sense to start with the issue of affordability and the profiles of disposable incomes (i.e. after tax and other deductions, and after basic needs such as food, water and clothes are taken into account) that are typical for the society in question. These can be used to create the housing affordability curves discussed in Chapter 2, which provide an indication of how many urban citizens cannot ‘afford’ formal-sector, market-priced housing. Where, as is common, there are significant differences in such profiles and housing costs between cities in any one country, with the capital city often far more expensive but also with very significant proportions of very poor people living alongside the country’s wealthiest, then separate affordability curves are needed. If these, for example, show that 50% of households in any one city cannot afford to pay the upfront and recurring costs of the cheapest, legal urban home, then it becomes apparent that reducing the costs of wall materials, or whatever, may help only a small proportion of these people and that the scale of the problem requires a different approach. The bemoaning of inappropriate standards in housing in relation to the GS also has to be treated with some caution, as, although there are historical links to European standards, there have also been sensible adaptations in many countries. Furthermore, as noted earlier, implementation regimes, rather than laws themselves, are really more important. The vast majority of homes that do not meet standards across the GS – and also many in the GN – are not under threat. Knocking down unplanned extensions, as happened in Zimbabwe, is usually a GN issue. A bigger threat often arises over tenure – where homes are built on land under arrangements that are 70

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not seen by city officials as legitimate, particularly where the land occupied has, or has come to have, high value that more powerful interests want to obtain. Legislation about standards in the UK, for example, does not mention this: that is, there is no ‘rule’ in the statutes which says that rented or owned houses must have legal title to the land they occupy. It is largely taken as read, but for housing standards in the GS, it is quite often the ‘big issue’. So what types of urban housing have been and are being produced in the world’s large cities? How affordable have they been and how affordable are they today? What makes houses more or less affordable for ordinary urban residents? How have all the hundreds of millions of urban households in the lower bands of national income groups managed to house themselves? What forms does their housing take? The answers to these questions involve a complex mix of private- and public-sector actors, trends in political economic ideologies, changes in the share of national income accruing to working people and those too old to work, key historical moments that create space for progressive outcomes previously constrained by powerful vested interests, and the history of past and current modes of production that underpin the ways in which urban land is owned and transacted. These are the topics of the next five chapters.

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Chapter 4

Private-sector urban housing provision: formal and informal

In the Global North (GN), most urban housing was built by the formal private sector with the aim of making a profit. In the Global South (GS), much, and sometimes most, was built by the informal private sector – if this is understood to include ‘self-help’ housing where homes are, usually gradually, built by their owners. The informal sector also builds plenty of for-profit housing, usually for rent, and many ‘self-builders’ pay small-scale informal enterprises to help build their houses. Many homes are also built by the public sector for renting, or homes for buying are subsidised by governments, not-for-profit actors and donors of various sorts. The focus in this chapter is on private-sector delivery of rental houses and houses for ownership by both formal and informal actors, with an emphasis on what has happened and why and the outcomes for urban populations. Key themes are the similarities and differences between these sectors and the pros and cons of each in terms of affordable housing ‘delivery’. There are some straightforward similarities between the formal and informal housebuilding sectors in terms of market forces that influence things such as the pace of building, the height of houses or rental units (one storey or more), and relative rents or costs (within the sector). These include the way in which relative demand for the house or room is influenced by its location: the nearer to the inner 72

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city or other employment hubs, or to fast transport, the higher the demand and therefore the price and the likelihood that it is profitable to ‘build up’ and add storeys. The usual ‘rules’ of the economic geography of any urban settlement pertain for both sectors. There are also similar influences on the extent to which houses originally built as homes for a family or one household may now also contain lodgers, or have extensions built to house lodgers – swings in income and domestic household cycles among them. The cost of materials such as cement, sand and roofing will feed through to costs in either sector, as will the ways in which any government subsidies or restrictions on, for example, imports affect their availability and price. But factors such as these are rarely at the forefront of comparisons between the sectors. Much of the housing literature, with its tendency to analyse urban housing in the GS and the GN as distinctive subsets that do not require cross-comparison except to note their differences, tends to be negative towards urban housing in the urban GS. The emphasis is usually on the poor quality of housing and services for many residents, and on institutional ‘problems’ in GS cities which hinder the achievement of the housing norms of the GN. The term ‘slums’ may be used loosely in such discussions, despite decades of efforts by thoughtful housing scholars1 to limit its use to very specific housing types. It is rarer for analyses to consider which characteristics of GS urban housing, especially informal housing, offer anything positive for urban people, or how they might add to understandings of housing issues in the urban GN.

Formal-sector, large-scale, for-profit housing Many urban settlements in Europe and Asia and in parts of Africa are very old and some of their housing stock reflects the workings of modes of production with class and land ownership systems that pre-dated capitalism. Much has been knocked down and replaced, of course, sometimes facilitated in large industrial cities by the bombings during World War Two. Smaller towns in Europe, such as Bury St Edmunds in the UK, Verona in Italy or Carcassonne in 73

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France, often have better-preserved sections of still inhabited housing built in a pre-capitalist era. Much has been fully incorporated into the capitalist land and housing markets since the institutions of capitalism came to dominate. Although the building types and materials do not comply with modern regulations, this is understood to be inevitable and only gradual modernisation occurs as houses are maintained over time. GS cities such as Beijing, Mumbai, Kano, Kochi, Timbuktu, Addis Ababa, Istanbul and a host of others all require an understanding of pre-capitalist land and property systems and regulations about the built environment if some of their housing, and their more general built environment, are to be interpreted. In many, more than two modes of production are still evident – Addis Ababa, for example, started afresh (and very late by world standards) as a feudal city in the late nineteenth century. Then, without much change, it became a Marxist-Leninist city after a revolution in 1975. After a subsequent revolution in 1987 it shifted down the path of capitalism and market-oriented urban policies and influences. However, Addis remains an extraordinary mixture of forces, because, while the government ‘talks right’ to appease the global forces of capitalism and entice foreign direct investment (FDI) from anywhere it can, especially China, the state is still inclined to ‘walk left’ and intervene in the housing market, inter alia, far more than is usual for an African state. The point is that some of what looks ‘informal’ to the modern, capitalist eye is actually what used to be formal under a previous mode of production: that is, if, as argued earlier, informality is understood to be housing (or any other activity) ‘which does not conform with government planning, zoning, tax regimes, regulations and standards’. This is not to say that pre-capitalist cities and societies did not have their own complex sets of laws specific to urban settings, it is just that they were different. Modern critiques that blame the state for not preventing the emergence of poor housing may lump in such ‘historical’ housing with newer informal settlements built perhaps hundreds of years later and probably far from the historical centre of the city. It is also worth remembering that in many GS societies, with important exceptions including China, Latin America, South Africa and Ethiopia, the ‘state’ was a capitalist European power 74

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until halfway through the twentieth century (and even later for some African countries). Very often, the seeds of the later housing conditions of mass informality were sown during that period due to colonial authorities’ lack of interest in the conditions of the urban workforce; until the early decades of the twentieth century, this was precisely the attitude of their ‘home’ governments towards most of their own urban citizens. However, by definition, colonial subjects were not citizens with democratic powers. This made it easier to ignore the situation in the colonies, and the generally racist attitudes of colonial powers greatly compounded this neglect. The costs of regulating housing were another ‘disincentive’ for colonial authorities – not only because of the direct costs of implementation and monitoring but also because the inevitable increase in housing expenditure by local urban workers would have pushed up labour costs and depressed profits or increased the colonial public-sector wage bill. In any case, in a colonial situation it was much easier for those in government and in charge of European enterprises to segregate themselves away from the rest of the city – ‘out of sight (and with no vote), out of mind’ – even if every now and then some worse than usual epidemic caused a flurry of ‘sanitation syndrome’ demolitions. Such segregation was normal practice in most large European colonial cities across Asia, Africa and Latin America. A key objective was to reinforce, via the cities’ residential and administrative geographies, the socio-political divisions between the rulers and the ruled determined by colonialism itself. The degree and nature of such segregation were influenced by the pre-existing urban geography. The ‘European’ zones could be tacked on or located in areas previously occupied by but forcibly annexed from the indigenous city. In eastern, central and southern sub-Saharan Africa, where precolonial cities were rarer, it was easier to plan segregation into the urban form from the start. The legacies of these colonial urban policies are still written in the physical urban landscapes of cities that formerly experienced European colonial rule.2 These historical aspects of the ways in which housing has been ‘delivered’ in the past are important to bear in mind when examining the nature of the existing housing stock in many cities and the role of the private sector (under any mode of production). However, 75

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the analysis in this section mainly confines itself to the modern, capitalist era of formal housing production. The United Kingdom is a useful place to start, since this is where that era began, and it provides a useful European example, although every European country has its own variations on the themes discussed and the UK is atypical in some respects.3 In the UK, the slum conditions so typical of its industrial and major cities in the nineteenth and early twentieth centuries were proof in themselves that capitalist institutions per se and market forces were not up to providing decent housing for the majority. The ‘sanitation syndrome’,4 whereby the wealthier property-owing (male) urban classes, who were the only urban people with votes for most of this part of the capitalist era, became concerned about these conditions the more they were perceived to threaten their own well-being, combined with a small but significant philanthropic swing towards providing decent rental housing for small groups of fortunate urban workers and their families from the end of the nineteenth century. However, the philanthropic approach was not for profit and was thus further evidence of the inability of private enterprise to provide decent housing conditions for poorer urban citizens. In the absence of such philanthropy, a more common outcome of the ‘sanitation syndrome’ was one with which the cities of the GS, both during the colonial period and since, are very familiar: demolitions or ‘slum clearances’, with no – or completely inadequate – policies to rehouse the people evicted. Consequently, they just moved to other very poor housing, sometimes even more overcrowded with the sudden influx of evictees. For instance, in inner Glasgow in 1866, 88 acres of housing were demolished but the ‘displaced slum dwellers were forced to move into the next oldest properties, where the problems of overcrowding and squalor reemerged’.5 Similar outcomes occurred after the clearances of backyard shacks in Zimbabwe, described in Chapter 3, where two in five of those displaced squeezed themselves into the already overcrowded plot-holder’s house, in some cases reducing the space available to as little as two square metres per person.6 In the Glasgow case, the new houses that were completed by 1902 were of no relevance to the people evicted, being affordable only 76

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‘to well-to-do artisans, earning 24–30 [shillings] per week’ – a significant income at that time;7 this was and is a common aspect of such clearances and is familiar to residents evicted from welllocated city sites across the world. In England, key legislation of the nineteenth century included the Public Health Act and the Artisans’ and Labourers’ Dwellings Improvement Act (known as the Cross Act), both passed in 1875. These eventually led to significant public health improvements and the beginning of slum clearances in cities such as London. These did mean that the state had to stand up to the owners of private property and land, which proved highly contentious, even though the owners were compensated. What was also contentious was any suggestion that the state should intervene further in the housing market by directly building and renting housing to poor urban dwellers. As one contemporary commentator noted, ‘in the supply of dwellings as in the supply of food, for the self-supporting labourer … facts of quantitative insufficiency are for ordinary commercial enterprise to meet’.8 But the problem was that ‘commercial enterprise’ was making money from London’s slums in the absence of ‘decent’ standards that would have led to higher (and unaffordable) rents. In one of the most notorious slums, the Old Nichol in Bethnal Green, annual returns on these rental properties were up to 150% in around 1850. Thus, just as in the contemporary GS, the private sector was providing ‘affordable’ urban housing for the poorest but only because ‘decent’ standards were not observed. This is an important cross-regional point that is often missed because of the difference in timing. Of course, in England at that time, such standards were not legislated for or implemented, so the houses were not ‘informal’; furthermore, the land ownership was legal. Landlords in the Old Nichol remained as anonymous as possible, acting through intermediaries; in this area they were also represented by the ‘Bethnal Green Vestry, a squad of venal councillors who operated as the local authority’.9 This organisation did its best to prevent the slum being demolished because of its profitability, but eventually the new acts (which, once passed, did make places like the Old Nichol ‘informal’, in a sense) were implemented by the new London County Council. The slum was demolished in 1893. 77

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Shockingly, the ‘venal’ landlords then compensated included the Church of England’s Commissioners. Yet again, however, some of the original residents, ‘too poor to move elsewhere … were shoved into neighbouring streets, which in turn became slums’.10 Similar tensions between official desires to improve housing conditions towards the end of the nineteenth century and the vested interests of landowners occurred in Scotland, where ‘the dominance of local politics by property owners meant that little could be done, since to interfere in the housing market in such a profound way would have hit the pockets of the landlords’.11 Thus, across Britain, the housing dilemma was being played out: the poorer groups could not afford the then available legal, formal housing alternatives to living in slums. They were caught between a rock and a hard place, unless they were extremely lucky and somehow got picked for the very limited amounts of subsidised decent rental housing in private philanthropic developments. Provision by the state was slower to emerge, for ideological and political reasons. Looking forward to today’s housing situation in Britain, the comparisons are obvious. The economic ideology of reliance on market forces during the original ‘liberal’ and contemporary ‘neoliberal’ capitalist eras produces similarities in approach. These include a strong reluctance or refusal to accept that affordable, ‘decent’ housing for large sections of the urban population cannot arise from ‘ordinary, commercial enterprises’, a general antipathy towards public expenditure to help poorer members of society, and strong links between vested capitalist interests involved in urban land and housing and the government.12 Very gradually, as the twentieth century started, the government faced up to the impossibility of achieving any real progress in housing conditions if things were left to market forces and a few philanthropic projects. Public-sector, subsidised rental housing began to be constructed in British cities and the dilemma of the affordability and ‘decent housing’ nexus began to be addressed. As these programmes were scaled up, urban housing in Britain was utterly transformed. Such non-market solutions to the housing dilemma across the world are the key theme of the next chapter. In Britain, the dilemma was largely solved by this approach until the rise of neoliberalism under Margaret Thatcher in the 1980s began 78

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to reverse the situation and the affordability dilemma re-emerged in force (see Chapters 7 and 8). The impact of the ideological change on the relative output of private-sector housing versus the non-market sectors (public, local authority housing plus housing associations) after 1980 is clear from Figure 4.1. Also evident is the fact that there was no compensatory increase in private-sector housing completions to fulfil the extra ‘demand’ created by the collapse of new provision in public-sector housing. From 1980 until the financial crash, private-sector completions held fairly steady at around 150,000 per year. This is as expected, since much of that ‘demand’ was not the monetary demand that the private sector requires but actually a ‘need’. The subsequent collapse in privatesector output after the global financial crash in 2008 can also be seen, as can the failure of the market-oriented housing sector to pick up again since then. Yet again, the key reason is the lack of effective monetary demand and not, despite endless claims to the contrary from the government and vested interests, other types of constraints on supply. However, after the crash, the share of the urban population

Housing completions per year

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Figure 4.1  UK housing completions per year by tenure, 1949–2015 Source: 1949–77 from Office of National Statistics Historical Housing Data series; 1978–2015 data from Table 212 ‘Live tables on house building: new build dwellings’, GOV.UK statistical data set at www.gov.uk/government/statistical-data-sets/live-tableson-house-building, accessed 19 July 2016. 79

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‘priced out’ of buying or renting a house became very much larger than before, as incomes fell or stagnated for many yet prices soared in many towns – and particularly in London. The slum rental sector of the past in Britain, and elsewhere in industrialising Europe and North America, catered to the monetary ‘demand’ that families in the poorest deciles of urban income distributions could manage for housing. There is no doubt that many landlords could have provided accommodation that was somewhat less of a death trap for the rents charged, and their greed and neglect were rightly condemned, but at the same time what was affordable to the poorest was determined by their incomes, which were set by other economic forces. In some cases, employers provided housing for rent, in which case at least the rent and income nexus and responsibility for the outcomes were obvious. Occasionally, industrialists made some efforts to provide a standard of housing that was ‘unaffordable’ (i.e. the quality meant that rents would have been too high had they not been subsidised from profits). A notable example can still be seen at the UNESCO World Heritage Site for the Industrial Revolution in Saltaire, in northern England, where ‘model’ worker housing was built for his alpaca wool mill workforce by the industrialist Titus Salt to remove them from cholera-ridden Bradford. Here, the quality of the housing was a significant cut above the norm rented to workers at the time. However, other employers were essentially renting out slum accommodation. The proportion of the population stuck in completely inadequate housing, through lack of effective ‘demand’, varied across the industrialising world, between countries and cities, and over time. In some cases it would be most of the population, in others less than half. Above those in this section of the urban population, in the next lowest deciles of the income distribution were many who could afford something a little better, a bit larger, and rather more hygienic. They could also afford the transport costs from the ‘suburbs’ as cities began to expand. In Britain, where the railways began, and in London, the first city in the world also to have underground railways, there was mass private-sector, profit-oriented housebuilding to cater to these slightly better-off workers and their families. Many of the houses built were in terraces, a particular type of housing in the UK where 80

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many identical houses, usually of two storeys, sharing side walls are built in long rows. This method used land efficiently (for non high-rise building) and kept costs down. Most were built in the eighteenth and nineteenth centuries and were rented to workers and their families. Many earlier ones became slums and have been demolished. Those built at the end of the nineteenth century and afterwards remain very common in British cities but nowhere else in the world, including the rest of western Europe, perhaps because they were so typical of the world’s first Industrial Revolution housing in British mill towns and mining towns, as well as in larger cities, and became entrenched as a style. About 30% of England’s 22.2 million dwellings in 2008 were terraces, and just over a quarter of these were owner-occupied.13 The back-to-backs in Britain’s formerly industrial northern towns, including the UNESCO site at Saltaire, are terraces with a narrow alley between each pair of rows at the back. They have had a highly varied history depending on the fate of the city or town in which they were originally built. Where economies have suffered serious decline, usually in response to globalisation and the forces of neoliberalism, which has meant that the industrial or mining employment that underpinned them has dwindled or vanished, and the city population falls, the demand for housing in general also obviously falls. In such cases, these fixtures of the built environment are vulnerable to demolitions, especially if they are well located. On the other hand, as in London and in many of the towns in England’s south-east commuter belt, very similar small terraced Victorian-era houses are in huge demand and sell for many hundreds of thousands of pounds; some of the larger threestorey ones with cellars can command over £1 million. Yet many of the ordinary late nineteenth-century terraces in inner London suburbs such as Clapham, or in Haringey, were originally built to rent out, and the quality of construction was quite basic even if they did comply to some extent with the building bylaws introduced in 1875, which prevented some of the tiny, poorly lit rooms and unsanitary conditions of the slums. For example, they did not have bathrooms and their toilets were outside. The foundations would often not meet the construction standards required in the twentieth century: indeed, sometimes the back parts of these houses have no 81

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foundations at all. They were poorly insulated. Obviously, originally most had no electricity. Often a few houses in a row were built by one small private builder, and the next by another, with uniformity in size and plan laid down by covenants in the agreement made with the original landowner. Careful inspection today can pick out where a new builder started through visible small differences in external architectural decoration. The serried rows of such housing followed the trains and Tube lines out of nineteenth- and early twentiethcentury London as these were constructed. Rents were affordable for the middle- and lower-middle classes and the better-off working classes, with the larger houses often in multiple occupation, because the standards were quite low and the land, being peripheral at the time of construction, was relatively cheap. Still existing terraces are a fascinating comparative urban housing type. They are from the capitalist era and have always occupied land according to the norms of capitalist property rights. This latter point is crucial for comparative analysis. They might be seen as an example of private-sector for-profit housing that proved relatively affordable in the conditions extant during the era of their construction. However, looked at in another way, they can also be understood as an example of what is sometimes known in the GS as incrementalism and the process of in situ upgrading – a housing type that is initially below (today’s) ‘standards’ but over time, and often over generations, is upgraded to become more safe and comfortable, with better amenities. As in many countries in the GS, in Britain this used to be facilitated through government grants or subsidies to help owners improve their houses. All terraced housing now has electricity, for example, and virtually all have bathrooms and inside toilets. Most have modernised kitchens and central heating. The parallels between these processes in a GN society and the much studied processes of upgrading in cities from Lusaka to Lima are rarely noted. There are many factors influencing the extent and pace at which national private for-profit housing sectors build dwellings for sale or rent. They include historical norms (although these can change), culture and economic factors. Modal (rather than average) income levels and their reliability over time in relation to house prices and 82

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interest rates are obviously important but so are financial norms and attitudes towards lending large amounts of money over a long term. Government regulations about such financing play a very important role too. A horrendously irresponsible combination of these economic factors in the GN, mainly in the USA, led to the financial crash of 2008, which so dramatically reshaped economies, livelihoods and well-being across that region. One impact in the UK was to change radically the incentives in housing markets for rental accommodation. There was a huge surge in small to medium landlords buying to let, and corporate involvement in the sector for building to rent is also now increasing. For smaller landlords, changes in tax regimes that made their purchases highly profitable for a decade played a part. However, sweeping changes in the housing market have also occurred. There has been a phenomenal shift so that the proportion of the population that cannot afford to buy a home, or even aspire to homeownership, has greatly increased. House prices, which had risen sharply before the crash, fell in the immediate aftermath but subsequently rose again and soared in London and the south-east of England generally, while incomes stagnated or fell. Official estimates in 2017 forecast that the average British worker would be earning less in 2021 than in 2008.14 In other words, the affordability curve for this element of the market has shifted in a very negative direction. This cycle of house price rises peaked in 2017, but the shift in the affordability curves has been so large and fundamental that this is best seen merely as a reduction in the rate at which things are getting worse. As a result, the ‘demand’ for rental accommodation in the private sector has increased, and the market has responded. These issues are discussed further in Chapter 7, which considers the causes of the financial crash and its effects on global housing affordability and the ‘decency’ of rental housing. For the current discussion about private, formal-sector housing and affordability more generally, a key point is that only some in the new groups now ‘priced out’ of home ownership in the UK find that they are faced with the housing dilemma as defined in this book. Most people from the income brackets and types of work which, in the past, would have meant that they could reasonably 83

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aspire to homeownership can still ‘afford’ market rents and cover the costs of other basic needs such as food, utility bills and transport to work. Were this not so, the shift to the provision of significantly more for-profit rented accommodation would not have happened. However, the age groups most affected include many people who are at the point in their domestic lifecycle when they also aspire to setting up a new family household, with children. This has significant implications for the type of accommodation they might consider as necessary and appropriate in terms of privacy, space, number of rooms and amenities. Many consider a two-bed home as a minimum ‘decent’ standard, which is in line with expectations in the public rental sector (even if not necessarily enforced due to dwindling supply). As illustrated in Figure 2.2 in Chapter 2, this transforms the housing affordability analysis. Furthermore, the housing quality acceptable to aspirant family households increases housing costs above the average, as creeping non-compliance with and non-implementation of the regulations for ‘decent’ housing shifts some ostensibly ‘Global North’ rental accommodation towards the realms of informality (see Chapter 8). In sum, the issue of new household formation interacts in complex ways with the housing dilemma (see Chapter 9). The basic parameters of formal private-sector provision of housing for those sections of urban society that can afford the prices are now very much the same across the world. They are similar in cities as diverse as Mumbai, Manchester, Rio de Janeiro, Dublin, Addis Ababa, Atlanta, Lagos, Toronto and Tokyo. This is not to deny that there are always local institutional factors which influence financing and types of construction and that explain idiosyncrasies such as the prevalence of terraces in the UK. National policies, past and present, help to account for the significant variance in homeownership rates between countries, for example, and this point will be returned to later in this chapter. However, most of these differences are of marginal relevance to the arguments being made in this book about the inherent mismatch between market-based housing provision and the affordability of decent, legal housing for households towards the lower end of the income spectrum in all societies. The main, and crucial, exception is the institutional norms relating 84

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to land tenure, which are also discussed later. The key comparative point here is that wealthier groups have generally been able to afford and obtain housing through the formal, legal private sector. Thus, for them, the market ‘works’ unless socially discriminatory practices that influence who can buy what and where based on factors other than income, such as race or religion, are tolerated or even encouraged by the state. This was obviously the case in colonial states and in apartheid South Africa. It has also been true of the USA, where these practices often continued even when legislation to prevent them was passed.15 Furthermore, as will be seen in later chapters, presumptions about the capacity of the middle classes to afford market-priced housing are often now being challenged as the affordability crisis has worsened. In essence, though, the similarities between the workings of private-sector, for-profit housing markets and outcomes for the wealthier groups in urban societies across the world tend to be greater than the differences. Thus, critical analysis of these markets often comes back to the same issues (the geography of land prices, for example) and there tends to be more understanding that such processes in the urban housing markets in both the GN and GS bear comparison, rather than being somehow inherently different. For example, gated housing communities have been thrown up across the world in an effort by the wealthy both to separate themselves physically and to distinguish themselves socially from the homes and lives of ordinary, poorer people. Although the ordinary workings of capitalist housing markets always create differentiated residential geographies according to income, gated housing does this much more drastically and concretely, with negative consequences for the social and political sustainability of cities. These issues are written about across the urban spectrum – in Africa, Latin America, Asia, Europe and North America.16 In Africa, entire new towns – or ‘fantasies’, as they are called by the South African planner Vanessa Watson17 – have started to appear, or at least are being planned. These attempt to distance, in more definitive ways, the homes of the wealthy urban classes, many of whom can be considered part of the global transnational elite, from the older, messier and poorer cities such as Nairobi, Lagos and Kinshasa with which they used to 85

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have to cope. In all the larger cities across the world where global financial capital is strongly involved, whether in the GN or the GS, many other similar processes and phenomena with impacts on local housing are being studied and debated. Processes of regeneration and gentrification, for example, can be identified across the urban world and are discussed later in Chapter 7 as elements of the forces unpicking affordable housing in large cities. The earlier discussion about private-sector housing in the UK and the recent rises there in house prices and rents argued that market-sector housing is still ‘working’ for those in many income brackets, even though the options of homeownership versus renting have shifted for many. The real losers are some of the households lower down the national income spectrum for whom homeownership was never a realistic prospect anyway as it was totally unaffordable. Rental accommodation is, and was, their only option. Many of the less wealthy in income bands that might previously have managed to buy have now swelled their numbers. Anything that pushes up rents is seriously damaging to their welfare because it is in these households that the opportunity costs of spending more on rent means forgoing food, heat, clothing, school uniforms and so on. Even with the surge in investment in privatesector rented accommodation after the financial crash, rents rose faster than incomes in many cities in the UK as demand increased. Again, the affordability curves have shifted, with more households caught at the sharp end of the housing dilemma where they literally cannot afford to rent decent homes. At the same time, the crucial public-sector interventions of public-sector housing and rent support have seriously dwindled. For many decades, these ameliorated the otherwise inevitable outcomes of outright homelessness or living in slum conditions, but some in these groups are now in serious trouble because the housing dilemma is taking on shades of the situation in the pre-World War Two era. For example, many poor female-headed households in the UK with children who are caught in the housing dilemma are (again) housed in one room with shared amenities. I say ‘again’ because the immediately obvious comparison is with national housing conditions in the nineteenth or early twentieth century. However, a more telling comparison is perhaps 86

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with housing in the cities of the GS and the concept of informality. Since it is illegal for families to be housed in this way in the UK for anything but very limited time periods, their housing can arguably be described as informal. The UK example points to the main parameters that affect urban housing outcomes across most contemporary societies. In trying to evaluate these, and the similarities and differences between the poorer cities and countries of the world and those that are rich, the main analytical strategy needs to be to understand income profiles and levels. These explain the degree to which the housing affordability dilemma exists, not its existence in itself. They explain much about the extent and severity of local outcomes of the affordability problem, such as outright homelessness, informal housing, creeping overcrowding and any notable reverse in wealthier cities and countries to the former inadequate housing conditions of the nineteenth century. For example, in a city such as Dar es Salaam in Tanzania, the majority of the population would be generally regarded as poor and thus simply cannot afford legal, titled, serviced decent housing. However, in a rich city in the GN, where a lower proportion of urban residents are on very low incomes, significant numbers do manage to pay for such housing and those for whom it is simply impossible are usually in the minority.

Variations in owning versus renting in the private sector Localised factors also shape private-sector provision of housing in the formal sector. This is evident, for example, where the hegemony of market forces, a key premise outlined in Chapter 1, holds less sway. In China, for example, the capitalism practised is essentially a form of state capitalism with very significant central and local state intervention to incentivise development of the built environment with regard to both infrastructure and housing. This has created some outcomes in housing production, such as new cities with swathes of unoccupied new housing, which would be impossible in countries where market forces are more predominant. The high variability in the shares of homeownership versus renting in European countries 87

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also points to the importance of local complexities. For example, three-quarters or more of households in countries seemingly as different as Spain, Finland and Hungary own their homes, while only a minority do in Germany and Switzerland. This, perhaps, might be thought to be an indication that the affordability dilemma in urban housing cannot be generalised in the way this book suggests. Yet large cities all have subsidised housing projects or systems, which prove the existence of the dilemma. Where there is a high incidence of renting in GN countries, it is often because of significant state regulation in the rental sector. This is an obvious acknowledgement by the state that market forces alone cannot decently house the urban population. Government policies from the past to address the housing dilemma have also had very significant impacts on contemporary homeownership rates. For example, the massive state interventions in urban housing in the previously communist Soviet Union and European eastern bloc countries prior to the 1990s and the ending of communism, followed by dramatic transfers of public-sector housing to homeownership, mean that many comparisons are not about the workings of housing markets at all but about the recent historical effects of different modes of production and ideologies. These issues are explored in Chapters 5 and 6. Furthermore, the comparative statistics for homeownership and renting in European countries used in nearly all analyses include rural housing. Although this is of little relevance in the UK and North America, some countries in eastern European are now more rural than some in Asia and Africa, and, as in the latter regions, rural homeownership is far more affordable in general so national housing statistics are skewed by this. Demographic trends are also important. Cities with falling or stagnant populations, due to various combinations of below replacement fertility and low or negative net in-migration, are less likely to face new or rising crises in housing affordability (although a pre-existing problem may persist). More demographically vibrant cities have greater need for new housing, as opposed to shuffling people within existing housing. The demographic causation, however, is not one way. New household formation (individuals, couples or families who move out of their parents’ home and enter the housing market in their 88

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own right, for example) is being squeezed across Europe partly because of the housing affordability dilemma (see Chapter 9). Since younger households are more likely to rent, this affects the rental to homeownership ratios over time, pushing up the rate of ownership in cities that are not attracting in-migrants (whether domestic or foreign). The size of the urban housing market in the USA – its extraordinary value was estimated at $31.8 trillion in 201718 – and the global influence of that country’s ideological shifts make the local factors at play there of particular significance. The key issue is undoubtedly the country’s particularly strong adherence to relatively unfettered capitalism, which explains the long-standing prevalence there of the ideological stance noted earlier for nineteenth-century Britain: ‘in the supply of dwellings … facts of quantitative insufficiency are for ordinary commercial enterprise to meet’. Thus, there is a very strong reliance on the private sector to provide urban housing. From the comparative perspective, even when related to capitalist western Europe, the USA has generally exhibited a strong reluctance or refusal to accept that affordable, decent housing for large sections of the urban population cannot arise from ‘ordinary, commercial enterprises’. The USA’s ideological positioning as the bastion of free-market enterprise in the world is evidently key: relatively speaking, among the societies of the GN, it has displayed a particular antipathy towards public expenditure to help poorer members of society. Homeownership is also seen to feed into the values the state wishes to promote, as it is thought to be ‘ideologically conservatizing’.19 There are very strong links between vested capitalist interests involved in urban land and housing and the government (see Chapter 7). While all these issues can be traced through urban housing case studies in many societies across the world, in the USA the depth of commitment to private-sector housing delivery and, within that, to homeownership is particularly striking. This does not mean that the issue of affordability and the housing dilemma have gone unrecognised and have not attracted public policy interventions. Indeed, as the Harvard urban housing scholar Alexander von Hoffman has shown, it is possible to trace various attempts to get poor people decently housed in American cities 89

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over the course of the twentieth century and to relate these to the ideologies and vested interests of the parties in power at the time.20 Nonetheless, the outstanding feature, compared with most other places in the GN (and, to some extent, in the GS as well), is the extraordinary legislative effort made to help the for-profit sector of the housing market, whether it is providing housing for sale or rent. There has been massive state intervention to promote and increase private homeownership to what might be understood as ‘artificial’ levels. In essence, when houses have been built and sold to new owners only because of such interventions, as their owners would not otherwise have been able to afford them, this is not a result of market forces. A significant element of new homeownership in the USA at specific times falls into this category and is thus considered in Chapter 6 in the context of social contracts and housing programmes. This is admittedly a judgement call, since nearly all countries have tax policies, for example relating to the treatment of mortgage interest, that affect house-buying costs, but it does not make sense to say that this means there is no real private-sector housing market worth analysing. The federal nature of the USA adds complexity, as different states can have different policies or attitudes towards the implementation of federal policies. Its geography also makes for difference: the abundance of land around many towns and cities has made housing relatively cheap by European standards during much of these cities’ development, but it has also created the characteristic sprawling suburbs of urban America. The relative lack of mass public transport in most suburbs creates another layer of housing affordability problems for poorer households, again related to the USA’s relative opposition to the provision of public goods that are more often regarded as necessary in Europe, but this is also affected by the lower ‘urban’ population densities and the interaction between the USA’s car culture and the car lobby. As in much of the GN, the formal housing market has worked for many Americans – they had sufficient monetary demand to find somewhere to house themselves in reasonably decent circumstances. Furthermore, the fixation on private-sector-friendly solutions to try to dodge round the housing dilemma and pretend 90

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that, somehow, the USA is different had some positive outcomes for many of those in populations targeted for homeownership during time periods when delivery systems and trends in wage growth ensured that associated long-term repayments were affordable. This is the key to sustainable private-sector housing markets. The fixation became disastrous, however, when the homeownership market ‘system’ adopted a model in which repayments were not affordable over the long term.

Informal-market ‘affordable’ housing Reviews and analyses of housing in the GS often focus on the incidence of ‘slums’ and inadequate housing of various sorts. The large global development agencies such as UN-Habitat and the World Bank publish world and GS regional overviews of urban issues at intervals in which there is significant coverage of housing problems. Various regional development banks provide similar data. Their approach is generally to view informal, unplanned settlements as one of the major problems; one oft-cited UN-Habitat volume was entitled The Challenge of Slums. For decades their views and policy advice have tended to reflect mainstream neoliberal ideas. In 2006, Mike Davis published a still much cited and influential book, Planet of Slums, which also took a dim view of informal housing in the GS, although from a radically different political viewpoint. It described how over a billion people in the cities of the GS were housed in ‘slums’, portraying a ‘vast humanity warehoused in shantytowns and exiled from the formal world economy’, whose residents were characterised as an ‘informal urban proletariat’.21 Explicit connections were made between the global shift to the current neoliberal phase of capitalism and the impoverishment of many urban people across the world via the Structural Adjustment Programmes so common in the 1980s and 1990s. There was a strong emphasis on livelihood issues – the broad picture of how the billion or more residents of these settlements were getting by, what sort of work and incomes they had, their relationship to the formal urban economy and, more broadly, to global drivers of wealth accumulation, and their political power (or lack of it). The book ended by querying whether these 91

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residents can be characterised as having been deemed, by contemporary global economic and political forces, to be surplus to requirements. This was a sobering conclusion. When studies scrutinise informal settlements through the particular prism of the fact that they are where the poor tend to live – which means, by definition, that they tend to focus on poverty – it is reasonable that their analytical emphasis is on how these might be seen as symbolising the deeply negative trends in global labour markets that have been most painfully experienced by the urban poor in parts of the GS. But there are other prisms through which to see many of these settlements. One is that they tend to provide housing that is affordable for people in the lower income bands. This makes them a central element of any analysis of affordable urban housing without in any way denying their manifest faults. Another is a comparative point: in hundreds of thousands of such settlements across the GS, poor people have gained an entry point to the city, which has sometimes been subsequently fully legalised by the state, in a way that is simply not possible for citizens in the GN. Although it is evidently a contentious comparison, in some ways vast numbers of poor citizens of many societies in the GS have thus managed to gain access to more ‘rights to the city’ than their Northern counterparts. Indeed, looked at through yet another prism, if GS governments had been willing or able to maintain the implacable adherence to capitalist property rights and ‘decent’ housing standards that eventually became the norm in GN cities, there would be fewer ‘urban’ people in the world because of the very much more serious lack of affordable housing that would pertain in the absence of such settlements. This would have been a bad outcome for most of their inhabitants (or their forebears), since net in-migration streams that fuel the pace of urbanisation generally represent decision-making that enhances the livelihood chances of the households involved.22 The fundamental differentiating factor has been land tenure. First, in the GN, with its efficiently functioning institutions that assure both private- and public-sector property rights, including land rights, it is difficult to get round the laws and successfully settle on urban or peri-urban land that does not belong to you. The legal institutions work swiftly to maintain these rights. In the GN they are 92

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regarded as sacrosanct for capitalism, although, in reality, unquestioning and implacable support for these rights on the part of the state is only what capitalism prefers, since evidently not all societies have quite such capitalist-compliant institutions as yet, despite most of the world being now broadly capitalist. Squatting in buildings is another matter – this may or may not be tolerated for a while although the general tendency now is for this to be made more difficult. Often the building is unoccupied and may be due for redevelopment anyway. But woe betide a GN squatter who claims the right to keep the land rather than occupy a building. In contrast, many housing areas in and around the cities and towns of the GS started out as squatter settlements occupying land illegally. There are huge disadvantages to this process in the short to medium term for the residents, including lack of services and the threat of eviction. However, rather obviously, if the settlements remain, they have managed to avoid being demolished. The larger they get, the longer they remain and the more established they become, the better their chances of becoming permanent. Mike Davis described this as having de facto tenure. As time passes, very often they are ‘recognised’ and ‘regularised’ by the state – they are granted legal tenure (de jure tenure) and the right to services such as utilities, schools and clinics; they have thus been accepted as part of the city. Indeed, strictly speaking, once they are so recognised their ‘informality’ is debatable, although they may still be described as such by the authorities since they were unplanned and much of the housing may still not comply with bylaws. The second differentiating tenurial issue is particularly common across sub-Saharan Africa but also of relevance in some other societies: the continued existence of pre-capitalist land tenure systems around the edge of many urban centres and, in some cases, throughout much of the town. These do not exist in the urban GN, although indigenous peoples in North America, Australia and New Zealand may control some rural land under these sorts of arrangements. Where ‘customary’ or ‘indigenous’ tenurial arrangements are still extant in and around cities in the urban GS, they have offered a variety of possibilities for affordable housing for urban people for generations – in both private-sector homeownership and the rental sector – possibilities that are not available in the GN. 93

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Again, these housing areas are usually described as informal because they are unplanned and do not conform to either the tenurial or building standards urban authorities require. However, crucially, they are not squatter settlements, unlike their counterparts described above that began as illegal occupations. The regularisation of such settlements therefore faces a very different set of issues. Squatters are often found on public-sector land, since they are more likely to be evicted on private land, so regularising them basically means a transference of land rights from the state to the plotholders. Private landholders may have to be compensated by the state. Either way, the procedures are covered by ‘normal’ capitalist arrangements and institutions whereby land is freely marketable and owners can be identified from records of freehold title. This is not the case around a typical African city where tens or hundreds of thousands of plots may have been occupied under some sort of arrangement with local landholders whose relationship to the land was not defined by capitalist norms. The role of local, non-capitalist relationships to land in providing affordable urban housing in West African cities is so ubiquitous that a classic article on the topic, written by Konadu-Agyemang in 1991, is entitled, ‘Reflections on the absence of squatter settlements in West African cities’.23 Urban residential areas such as these are, in fact, something of a challenge to one of the key premises of this book: the global hegemony of capitalism as the dominant mode of production. However, most authorities and planning systems in African cities do comply with, or at least aspire to, capitalist norms in these respects. Indeed, it is because they do that these settlements are deemed ‘informal’ (i.e. counter to the required, capitalist-determined norms). The challenge is almost an existential one in urban settlements where the vast majority are housed under quite different arrangements with local historical roots and lines of authority that many households recognise as legitimate, or at least as unavoidable, but which are separate from the urban government. The outcomes of these settlements for the main actors – the original users of the land and those seeking affordable housing – are highly variable. The nature of indigenous tenure and associated power structures vary widely, and this influences how any monetary proceeds from conversion of agricultural 94

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land to urban housing plots are divided up. Smallholder farmers may lose land without benefiting if systems allow local traditional authorities to capture all the profits, although the authorities may not always be so venal.24 Similar processes can be traced in parts of peri-urban Asia or where there was ejidos land around Mexican cities, but again the benefits may be unequally distributed.25 There are vigorous debates about the pros and cons of the housing that develops in such circumstances. City authorities may be reluctant to extend services, for example. This compounds problems derived from the fact that, by definition (since the housing is informal), housing standards are not followed and thus the physical quality of the housing is often inadequate (although, of course, that helps make it cheap). Those who believe that formal (capitalist) title26 to land is essential to ensure security for housing investors and to allow a property market to develop are opposed. As there is no central register of transactions relating to land, disputes can occur – and often do. In West African cities, a major scam is simply to sell someone land for a house that the vendor does not own; the purchaser then finds that various other claimants may turn up. This adds another layer to the classic warning, caveat emptor. Nonetheless, extensive research has also shown that full title is not necessary for residents to feel secure where indigenous tenure is perceived as legitimate and if there is no perception that the government is likely to choose to evict.27 In many African countries, the government theoretically controls all land, and this opens up the possibility of indigenous land being taken (although the same is true of registered leasehold land). However, to some extent the sheer scale of the settlements is such that neither the local nor the central government has the capacity to do anything about it, even were they so disposed, which they usually are not. Governments certainly do undertake evictions in major African cities, mainly in well-located areas, causing much misery. However, the vast majority of such housing remains, much of it around the edges of cities. Homeowners may seek to obtain some sort of certification of their occupancy from city officials, as insurance, although often this has little legal validity.28 Plots may also be laid out in straight lines rather than haphazardly. Hybrid or ‘vernacular’ tenurial systems 95

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often gradually develop with some of the characteristics of capitalist property markets.29 From the narrow perspective of assessing the housing that exists rather than what might have been preferable, the key point is that such settlements have provided urban housing that is affordable for millions of people on low incomes. In thousands of African towns and cities, including major capital cities with millions of residents such as Lagos, Dar es Salaam, Dakar, Maputo and Kinshasa, this is how huge numbers – often the majority – of urban people have housed themselves for generations. However, these housing areas are deemed ‘informal’ once the city boundaries expand to include them. When first built, as in squatter settlements, the housing neither complies with city regulations nor is it serviced, further reducing costs. An incremental approach to housing improvements can be adopted and is appropriate for those on low and irregular incomes. Land costs during the transition from farms to housing are much lower than in a capitalist system because the land has not been officially rezoned as urban. Large-scale, formal property developers are therefore not involved. Therefore, whether the profits captured are fairly or unfairly distributed among the original land users, the groups and classes who benefit are local and different from those typical under conventional capitalist tenurial arrangements. They are not capitalist, large-scale and possibly corporate landholders, although in countries where nearly all indigenous land was expropriated under white minority rule, such as South Africa, this is often the case. The original farmers or their descendants may become landlords, renting out housing, but so may early plot-holders who subdivide their own plots as demand rises. For example, in Kenya’s third-largest city, Kisumu, most residential areas have developed and expanded predominantly in line with the processes described above, and many originally rural landholders have become landlords. Most live on plots alongside their tenants, as depicted in Figure 4.2. Some have now registered their landholdings with the city authorities but many do not bother to apply because they do not feel under threat if they do not.30 As noted, housing in such areas rarely conforms to decent standards, but this need not mean that it is necessarily drastically 96

Private-se c tor urb an housing p r o v i s i o n Tenant house (two rooms)

Tenant house (two rooms)

Tenant house (two rooms)

Water standpipe

Tenant house (two rooms)

Mud road

Tenant house (two rooms)

Pit latrine

Tenant house (three rooms)

50m

Landlord house (four rooms)

On-plot electricity connection

Plot boundary

Main electricity line

Figure 4.2  Plot layout in an informal housing area in Kisumu, Kenya: landlord and tenant housing and services Source: Smith, S. 2015. The relationship between housing tenure and service delivery within the low-income settlements of Kenya’s secondary cities: everyday life in relation to the rental economy. PhD thesis, Department of Geography, Royal Holloway, University of London.

inadequate. Conditions are highly variable. Access to services such as piped water and electricity is problematic, and where it exists complicated local arrangements may develop that are influenced by household incomes and local social capital, as suggested in Figure 4.2. Indigenous tenurial systems in cities are also just as liable as capitalist systems to propagate real slums, in their proper sense of overcrowded residential areas with such poor services that people’s health is seriously compromised. As Konadu-Agyemang notes, ‘the absence of essential facilities like water, drains, toilets and the like may … aptly describe some of the slums in West African cities. But [it must be remembered that many of] these slums cannot in any way be described as squatter settlements.’31 The complexity and implications of indigenous, non-capitalist tenure for urbanisation in parts of the GS are not always well understood or represented in urban literature. This is perhaps inevitable given the range of different types of such tenure, each with its own power structures, and the fact that these then interact 97

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with formal market institutions within the city they surround. In turn, these also have their own characteristics, reflecting the history of urban settlement, the nature of the state and, of course, the power of local and foreign formal private-sector interests. In Planet of Slums, for example, indigenous tenure is categorised as one of the types of ‘de facto tenure’ where land is ‘usually state-owned, but settlers have purchased a guarantee of tenure from powerful politicians, tribal leaders, or criminal cartels’.32 Not only does this sort of linking obscure the point that customary tenure is usually legal but there is no further mention of its massive role in lowcost urban housing (although the roles of clientelist politicians and dodgy middlemen are discussed in some detail). However, it may be better to be ignored than to receive the treatment usual in mainstream urban literature, where there is often a presumption that ‘efficient’ capitalist property markets should (and inevitably will) replace indigenous tenurial systems, and that the state needs to impose the conditions required. The executive summary of the 2010 UN-Habitat The State of African Cities report, which had the special theme of ‘Governance, Inequality and Urban Land Markets’, stated: ‘The basic rationale for public policies is to ensure market fluidity through the smooth mainstreaming of customary into formal land markets.’33 Yet the summary also points out that: ‘Informality has taken on such proportions that it has become the norm. Consequently, simply declaring informality “illegal” is no longer an option.’ Furthermore, in a later section on central Africa, any presumed superiority of formal markets is challenged when it is argued that, ‘[r]ather than stigmatising informality, public authorities should review the arrangements and mechanisms prevailing in informal urban land markets. Formal markets have much to learn from the sheer cost effectiveness and expediency that informal urban land transactions offer.’ In several places the housing dilemma is also recognised, most simply when it is accepted that ‘[m]ost African households cannot afford formal urban land ownership’.34 The obvious implications of this for the majority should the recommendation for customary land to be ‘mainstreamed’ into formal land markets be implemented is not, however, addressed.

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Poor housing or outright slum conditions can emerge where ways of gaining access to urban land and housing are informal, just as they can when housing is managed and delivered by a formal private sector, if standards are not regulated. Where there is very strong demand from the urban poor for housing in particular parts of the city, in either the formal or informal private sector, the profit motive can generate high rents, poor conditions and overcrowding. Discrimination against particular groups can also push them into poor accommodation as some venal lessors take advantage of the constraints they face when seeking access to housing. The historical experience of the GN and the contemporary experience of many of the cities of the GS demonstrate that the development of real slum conditions can occur on urban land under any type of tenure. The geography of city slums today, whereby they are mainly found in the GS, is not due to any inherent characteristics of these regions – slums exist here for the same reasons they used to exist in the GN: first, the widespread incidence of households with very low incomes; second, very high demand for cheap housing in areas reasonably well located for employment opportunities; and third, in relation to public policy responses, a lack of political will or economic capacity, and often both, to address the slum conditions that arise and implement regulations to prevent them emerging and to subsidise the provision of housing that is affordable for low-income groups. Fortunately, there has been a wide range of policy measures that have developed across the world at various times to assist in the provision of decent housing that is affordable for those on low incomes. These are the topics of the next two chapters, which look first at rental housing and then at homeownership.

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Chapter 5

Squaring the circle: social housing programmes and affordable rents

Introduction A central premise of this book is that there are always hundreds of millions of urban jobs under a market system which will pay workers far less than is needed for them to house themselves adequately under that same market system. The only thing that can square this circle is to buck the market. The historically tested remedy has been to provide social housing at scale with state subsidies. This approach is contested today in many parts of the world, mainly because it is so antithetical to the neoliberal ‘norms’ that now predominate. For adherents to those norms, it is an ideologically uncomfortable solution. It demonstrates the fundamental contradiction at the heart of the housing dilemma: that is, the mismatch between many people’s incomes and housing costs. This is not something most governments wish to publicise because it knocks such a giant hole in their (real or assumed) faith in markets. It means that there is a fundamental market failure. One definition of ‘market failure’ is where the operation of market forces leads to a net social welfare loss. This is ‘economics speak’ but it describes the situation in Global South (GS) cities where informal, unplanned housing has emerged with very poor or no services or where outright slums have developed. As explained 100

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in the previous chapter, that housing is very often the outcome of unregulated market forces that may be able to deliver housing affordable to the poor, but it is often problematic and sometimes downright dangerous for the residents’ social welfare. In regulated housing markets where planned, legal and ‘decent’ housing is produced, there is a so-called ‘partial’ market failure whereby the market produces either the wrong quantity of a product or at the wrong price. In cities throughout the world, the price is the problem. Economics textbooks list various reasons why markets might ‘fail’. Some are the sorts of reasons that housing policymakers and property developers publicise – lack of information, ‘over-regulation’ or institutional weaknesses. However, housing actors with vested interests in market provision of urban housing tend to avoid noting that other textbook reasons include that the private sector cannot profitably supply to consumers pure public goods and quasi-public goods that are needed to meet people’s needs and wants. Two issues already discussed in relation to the housing dilemma are highlighted here: that formal market providers cannot produce housing for millions of low-income people because it cannot be profitable; and that housing is best understood as a quasi-public good because it is a basic need. These reasons focus on supply, but another reason for market failure addresses the housing dilemma from the demand end of the equation. This is when markets generate an ‘unacceptable’ distribution of income that leads to social exclusion, which the government may choose to change. Being excluded from ‘decent’ and legal housing is about as obvious a form of social exclusion as can be imagined. Evidently these sorts of explanations of market failure are laden with social values about the importance of people’s welfare. They are therefore ideological. Decision-makers and investors who are strongly wedded to the neoliberal ideological norms that markets must be the best and most efficient providers of goods and services often choose not to accept these ‘market failure’ aspects of urban housing provision as this is intellectually discomforting. More importantly, for investors in the provision of private-sector housing, agreeing that the logical next step is that public provision is required for many could undermine the scale of the profits to 101

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be made. Instead, both the public- and private-sector actors wedded to ‘free’-market solutions tend to engage in a messy range of partnerships so that the private sector can make profits by providing some of the ‘unprofitable’ housing via a subsidy from the state. The most obvious way of addressing the market failure issue, in countries that can afford this, is simpler: the public sector builds low-income housing and rents it at rates commensurate with the lower bands of local incomes. Governments may also allow gradual purchase of such housing stock through arrangements such as ‘rent to buy’, or the purchase of older stock at highly subsidised rates, although this has the serious downside of reducing the public housing stock available to meet poor people’s needs. The more complicated routes include rent controls in the private sector or various types of publicly funded benefits, grants or vouchers paid to poor households to allow them, in turn, to pay market prices for renting or buying housing. However, probably the most important route – and one that has been of such fundamental significance in many cities of the GS – has been to legitimise informal housing. With ‘legal’, officially recognised tenure, and the services that then tend to develop, such housing is often upgraded and the recognised plot-owners can enter into official housing market transactions. All of these policies achieve the aim of formally housing urban residents who do not command sufficient cash incomes to ‘buy’ legal, planned housing in the marketplace. There are thus many ways of squaring the circle. However, their implications for government budgets, for capitalists involved in housing and for residents can be very different. Given that large city land and property markets account for such a significant proportion of the world’s assets as currently valued,1 intervening in these markets always has enormous opportunity costs. A useful test of the success of a low-income housing policy that involves mass public investment is to follow the money: who is benefiting most from that policy and who owns the housing assets? Is it low-income households, or the government, or the private sector? If it is the private sector, is it large-scale companies and developers or small-scale builders or lessors? It may well be a mixture, but when mass public-sector subsidies are involved, policies that mainly deliver decent, affordable rental housing to poor households and/or create 102

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and maintain housing assets in the public sector, or transfer housing assets to the poor, are far more sustainable for governments and fairer for taxpayers than policies that lean towards bolstering the assets of a narrow range of private-sector housing stakeholders. It might be argued that any government subsidy which involves private-sector housing stakeholders self-evidently bolsters their profits, inasmuch as they can now profitably provide ‘decent’ housing for rent or purchase to groups who would not otherwise have been able to afford it. This is true. However, some policy outcomes are more egregiously unfair for governments, taxpayers and the poor than others. The Help to Buy scheme in the UK, for example, which will be discussed in Chapter 8, was characterised in 2019 as the ‘crack cocaine of the building industry’.2 It is very widely recognised in both academic circles and government treasury departments that the housing dilemma means that governments are subsidising capitalism to quite astonishing extents. Some subsidies are more obvious to citizens, economists, employers and lessors than others. These different approaches to ‘squaring the circle’ and fixing broken cities are discussed in this chapter and the next, and are illustrated with examples from different parts of the urban world. Although the approaches tend to determine the balance of benefits between those involved, local contexts and political landscapes provide layers of complexity that can reshape outcomes, sometimes in surprising ways. This chapter deals with interventions in rental housing and the next with policies that subsidise or otherwise allow for widespread homeownership. The boundaries between these categories are, however, often porous and one type frequently segues into another over time or is practised within the same urban space.

Matching the gap between low incomes and market rents Public housing with affordable rents

Outside the former communist countries, the world’s oldest capitalist society – the UK – had the most far-reaching public-sector rental housing programmes. Its experience thus provides a guide 103

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to the general principles and debates about this way of ‘squaring the circle’. Chapter 4 showed how disquiet about dreadful housing conditions in Britain’s cities led to slum clearances at the end of the nineteenth century but generally tended to shift slum dwellers to other poor housing, since far too little new decent housing at rents they could afford was built to replace the slums. It took decades for this nettle to be firmly grasped when a Labour government, after World War Two, began mass public provision of urban housing at affordable rents. In the interim, piecemeal initiatives developed that helped some and showed what was possible. Some were funded by private philanthropists, so were not public housing per se. They usually operate today as charities. Examples include the remarkable ‘decent’ inner-city rental tenements built by the Peabody and Guinness Trusts, which began building in the 1860s and 1890s respectively. There is still the solid evidence of this phenomenon in places such as London’s Westminster, Covent Garden and London Bridge, where one Guinness estate is now overlooked from within a couple of hundred yards by that testament to modernity and global property development in the world’s great financial cities, the Shard skyscraper. In 2018, Peabody housed around 70,000 people and Guinness 120,000. Local government (council) housing was made possible by the Housing of the Working Classes Act of 1890 but was limited in quantity and quality. Up until 1919, provision was often of poor-quality high-density tenements, so some became subject to slum clearance after World War Two. A notable exception was London County Council’s first housing estate at Boundary Street – one of the world’s oldest local government housing schemes – which started in 1893, replaced part of the Old Nichol slum and housed 5,100.3 It is a salutary reminder that hoped-for privatesector participation in this scheme never occurred as it was not seen as a profitable investment. It remains as yet largely in the public sector in contemporary Tower Hamlets. Nonetheless, as was typical of the time, those evicted from the slum it replaced could not afford the rents and were displaced to other slums further east. Only 11 Old Nichol residents ended up in Boundary Street. To operate at the scale required, council housing needed central government financial support. This was finally made possible 104

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with the passing of the 1919 Addison Act. There was an effort to provide housing for ex-soldiers: ‘Homes for Heroes’. This created, for example, what was then the world’s largest council housing estate at Becontree, Dagenham, on London’s fringes. It housed over 100,000 people by 1932 and complied with ‘decent’ standards. However, although this sort of housing did begin to tackle the housing dilemma on the upper edges of the income bands for which decent, private-sector housing would have been unaffordable, rents were generally too high for those in the lowest bands. The more skilled, better and regularly paid working classes remained the target beneficiaries, leaving millions still firmly stuck in the housing dilemma.4 The Depression in the 1930s curtailed government spending and the central government forced local councils to focus on slum clearances again. The shift to providing decent housing for most was one of stops and starts. Finally, after World War Two there was the political will, with a newly elected and radical Labour government in power and an electorate determined to forge a new social contract with employers, to build mass public housing at scale with rent policies which would ensure that most people could be ‘decently’ housed at last. Britain’s urban housing situation was truly transformed by the simple expedient of abandoning all pretence that the market sector would or could do the job. The state built hundreds of thousands of dwelling units. As shown in Figure 4.1 in the previous chapter, up until the end of the 1950s public housing completions exceeded those in the private sector. Nearly a quarter of a million were built in 1953 alone. However, the provision of public housing that meets decent standards does not solve the housing dilemma. It only tackles a supply issue. The crucial step is the principle that the rents set for that housing take account of the market-set pay levels of the poorer income groups. Only that can tackle the issue of ‘demand’ that is at the heart of the problem. Rents for UK council housing essentially ignored the market for housing for decades but accounted for the effects of market forces on incomes. Rents were thus set at prices that the lower bands of the income range could afford. Typical pay levels for manual labour work were taken into account; even today this remains the case although various market factors are 105

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also part of the equation.5 For decades, the principles behind this system were broadly accepted in the UK. Council housing rented according to these principles continued to be built in large numbers up until the end of the 1970s. Dangerously bad and overcrowded housing conditions, particularly for families with children, did not vanish but they became less and less the norm for poorer groups. Many mistakes were made relating, for example, to the geography and architecture of housing estates, in part due to overly zealous efforts to reduce land and building costs. Nonetheless, the housing dilemma was steadily dwindling in the country where capitalism and the Industrial Revolution had been invented and where the related shift to a mainly urban and proletarianised population had created the conditions for broken cities characterised by appalling, overcrowded and dangerously unhealthy housing because that was all many could afford. In 1979 this situation changed. By then, 42% of people in the UK lived in council housing.6 But global ideologies were changing. A return to the liberal political economic beliefs of the nineteenth century emerged in the UK and USA: neoliberalism was born. The role of the state in mediating the worst market failures in terms of welfare outcomes for many ordinary, working people was no longer seen as self-evident; instead, its role was recast as enabling capitalist accumulation. For low-income housing in cities of both the Global North (GN) and the GS, this was a regression. Inevitably it began, slowly but surely, to reinvent the very supply-side market conditions in housing that, in the UK, mass provision of council housing had finally addressed. Equally inevitably, this meant that the UK’s housing dilemma started creeping back. The provision of public-sector housing for low-income groups at rents commensurate with what they could afford (public rental housing (PRH)) became an important part of the housing mix in the GN, particularly after World War Two. There were differences between countries but the approach generally transformed the fundamentals of the housing dilemma. In the USA, a powerful ideological commitment to market solutions meant that far smaller shares of the population were thus housed, and, if policies to help house the poorest were reluctantly deemed politically unavoidable, 106

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solutions which included private-sector profit-making alongside government subsidy were preferred. In the late 1960s to early 1970s, the peak years of public housing provision in the USA, only around 50,000 to 80,000 units were started per year. On a pro rata basis, given their relative populations, had it matched UK output about ten times as many would have been built. In any case, as in the UK, since the 1980s the numbers have been ‘insignificant’7 as ‘there has been no large scale funding for new public housing at the federal level’.8 Instead, the USA’s Section 8 programme subsidises the private sector (including non-profit enterprises) to build and rent housing to lower-income groups and ‘vouchers’ are provided to tenants to top up their rents. From 1974 to the end of the 1980s, 665,000 homes were built and 1.1 million other households received subsidised housing finance under this programme, which exceeded the total number in public housing.9 The USA’s rental housing policies have usually involved explicit recognition that housing affordability is about households not paying more than a reasonable share of their income in rent, as recommended by housing research generally, thus giving them a chance to pay for other essentials. In PRH this used to be 25% of income, increased to 30% in 1981. For the Section 8 programme, households also pay a maximum of 30% of their income and the rest of the rent is covered by the vouchers.10 In communist eastern Europe and the USSR, of course, nearly everyone was in ‘public’ housing because private property was nationalised. People were redistributed among the housing available and any new state housing built. The issue of segmented housing markets and the housing dilemma did not pertain. There were housing problems, but they were not about affordability – rents (and energy bills, which are a crucial element of housing costs in cold countries) were usually cheap and often very cheap, which significantly reduced income inequality.11 In the USSR, the propiska system, which was part of the state’s controls on migration, was tied up with a constitutional right to be provided with a dwelling in the area of registration, the significant downside of which was that it made it difficult to find legal housing if you moved. In these circumstances, supply-side factors did make a difference. If the state did not build more apartment blocks in the cities where populations 107

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were growing, the existing housing grew increasingly overcrowded. Overcrowded urban accommodation was typical in Russia until after World War Two, when significant amounts of new housing was built. This could recreate aspects of the problems of inadequate housing more generally, particularly in terms of privacy, dignity and family life. However, after the end of communism, market forces began to affect urban housing outcomes and features of the housing dilemma typical of capitalist countries began to appear, although the sheer scale of public housing in these countries tempers these outcomes. On the other hand, eastern European countries tend still to have far more overcrowding in their housing stock than in the rest of Europe.12 Local housing histories are always an influence on contemporary housing patterns. Subsidised public housing was also an element of colonial urban policies in Asia and Africa, albeit the priorities involved were anything but progressive. Most of the expanding urban workforce was usually left to house themselves in an unregulated private sector or by squatting, sowing the seeds for many of the subsequent housing problems faced by independent governments. However, where and how colonial civil servants – mainly white Europeans but also including some local staff – were housed were issues with implications for the image and status of colonial authority. Since pay scales would not have allowed these public servants to pay realistic rents, housing was often a ‘perk’, with rents set far below market rates, if they were charged at all. The colonial governments covered the costs. At independence the new national governments found that nearly all the public housing budget was tied up in covering these costs for housing that public servants regarded as the norm for the job. This proved politically difficult to undo. In any case, reducing the housing subsidies would have required increasing public-sector pay to cover the real rents, were ‘decent’ housing still to be occupied. In Zambia, for example, this meant that from 1978 to 1987, many years after independence in 1964, most of the government’s housing budget was still subsidising public-sector employees’ housing, with only 8% set aside for low-income schemes.13 As the example of colonial interventions suggests, the ‘welfare state’ approach of low rents in public housing to address the housing 108

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dilemma gives governments power to effect outcomes additional to affordability. These can, unfortunately, be very negative. They can then lead to misguided perceptions that public housing per se causes the problems. Those opposed to the redistributional values underpinning such policies may do what they can to strengthen such misunderstandings. Much depends on the political ideology and social attitudes towards poorer urban citizens of the party in control of the government. Even before the advent of neoliberalism, in the GN’s capitalist societies it was possible to trace the impact of the election of conservative, more pro-market parties on public housing policies. Less money would be made available and the quality of any new-build housing and its location would be more disadvantageous for the residents’ health, comfort and ‘right to the city’, such as the ability to engage with job markets and urban social and community life. Social engineering to use public housing to segregate by other socioeconomic characteristics besides low incomes could be attempted. This allowed political parties that embraced values which were intolerant towards, and discriminated against, some population groups to disadvantage their poorer members using housing as a vehicle. Examples include marginalising them geographically in peripheral housing schemes,14 discouraging the social heterogeneity which is the lifeblood of liveable cities, and choosing not to fund properly the associated social infrastructure all residential areas need. Race is the obvious factor that has often been used, especially in the USA,15 but others include religion, household composition (for example, single-parent households) and ethnicity. The principles behind this approach were under attack almost as soon as they were established. However, the sheer scale of provision in the first post-war decades, the continuation of low rents in such housing and the establishment of social norms for ‘decent’ housing that were now embedded in legislation established a bulwark against any swift overturning of the impact of public rental housing on the affordability issue. A general cross-party commitment to maintaining the planned, ‘orderly’ and legally tenured setting of cities in the GN, now that most ‘slums’ and informality had been ended, also mitigated strongly against wholesale abandonment of public-sector 109

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housing as this was bound to lead to squatting and other ‘problems’ by now associated by GN societies with the cities of the GS. There were image issues to consider, and, in capitalist societies, property values. Changes tended to be incremental, but over decades they began to reinvent the housing dilemma in the GN. Large-scale public-sector rental housing programmes have thus had a complicated history. Their capacity to be used as an element of (negative) state social engineering is problematic. Yet, even if this is or was a priority in their inception, the fundamental requirement to be truly affordable may lay the foundations for advantageous change for some in the long run. The interplay between the housing dilemma and attempts to realise state control have been playing out for generations in the formal townships of the formerly white minority states of southern Africa. This example is considered in some detail in the following section because it helps demonstrate the ubiquity of common structural elements underpinning policies to ‘square the circle’ of unaffordable housing. It thus also serves as a reminder of the importance of shifting urban analytical frameworks away from presumptions about binary divisions between processes in the GN and the GS. Southern Africa: squaring the circle as a political imperative

As has already been established, colonial regimes often assisted civil servants and some public-sector workers with their housing but most other urban residents had to house themselves via private-sector provision, frequently informally. Generally speaking, colonial objectives precluded much investment in the welfare of local subjects. However, in the urban context, this also meant ceding control over many aspects of the urban built environment and urban populations. In the three countries in southern Africa ruled by white minority regimes for much of the twentieth century, however, the retention of political control by local white electorates trumped other objectives. Racist and discriminatory policies were practised (formalised in South Africa from 1948 as ‘apartheid’). However, their governments also invested very significantly in affordable

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public housing projects for their low-income, ‘non-white’ urban populations (categorised in apartheid South Africa as Africans, Asians and Coloureds). As a result, the emergence of widespread unplanned and illegal housing ‘solutions’ around ‘white’ cities was controlled for many decades. The housing patterns in these cities were very different from those in most of the rest of the GS, therefore. Most Africans were housed in planned, legal residential areas which had water and sanitation systems (electricity sometimes came later), schools, clinics and public transport. Why was this? The main motivations were very negative – it was about political and economic control not only of the urban-located workers who were needed for the economies to ‘work’ but also of millions of rural Africans who accounted for the majority of these countries’ populations. Many had been forcibly dispossessed of their land, and nearly all were living in poverty, often in very overcrowded ‘reserves’. This set the scene for mass rural–urban migration and informal urban housing solutions. However, the economic and political imperatives of the white governments and their electorates would have been catastrophically undermined by such developments. So strict controls on migration – influx controls – were key elements of the laws that maintained white minority rule. Most Africans in urban areas had only temporary rights to be there, dependent on their work contracts. Restrictions on who could live and work in cities, and for how long, had economic advantages for the state and white employers as most of the costs of the reproduction of labour – childhood, family life, education, old age, illness, and indeed urban family housing – were largely avoided. Instead they were borne by the rural African poor. However, the political issues were more crucial. It was predicted, correctly, that a mainly and permanently urbanised, fully proletarianised African population would speed up the political struggles by the disenfranchised majority and lead to the emergence of urban-based political demands that eventually could not be contained. That would mean the end of white minority rule and its associated privileged lifestyles. The curious paradox of the ‘formal’ public-sector townships in these southern African countries was therefore that they were

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more about strictly controlling internal migration than delivering formal, serviced urban family housing. However, it turned out that you could not achieve the first without the second. The informal settlements around cities in other regions of the GS had the advantage (for the state and employers), at least at first, of being a financially cheap solution to the housing dilemma. Nonetheless, it was difficult to control who lived in such urban areas or their economic activities, and, over time, they often became politically organised and started to make demands. These were among the sorts of things that apartheid aimed to prevent. Hence the townships. Where possible, African workers were housed in hostels: one bunk per ‘single’ and almost invariably male migrant worker who (at least in theory) oscillated between periods of work in the city or contract work in the mines and rural ‘homes’. The hostels associated with the mining industry since the nineteenth century in cities such as Johannesburg were notorious examples. Nonetheless, some longer-term and more skilled workers were essential for the economy and families with long histories in the cities were already in existence. By providing housing, and getting rid of most of the unplanned alternatives that had previously emerged, the state had control over allocation and could determine not only the characteristics of residents but their numbers. It also obviously assured racial residential segregation – a key objective of apartheid. In South Africa, the main townships for Africans, Asians and Coloureds began to be built in the 1950s. The system was backed up by increasingly elaborate controls on African migration. However, the township policies were immediately faced with the housing dilemma. The potential African residents were formalsector workers (and their immediate families) as informal work was largely banned. Yet most were too badly paid to pay economic rents that would yield a profit. The same was true for many Coloured and Asian workers. So although the townships were often built, at a profit, for the state by large-scale private-sector builders,16 they had to be run by local or central government and rents had to be significantly subsidised. There was no point in achieving control via the allocation of housing if residents would swiftly have to be evicted for

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rent arrears. Homeownership, with its connotations of permanence and citizenship, was forbidden for urban Africans. The houses were simple one-storey buildings, with two or three bedrooms, and usually with outside toilets and water points. Nonetheless, that crucial infrastructure was sufficient to prevent the water and sanitation problems of so many informal settlements. Many houses were detached and had a fair amount of space around them (which later proved of huge significance in terms of another regional housing ‘solution’: the ‘backyard shack’). The roll call of typical townships in the cities of white minorityruled southern Africa came to be typified as places of poverty, poor conditions and even of despair. Their peripheral locations were planned and deliberate – another feature of political control – places such as Soweto (South Western Townships) south of Johannesburg; Highfields and Harari (after which contemporary Harare was named) in the south-west of Salisbury in Southern Rhodesia (Zimbabwe); and Katutura (meaning ‘a place where we do not stay’) in Windhoek in South West Africa (Namibia). In South Africa, in particular, they also came to be associated with violence, as the struggle there against apartheid was primarily played out in the townships. These associations understandably make it difficult to assess these huge housing projects comparatively. Nonetheless, despite their negative aims, they did (and still do) represent a massive state intervention to house poorly paid urban workers in affordable, formal housing. In both South Africa and Southern Rhodesia these policies in the largest metropolitan areas lasted less than 20 years. Subsequent state-sponsored townships were pushed much further away than the edge of cities, preferably to African ‘rural’ areas under African political authorities. In South Africa, ‘rural slums’ often swiftly developed around the edges of these distant, formal townships. These ‘dumping grounds’ were truly places of despair, chronicled by the academic and advocacy group of the Surplus People Project.17 Many were standalone areas, displaced from any proper urban settlement. Many squatter settlements around cities once again emerged when political struggles made influx controls increasingly

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difficult to implement. By comparison with these areas or the more distant ‘dumping grounds’, the original townships relatively close to ‘white’ cities were far preferable. And, once apartheid ended, it gradually became apparent that the migrants who had been housed there were now advantaged in many ways. But the timing of in-migration was crucial. In 1997 the vast majority of household heads in Soweto who had arrived in Johannesburg before 1955 and over two-fifths of those who had arrived between 1955 and 1965 were in formal township family houses. Yet only 14% of post-1965 arrivals were in such housing; the majority were in informal settlements, backyard shacks located around the edge of formal township housing plots, and hostels18 – many of which had gradually shifted to become fantastically overcrowded ‘family’ accommodation, characterised in one study as ‘A Bed Called Home’.19 Access to a township ‘matchbox’ house was now hugely advantageous. Most of these houses now belonged to their main occupier (the result of another policy considered later in this chapter), they were serviced, and rents could be charged to backyard shack dwellers. The history of PRH in southern African countries illustrates how the state can use public housing for negative ends but also that this still requires making that housing affordable with subsidies. It also shows that the benefits of affordable public rental housing are such that they can reassert themselves when political systems change. Links between the housing fortunes of poor households and timing in relation to changes in government housing policies are mirrored across the world. This is to be expected. It can partly obscure the housing dilemma if the numbers of ‘beneficiaries’ of previous, but now dismantled, policies that delivered affordable housing (no matter what the underlying motivations were) are still very large. In these circumstances, understanding the nature of the urban housing dilemma requires cohort analysis of the sort undertaken to describe the problems in Johannesburg in 1997. This is not easy. The key question that needs to be addressed is what is the likelihood of newly formed, low-income households getting access to truly affordable, public (or subsidised) housing in urban locations where there are jobs or good transport to places where work can be found. 114

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The link with urban economic opportunities – with economic geographies – is also a crucial one for public housing programmes. Governments that choose to provide affordable housing in crazy places are not tackling the urban housing dilemma. In some cases, as in the later, increasingly distant townships of apartheid South Africa, the subsequent social and economic exclusion of the residents – the denial of their right to the city – was deliberate; in others it may be more a result of public-sector cost-cutting and lack of vision. In Glasgow, Scotland, in the 1950s, hundreds of thousands of inner-city residents in very poor housing conditions were rehoused in peripheral public housing estates which were meant to improve people’s lives. However, a ‘lack of resources, powers and planning skills’ created a miserable combination of shoddy building design in a cold, damp climate, serious lack of local amenities and very poor transport links back into town. The ‘promised employment opportunities within the estates failed to materialise for the majority of people’, with 40% unemployment rates in some estates, and ‘infrequent and relatively expensive bus services from each estate to the city centre … [meant that] those who made it into the city faced a race to be finished in time for the last bus back’.20 These made the new estates highly problematic places to live, albeit affordable. The motivations behind these schemes were broadly positive, but, for the households displaced, the serious disadvantages they faced were determinant for their long-term livelihoods and quality of life, no matter what the niceties of the politics involved. Tackling unaffordable private-market rents

There are many other ways in which governments can address the housing dilemma besides building public rental housing with rents affordable for those on low pay. In the private rental sector (PRS), this means controlling and reducing rents to levels lower than market rates or topping up low-paid workers’ incomes to match the gap between market (or controlled) rents and what they can afford. Both policies may be pursued in tandem. The question of the ‘decency’ of such accommodation, which is argued here to be such a crucial 115

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element of the nature of the housing dilemma and a common differentiator between urban housing characteristics in the GN and the GS, may then be covered by other regulations. Regulating rents and tenure conditions

In places where the urban rental market is formal and regulations about the ‘decency’ of accommodation are at least partially upheld, there are usually two sets of diametrically opposed analyses of interventions in the PRS. This is partly because the interests of the two parties involved – the lessors and the tenants – are so at odds. The first wants the highest rent possible given the local market situation. There is also a strong monetary incentive to minimise outgoings on maintenance, although this is a tricky balance. Professional landlords (corporate or small-scale) who do not occupy the rented homes logically need to maintain the value of their property asset by maintaining its structural integrity and preventing water damage. However, they may not be very ‘professional’ even in these respects. Landlords, like anyone else, can be incompetent. Other aspects of decent housing standards, ticking the sorts of boxes outlined in the UK’s Decent Homes legislation for public housing, about space, safety, damp and cold and the myriad material elements of a residence that can make it a ‘home’ are frequently largely dependent on the lessor’s sense of responsibility. As noted in Chapter 3, UK local authorities have limited powers over many types of physical conditions in the PRS; their intervention is often discretionary and they are told to rely mainly on exhortation, rather than enforcement. Greedy, irresponsible lessors can obviously choose to provide as little as possible, as cheaply as possible, and to fix things as infrequently as possible, in order to increase their profits. Most may not be that bad but very many are not particularly good either. Landlords and landladies living in the same house as their lodgers have an incentive to maintain reasonable conditions simply because their lives are also affected. They can, however, impose a myriad of daily constraints, humiliations and impositions on lodgers’ privacy which may be due to a desire to keep costs down (for example, use of heating and hot water). These may also reflect the more general 116

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social and psychological aspects of sharing living space with others (even when they are your own family!) which are outside the remit of policy. Nonetheless, the power is all on the side of the lessor. Tenants, on the other hand, obviously want their rent to be as low as possible, thereby increasing their disposable income. They also want, and need, safe and decent housing. High rents relative to incomes and poor housing conditions can undermine people’s health in very serious ways. There are important material differences in the depth of discomfort and how immediately dangerous are the illnesses that can result between cities in the GN and the GS. Serious malnutrition or diarrhoeal diseases from dirty water are far more common outcomes in informal settlements in the GS, for example. However, the structural issues are similar: the very powerful position of landlords relative to tenants and their tendency to seek the highest rent the market will bear. Landlords living on-site in informal settlements may face material deprivations themselves from lack of adequate infrastructure. Nonetheless, they may seek to reduce costs or increase their own relative comfort by limiting or charging for tenants’ access to water, toilets and electricity. In low-income informal settlements in Kisumu, Kenya, many tenants in shacks around the edge of the plots of their landlords and landladies face these sorts of problems. Complicated deals to get access to these services from other plots and landlords have emerged for some but everything means more expenditure and thus less income for necessities such as food, transport and medicine.21 Similar issues have been found in formal, low-income, high-density residential areas around Harare, with tenants unable to use sanitation and piped water facilities for most of the day even though it is ‘available’ on-site.22 Highly exploitative conditions for renters in many of Nairobi’s slums and formal low-income projects are common.23 In that city, notoriously, politicians and other elites are among the landlords involved, although they are careful to keep this under wraps.24 The parallels with the efforts to hide the identities of British elites profiting from rents in the appalling Old Nicol in the nineteenth century are obvious. Tenants on very tight budgets often struggle to pay their rents on time as different basic needs compete each week for their incomes, which may also be irregular. Novels about ordinary people living in 117

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large cities across the world and throughout history are replete with references to struggles to keep enough aside to pay the rent (often by a woman in the face of competing claims by a male household head), desperate efforts to evade the rent collector and one-sided negotiations with landlords (see Box 5.1). The fear of eviction hovers over the lives of poor people who rent in the private sector. It can prevent their houses or rooms becoming homes because a home is associated with a sense of security, of safety, of permanence. This is hard to achieve when income-related forced movement between residences is frequent or threatened. The issue looms large among low-income renters across the world. It happens in Nairobi and Mumbai, in London and New York.25 Frank McCourt’s autobiographical story Angela’s Ashes charts his family’s desperate struggles in urban Ireland in the mid-twentieth century.26 Matthew Desmond’s 2017 Pulitzer Prize-winning book Evicted: Poverty and Profit in the American City27 evidenced how common the threat and worries of eviction have become again in the contemporary USA. Roger Altman, a former US Secretary of State to the Treasury, commented that, until reading this book: ‘I thought I had a sense of the breakdown and despair in America’s poorest communities. I didn’t.’28 In American cities with over 200,000 people, it has been estimated that one in seven children born in 1998–2000 would have experienced eviction by the time they reached the age of 15.29 Much of the literature on housing evictions is on mass evictions of communities in both formal and informal low-income housing areas across the world. Often, the underlying motive is to clear high-value land for property development which will yield massive profits for new investors. The everyday moving out and moving on of individual renting households unable either to pay their rent or to renew at the end of a short tenancy, or displaced by other tenants deemed better or more profitable, is less dramatic visually and much harder to address through collective social activism, so is less ‘newsworthy’. In any one year, however, more households are probably disrupted from their housing worldwide in this way than through the more publicised larger evictions. As noted for Nairobi’s largest slum, Kibera, by the early 1980s one ‘impact of commercialization [was] that for the tenants or ex-potential squatters the problem has 118

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moved from insecurity from mass demolition by the state of an entire settlement to insecurity from individual eviction by landlords for failing to pay the rent’.30

Box 5.1 Landlords’ intermediaries: rent collectors and evictions Poor tenants threatened with eviction tend to fear the rent collector, for obvious reasons. Yet the real power (and blame for heartless decisions) lies with absentee landlords, as demonstrated by the following passages from Dickens’ Little Dorrit for nineteenth-century London and McCourt’s Angela’s Ashes for Limerick in the 1930s. ∗∗∗ ‘What I must have of Bleeding Heart Yard,’ said Pancks [the rent collector] … ‘is my bond … Pay up, or produce your property!’ That’s the watchword down the Yard. Throughout the remainder of the day, Bleeding Heart Yard was in consternation, as the grim Pancks cruised in it; haranguing the inhabitants on their backslidings in respect of payment, demanding his bond, breathing notices to quit and executions, running down defaulters, sending a swell of terror on before him, and leaving it in his wake … [However, though Pancks’ employer] looked so good and benevolent that people called him ‘The Patriarch’, … he was at heart a genuine skinflint, for whose meanness Pancks got all the credit … [Later that day] the Patriarch … that firstrate humbug … was saying …: ‘A very bad day’s work, Pancks, very bad day’s work. It seems to me, sir, and I must insist on making this observation forcibly in justice to myself, that you ought to have got much more money, much more money.’ ∗∗∗ The rent man is losing his patience. He tells Mam, Four weeks behind you are, missus … I’ll be back next week and if (continued) 119

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(continued) you don’t have the money, one pound eight shillings and sixpence total, ‘tis out on the pavement you’ll be with the skies dripping on your furniture … Mam … sits by the fire wondering where in God’s name she’ll get the money for a week’s rent never mind the arrears. She’d love a cup of tea but there’s no way of boiling the water till Malachy pulls a loose board off the wall … [A week later the rent man says] I want to know where that wall is and what ye did with the room, so I do … Dear God in heaven, … this is goin’ beyond the beyonds … Out, missus, I’m puttin’ ye out … This has to stop for I have to go back to the office and report to Sir Vincent Nash that the McCourts are a month behind. Where am I then, missus? Out on my arse, jobless and a mother to support that’s ninety-two and a daily communicant in the Franciscan church. The rent man collects the rents, missus, or he loses the job. Sources: Dickens, Charles, 1857. Little Dorrit. London: Bradbury and Evans; McCourt, F., 1997. Angela’s Ashes. London: Flamingo, pp. 320–2.

Tenants need secure tenancies where they cannot be evicted in random ways or suddenly. Without this, home-making and becoming part of a community become even more difficult. For families with children or other vulnerable members, and elderly people, this is particularly crucial and also essential for the social and cultural welfare of the city itself. But this again can conflict with the vested interests of private owners of rented accommodation. Shortterm tenancies may allow more regular rent rises to be imposed on new tenants. Also, the constant threat of ending a tenancy is often enough to keep renters from negotiating for much-needed maintenance, even when the material conditions of their housing are in breach of local laws. Of course, in unplanned settlements in the GS such laws may not exist, leaving renters reliant on negotiations in 120

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which they hold little power. The literature on urban housing in the GS sometimes notes that the private rental sector is much neglected in research and policy debates, more so than in the GN. This was a point frequently made by Alan Gilbert, whose research on Latin American cities spanned decades.31 Mike Davis typified this sector in informal settlements of the GS as ‘invisible renters’. Their views are valid: there is relatively far less discussion about the problems renters face or their experiences of the housing dilemma. They are seriously neglected by policymakers. UN-Habitat’s regular reports on urban housing issues in the various regions of the GS will often reflect on this hiatus, but only briefly. Such reports mainly deal with what are perceived to be the key constraints on homeownership. Leaving aside the economic and political reasons for this emphasis for the moment, there is also the issue that the focus becomes almost self-fulfilling: governments choose, or are persuaded, to promote homeownership and social science research is often policy-focused, with research funding often tied to analyses of existing policies (i.e. homeownership). On the other hand, research on the characteristics of urban poverty, such as malnutrition, or on the livelihoods of the poorest groups, who are frequently migrants (both internal and foreign) to cities, often find that a dominant feature is renting. In a way, therefore, research that is not about ‘housing’ may be more likely to recognise the problems of renters. In much of sub-Saharan Africa, most residents of urban informal settlements in large cities rent. This is also true of many parts of Asia. In Latin America, ownership may have dominated in unplanned settlements based on land invasions, but as time passes and they are legalised, consolidated and ‘incorporated’ into the city, market forces can lead to house sales and the emergence of far more renting by both resident homeowners and absentee landlords.32 The phase of urbanisation in GS societies also plays a part. In the GN, internal rural–urban migration was largely a spent force in urban change decades ago. This is also true for much of Latin America. In Asia, and particularly in sub-Saharan Africa, many and sometimes most urban residents may still have been born in rural areas. Many are likely to rent. In addition, plot-holders and homeowners in areas around the edges of towns in sub-Saharan Africa may be drawn from 121

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previous rural communities there. If they rent to migrant lodgers and/or build freestanding rental units on their plots, they become landlords and landladies and their vested interests will shift in important respects to becoming oppositional to their tenants. There is a class issue. In a sense, there are parallels with the processes whereby the landed aristocracy in Europe could become urban landlords if their landholdings, derived from historical non-capitalist tenurial arrangements, were well placed relative to expanding cities. This is how aristocrats such as the Duke of Westminster and Earl Cadogan became two of Britain’s wealthiest men. Of course, as explained in Chapter 4, most such African landlords are small-scale and many farmers lose their land altogether in the processes of contestation over peri-urban land, as has been demonstrated across the region. Traditional chiefs and headmen, however, even if they do not theoretically ‘own’ the land, frequently stand to gain. The parallels with the British landed aristocracy are stronger in their case, although the wealth gains are in a different universe. The housing dilemma in the PRS, therefore, is not only about affordability but also about uneven power relations that so strongly affect the conditions of rental tenure and rented housing itself. As with the cost of purchased housing, for the many who cannot afford legal, ‘decent’, regulated rental housing, where informal housing markets are allowed to operate these will provide sufficiently cheap, if frequently dangerous and unhealthy, rooms. Until recently, generally that meant in the GS but, as Chapters 8 and 9 will show, this ‘solution’ is creeping back in the wealthier GN too. In formal rental housing markets, states may try to tackle unaffordability with rent controls and poor physical conditions and insecure and unfair tenure situations with regulations. Such regulations include, of course, the slum clearances in GN cities already described, but slums tended to reappear until mass PRH was provided for most in the lowest-income groups. Thus, any weakening of that sector swiftly pushes some of the poor back into the ‘low end’ of the PRS, where the toxic mix of tenants being unable to pay for ‘decent’ housing and lessors needing to make a profit can reinvent slum conditions. The urban housing dilemma can be identified in each sector, therefore, but they are all interconnected. The 122

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legislative situation for the PRS sways back and forth in different countries and cities, reflecting local politics and events and fluctuations in affordability curves, as well as global ideological shifts. In Europe and North America the two World Wars had significant effects. According to Franz Hubert, a management economist at the University of Berlin: [In the GN] rent control was not a political issue until the first world war. The disruptions of the war prompted all belligerent nations (and some others as well) to introduce special measures in an attempt to protect the tenant against the hardships resulting from the unexpected crisis … These measures clearly favored tenants at the cost of landlords, notably by depressing rents below their free market level, granting tenants security of tenure if they had none, and enabling them to prematurely terminate fixed-term leases.33

Hubert tracks the many shifts in such interventions in western Europe and the USA, as government sentiments about market freedoms changed several times. In Britain, for example, most controls for properties over a certain rateable value were removed in 1957 and the USA abandoned them altogether after World War Two, except in New York. In the 1960s and 1970s, various types of regulations about tenure and rent levels re-emerged in many parts of the GN. In Britain in 1965, a Labour government introduced ‘protected tenancies’ that theoretically provided tenure security and assessors to determine ‘fair rents’. A process of deregulation began again in 1980 under Margaret Thatcher’s Conservative government. In the USA, some rent controls were reintroduced in a range of cities in the 1970s. There are many types of rent control. Often governments merely try to limit rent rises during a tenancy to no more than the rate of inflation. Evidently that does little to address the housing dilemma, which relates to the many households that cannot afford anything like the market rate for either the PRS or house purchase. Fiddling with rises in market-set PRS rent is simply irrelevant to such households. In Britain, for example, if the gap between what a household can afford for housing from net earnings and the 123

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current monthly rent for a property with an appropriate number of bedrooms for that family is in the hundreds of pounds, as it often is now in London and some other cities, the fact that the rent can rise by only a certain amount in the near future is cold comfort. This leads back to the central significance of what is ‘appropriate’ in terms of space and the proportion of income for rent. As the next chapters discuss, shifting previously accepted minimum standards is a housing battlefield. Another battlefield for policies affecting the rental sector is found in debates over preferences for renting versus homeownership. For many urban households this is an academic debate, complex and interesting with many valid arguments for and against and policy implications for other people, but of absolutely no relevance to themselves as there is no chance of their buying a home. However, as contemporary institutional set-ups, ideologies and governments do tend to focus on ownership, this does mean that housing resources and policy initiatives lean in that direction. If governments chose to promote renting and implemented policies to ensure that there were ‘decent’ options open for a larger share of those needing housing, the boundaries of the proportion thus housed in the PRS could shift. Alan Gilbert argues that the private renting option is too easily dismissed by policymakers worldwide, often pointing to the examples of Germany and Switzerland, where far more households rent privately than is usual in the GN. In 2016, 40% of German households were in the PRS compared with 19% in England.34 Gilbert does, however, usually note that Germany has a history of regulations for this sector.35 The significance of this as the key foundation of the ‘choice’ needs to be understood because the extent of state intervention in Germany would be anathema to most governments caught up in the ethos of neoliberalism. As is quite often the case in (West) Germany, the forces that shaped this started with World War Two. The scale of destruction and population displacement there was so profound that market forces as determinants of housing had largely to be abandoned. This was a phenomenal new starting point for an entire urban housing system in a capitalist society. It helps to explain its subsequent trajectory compared with other countries in western Europe, where, 124

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as explained, there was some shift towards more government intervention – and this was important – but most housing remained in the market sector. Germany’s Wohnungszwangswirtschaft (housing controls) ‘combined strict rent control of all pre-1948 premises with the assignments of tenants by public authorities’.36 These housing laws originated as law Number 18 (out of 46) imposed on Germany by the Allies.37 Thus, the private housing sector vested interests, which usually prevent such far-reaching abandonment of basic capitalist principles, were overturned by force majeure. There were obvious parallels with housing in communist eastern Europe (including East Germany), except, crucially, in West Germany the properties still belonged to the private sector. Although allocations were gradually taken out of state hands, the strict rent controls and secure tenancies remained until the 1960s. In essence, a profound shock to a capitalist housing system had forced an end to the key features of the capitalist housing dilemma in German cities. That also shaped national cultural norms and perceptions of the social and economic risks and difficulties of renting. Controls were removed only when the deficit in local housing was estimated to be under 3%, which was achieved by the late 1970s. The exception was West Berlin, where the original strong rent controls remained almost to the end of the twentieth century,38 making it one of Europe’s most studied ‘experiments’ in urban housing. Very strong protection against eviction has remained the norm for the whole country. The 1971 Tenure Security Act allows for an infinite term of stay for renters and rent increases pegged to local averages for similar accommodation (to prevent unreasonable and sudden hikes to ‘encourage’ tenants to move on) – a type of so-called ‘secondgeneration rent controls’. Only new leases allow new market rents to be set. This only slows the rise of rents but it is enough to make a difference. The average German tenancy in 2016 lasted 11 years, so many are for much longer, giving a family long enough to have children and put them through school in a secure and familiar environment. In Britain, the average tenancy is only 2.5 years and an ‘assured’ shorthold tenancy is only 6–12 months, after which the lease can be ended without justification.39 However, one way of evading German restrictions has been for landlords to undertake 125

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property ‘improvements’, which allows them to raise rents by more than the controls allow. This began to be widely used across German cities, resulting in tenants being ‘forced’ to move because their rents became unaffordable. Legislation to limit this loophole – Milieuschutz (community defence) – by banning certain types of luxury improvements is thus being enforced in ‘gentrifying’ areas in many cities, from Hamburg to Munich to Berlin.40 As with much of the rest of western Europe’s main cities, market forces have led to rapidly increasing property prices in particular parts of German cities, which can also feed through to ‘new’ market rents. In such property, ‘hotspots’ restrictions are now being placed on such rent rises via the Mietpreisbremse (rent brake), which limits the new rent to no more than 10% above average local rents for similar properties. These had some effect as rent rises in these ‘hotspots’ stopped outstripping those in other areas.41 In Germany, therefore, the legislative landscape reflecting the inevitable conflicts between renters and landlords keeps shifting, but, crucially, the interests of private-sector renters are better represented than nearly anywhere else in the GN. In part this is because they are a much stronger and more socially mixed democratic force there that has to be reckoned with in policymaking because of the country’s ‘peculiar’ housing history. It is really this that would be extraordinarily difficult to replicate in most other contemporary societies in both the GN and the GS where the relative political power of property owners and developers is often overwhelming. However, there is another factor at work in Germany relating to the influence of the effects of wars on its society and economy. This is a very strong resistance to any financial policies that might lead to high inflation and undermine financial stability, stemming from embedded institutionalised memories of the monetary disasters which occurred after both World Wars. A result has been that borrowing to buy a house has generally been much more expensive and difficult compared with most other GN countries, where alliances between local and central governments, housing finance, property developers and landlords tend to trump other interests, including voices for ‘sound money’. In Germany, the norms used about what proportion of income is ‘safe’ or ‘affordable’ to pay for 126

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housing are applied in a very specific way, since ‘under no circumstances can your monthly mortgage payments exceed 35 percent of your monthly income’.42 Thus, Germany exemplifies the importance of accounting for specific local contexts in housing outcomes. In respect of loans for homeownership, Germany’s banks are less like those in the GN and more like those in the GS, where very many urban residents are excluded from the formal-sector, planned housing market because financial sectors impose conditions they cannot meet. In much of the urban ‘development’ literature this is seen as a housing sector problem to be overcome, rather than a parallel with a GN society some development economists might otherwise urge developing countries to emulate. It is also useful to note that the situation in Switzerland, which has western Europe’s lowest homeownership rates at 34%, is ascribed by Bourassa and Hoesli, writing in the Journal of Real Estate Finance and Economics (hardly a source of radical social analysis), to precisely the issues this book defines as part of the urban ‘housing dilemma’: house ‘prices are very high relative to household incomes and wealth’.43 Necessarily, therefore, most people rent even though most would prefer to own.44 As in Germany, there are very significant legal protections for renters and in some local government areas (cantons) rent can even be partly set against local taxes. Although there is not much public housing, in the largest city, Zurich, where about one in six Swiss live, many people live in cooperative housing, outside the capitalist sector, where rents are heavily subsidised.45 In Geneva, 21% of households, too poor to otherwise afford proper housing based on means-testing, live in canton-subsidised apartments.46 Thus the housing affordability issue, which is usually most severe in a country’s largest cities, is addressed through non-market solutions. Critics of rent controls and tenure protections invariably point out that they discourage investment in the PRS, which means there is less rental housing than there would otherwise be, either through fewer new builds or the conversion of rental accommodation to other uses or sold for homeownership. In turn, this is argued to help push rents up and make it even harder to find somewhere to rent. In one sense, these points are valid. Anything reducing the profitability of any sector encourages investors to consider alternatives. 127

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Unregulated rental markets, as in the informal settlements of cities in the GS, do deliver lots of rented rooms at low prices. However, most orthodox, number-crunching economists who make these arguments forget or ignore the fact that, if the critique relates to urban societies in the GN, according to their disciplinary tools the whole market is already ‘rigged’. The advantages for society as a whole of ‘decent’ rental housing are not, and cannot be, factored in to orthodox neoclassical economic equations. Decent standards and conforming with regulations ‘distort’ free-market signals in housing at every turn. Furthermore, most private-sector landlords and property owners (and GN economists themselves!) would have it no other way. Overall, it serves to push rents up, not down, removing competition from dangerous, unhealthy, ‘indecent’ rented rooms. It is also this which makes their properties such valuable assets and their own lives and lifestyles in the city so desirable – as long as everyone conforms. Or, perhaps one should say, as long as everyone else conforms. There can be more money to be made for the individual landlord who breaks the laws and charges more, evicts tenants illegally, and refuses to pay to maintain safe standards. Herein lies the route of Rachmanism, a term used in British housing discussions that derives from the behaviour of an infamous landlord, Peter Rachman, in Notting Hill, London, in the 1950s and early 1960s. He used violence and threats to push protected sitting tenants to give up their leases so that he could replace them with higher-paying, unprotected tenants in unmaintained and often subdivided accommodation.47 As is often the case, his extortion was facilitated by charging the higher rents for worse housing to vulnerable minorities who were being excluded from other PRS housing through social discrimination and were thus particularly desperate and less likely to complain. In this case it was recently immigrant West Indians. The ‘rogue’ landlord can be found in most cities where there are regulatory loopholes or the state chooses not to implement laws rigorously. In the UK, Rachman’s techniques were one reason why the 1965 Rent Act was passed, giving tenants greater tenure security.48 Since GN urban rental prices are generally ‘distorted’ by having to cover the cost of ‘decent’ conditions and space, the orthodox economic arguments cannot incorporate the housing dilemma: that 128

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so many households simply cannot afford to rent ‘decent’ housing. This is why, even where there are as many controls on the PRS as in Switzerland, significant proportions of the two main cities’ residents are living in cooperative housing or have to have their private-sector rents subsidised. This latter approach to the housing dilemma is considered next. Topping up incomes to solve the housing dilemma in the rental sector

States also intervene in the PRS by simply covering the gap between what poorer groups can afford and ‘economic’ rents through direct payments to, or on behalf of, the households involved. Such transfers of income from tax revenue to poorly paid households are a straightforward subsidy. In the UK these are known as housing benefits. The Beveridge Report of 1942, a founding document of the UK welfare state, recommended some form of such subsidies in recognition of the housing dilemma, which was termed the ‘problem of rent’.49 As with any very obvious welfare intervention that is easily costed and visible, criticism can come from some of those on higher incomes and businesses who feel this is an ‘unreasonable’ use of ‘their’ taxes to support the poor. It is more rarely taken on board that the beneficiaries of these subsidies go far beyond those housed. Both employers paying low wages and private-sector housing providers thereby increase their profits, as the subsidies help reduce upward pressure on wages and downward pressure on rents. This particular way of addressing the housing dilemma is in fact the one that most obviously demonstrates the root causes of the dilemma itself: that capitalist markets set wages for many that are too low for the rents that capitalist landlords must charge in order to be profitable (if housing is planned and ‘decent’). Certainly, some employers could pay some of their employees more and some landlords could charge less rent without the market or housing systems foundering. However, that would make those actors less profitable, so they always lobby against any efforts to reduce state housing subsidies by realising either higher pay or lower rents. And these are usually powerful ‘stakeholders’ with much influence in political decision-making about housing. 129

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Their lobbying is helped by the fact that ordinary taxpayers usually fail to realise that housing benefits are also helping the rich. However, even when efforts are made to even out the ‘burden’ of tackling the housing dilemma between the state (or taxpayers) and private-sector employers and landlords, the substantive costs will always remain. There is just no way around it in a capitalist society where market forces play the key role in determining incomes (unless ‘decent’ housing standards are abandoned). Of course, some who need direct rent subsidies work in the public sector – in, for example, education, policing or health. At first glance it might appear that this is therefore a separate issue from the impact of market rates determining low pay and of housing benefits subsidising capital. But it is not. First, public-sector incomes for the lower paid in these professions do reflect market rates even if they are also usually higher than in the private sector as public-sector employees are better organised. Second, these services are part of the enabling social infrastructure for capitalism that governments are generally ‘allowed’ or expected to provide, even under neoliberalism. Finally, although this is less often recognised, were public-sector wages for such groups to be increased to the point where they did not need housing subsidies, this would merely transfer the budgetary cost between government departments. This was the conundrum that faced so many former colonies at independence. The national treasury would still have to foot the bill – and would still be subsidising the capitalist housing sector. However, very dramatic interventions about what sorts of households are legal or sustainable in big cities can make further inroads into the ‘burden’ of these subsidies, as will be discussed in Chapter 9. In the UK in 2013–14, housing benefits cost £24 billion, equivalent to a quarter of the national budget deficit. Around 5 million out of a total of 27 million households claimed. The numbers involved, the sheer size of the annual sum and its impact on the state budget are the clearest indicators possible of the embedded nature of the housing dilemma. Once this is taken on board, the futility of the argument that increasing the supply of private-sector housing can make any real difference to the ‘problem’ becomes clear. Many people understand that the vast majority of new housing in cities with good employment opportunities could never be rented by those 130

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on low pay, but they tend not to realise how many households are in this position and how the sums add up. Housing benefits can be reduced by investing more in the first ‘solution’ considered in this chapter: providing public-sector housing at rents related to typical rates of low pay. Yet even the most recalcitrant and stubborn pro-market capitalist seeking to reduce ‘inefficient’ government expenditure can see the problem once they recognise the parameters and the alternatives: this is robbing Peter to pay Paul. The overall size of the government ‘bill’ to subsidise housing remains much the same. However, as already noted, housing benefits paid to private landlords serve to increase private profits. The private sector therefore prefers that option but it makes no difference to the scale and tragedy of the housing dilemma for those who cannot afford housing or to the costs borne by society more broadly for propping up capitalism. Whittling away at how much of the rent the government will pay, and fiddling with the ‘decency’ of the housing allowed, can chip away at the bill and cause much misery, as will be seen in the next chapter, but the reduction in the bill is marginal. The fundamental issues were addressed by Paul Johnson of the UK’s Institute for Fiscal Studies in an interview with the BBC in 2015. As he explained, despite cuts to government support for those who cannot afford housing in the UK since 2010, total spending on housing benefits had actually risen because ‘rents rose, the numbers of renters rose [because fewer could afford to buy], and earnings fell … [also] the government has almost stopped building new council houses and has reduced the subsidy on the rents that social tenants pay. Since a lot of council tenants are poor, this has just led to more being spent on housing benefit’.50 The arguments presented so far have deliberately used the shorthand of ‘low pay’ to delineate the households in the housing dilemma. This is to emphasise that this is not a problem confined to the unemployed, whether they be in cities in the GN or the GS. Being unemployed exacerbates the issue but it is not the key characteristic of those in the housing dilemma. There are far more households with a worker who cannot afford urban housing than those where unemployment is the chief cause of low incomes. In the UK, the incidence of poverty (as measured in that country) among households 131

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with workers is increasing. The Institute for Fiscal Studies calculates that 58% of those in poverty (around 8 million people) lived in a working household in 2017 compared with 37% in the mid-1990s. The main reason was rising housing costs followed by increased earning inequality.51 However, another significant issue driving the housing dilemma is the inability of any capitalist economy to ‘deal’ with the inconvenient fact that there are always urban households needing homes who do not include a worker (or work-seeker). That is the nature of society. In particular, people get old. The more successful the society, the more old people there are. In highly urbanised capitalist societies, the urban housing ‘market’ has no place for such people if they are not working (and often even if they do, just as with other workers). Before welfare states, housing subsidies and reliable pensions in the GN, this was all too obvious – as it still is in many cities in the GS. Once unable to compete in the market for work, old people could swiftly become destitute and homeless if their family circumstances meant that there were no relatives to help them. In Britain, many ended up in workhouses where conditions were often so poor that they died soon afterwards, or lived out their days in an atmosphere of deliberate humiliation to discourage people from ‘becoming’ destitute. A favourite, although poignant, British music hall song composed in the late nineteenth century spoke of the sadness of ending your days in this way: the performance of ‘My Old Dutch’ about an elderly husband’s love for his wife with whom he had ‘been together now for 40 years’ starts with the old couple being forcibly separated when ‘housed’ by the workhouse. In Dickens’ Our Mutual Friend, the elderly Betty Higden, unable to pay for housing any more, takes to the roads rather than face her long-standing fear of the workhouse, and dies shortly afterwards. Her description of the conditions she fears are telling: Kill me sooner than take me there … God help me and the like of me! – how the worn-out people that do come down to that, get driven from post to pillar and pillar to post, a-purpose to tire them out! Do I never read how they are put off, put off, put off – how they are grudged, grudged, grudged, the shelter, or the doctor, or the drop of physic, or the bit of bread?52 132

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In GS cities, most people still do not have any pension, and for many who do they are so tiny and irregular that they are of little consequence in relation to large budget items such as housing. Change is occurring and universal pensions are now found in countries such as South Africa and Brazil. In China, those with a local urban hukou (registration) have rights to some public services in the city, including housing. However, the consequences of ageing in GS cities can play a much more critical part in people’s decision-making about housing – and, indeed, their ability to be in the city at all – than in societies where pensions are reasonably universal and reliably paid. Where state pensions are fairly universal, the housing dilemma still faces the millions whose pensions are too low for them to afford ‘decent’ housing. Low pensions thus require topping up for rents to be paid in precisely the same way as low pay does. In a capitalist society, low pensions can mainly be understood as a function of the initial issue of low pay. For example, for decades in the UK, until the financial crash of 2008, public-sector work pensions tended to be somewhat better than those for people on similar pay and jobs in the private sector. Although some argued that this was an unnecessary ‘burden’ for taxpayers, not only did the gap then reduce or disappear after a decade of austerity measures but, from the perspective of the housing dilemma and government expenditure, lowering the costs of government contributions to pension savings for many public-sector workers yet again merely shifts the problem to another budget ‘heading’. When they retire on lower pensions they will need more housing benefits. Anything that reduces net incomes makes the public cost of housing subsidies higher. Conversely, anything that increases net incomes reduces the need for such subsidies, which brings us to the next ‘solution’. Tinkering with minimum pay and pensions is never enough

Governments for which urban housing subsidies are a significant element of their expenditure and that are striving to make savings and ‘roll back the state’ may realise that improving the earnings of those on low pay rates in the private sector will mean less need for subsidies and/or public housing. They may then decide to set or 133

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increase minimum hourly pay rates. This is unlikely to occur just because of housing policies, of course. Any government expenditure on interventions to help the poor, if means-tested, will be reduced at the margins if earnings rise, whether the subsidies are for healthcare, children, school meals, tax credits, food vouchers, cheap staple foods or the myriad social spending that occurs across the world to alleviate the worst welfare outcomes for households on low incomes. Much of the expenditure involved is in the GN, but GS governments are increasing their provision of many types of social grants and many have a long history of much more direct intervention in staple food (and fuel) prices than is typical in the GN (although this may benefit everyone, not just the poor). Many GS governments will set minimum pay rates for particular types of work, too. The impact of minimum pay regulations are complex and diffuse and the links with the housing dilemma are evidently indirect. However, the rhetoric around minimum wages can reflect heightened realisations of how employers’ decisions on pay levels play a central part in determining government budgets. In the UK, in 2016, the government began to implement phased rises in minimum pay. The way in which low pay fed into workers’ struggles to achieve basic living standards and the subsequent costs for the state and taxpayers were alluded to explicitly in a budget speech announcing a new ‘National Living Wage’. It was said that ‘it can’t be right that we go on asking taxpayers to subsidise, through the tax credit system, the businesses who pay the lowest wages’.53 The target at that point was to get more taxes from ordinary workers by changing their eligibility for a system that reduced their tax burden, with the quid pro quo of higher wages. The sums did not actually add up and the backlash was so severe that that idea was ditched. However, given that the policy came from a right-wing Conservative government that was ideologically strongly pro-business and against intervention in the market, the rhetoric in the speech was interesting. It seems the commitment to reducing the role of the state more broadly by reducing government expenditure and imposing austerity measures to ‘balance the books’ trumped that ideology at that point. Nonetheless, as

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is so often the case, in relation to urban housing the new minimum wage policy merely tinkered with the housing affordability curves, shifting along by one or two percentage points at best the proportion of households that could ‘demand’ (i.e. afford) decent housing in the private sector. The problem was that the rises in minimum pay rates were completely insufficient in relation to the housing dilemma in most large urban areas in the UK. In 2016, the hourly rate for those aged 25 and over increased by 50 pence, and then by a further 30 pence in 2017 to £7.50. After two years an extra £20 pounds or so a week for a full-time worker, after taxes and inflation, could help a bit with food and clothes or allow for some extra heating: all things that can be helped by limited incremental payments. But housing payments are large and ‘lumpy’. Housing costs had also been rising for years while real-term pay was falling. Thus, the hike in minimum pay was, at best, putting the poorest-paid people back to the general parameters of the housing dilemma experienced a few years before. The sheer scale of the problem was illustrated in Figure 2.2 in Chapter 2: as shown, the gap between affordable rents even for those on median wages was in the hundreds of pounds for a two-bed flat in 2016, and all anyone on the new national minimum pay could have afforded was one room in a shared house (and not even that in London). In sum, if a 30% level for affordable rent is taken as a guideline, minimum pay rates in the UK would have to more than quadruple for a family with one worker to afford to live in London. This is why the UK National Living Wage is anything but. It also demonstrates the hollowness of raising the wage by a few percentage points. Even that led to an outcry from the business community and in the financial media. Arguing about whether the affordability level should be set at 30% or 40% or even 50% of incomes is also shown to be irrelevant. For London, in particular, the situation is impossible: the city is in crisis. There have been recent policies to increase minimum wages in the USA as well. Again, this has, in some ways, served to highlight the housing dilemma. In 2017 the federal minimum wage was $7.25 per hour ($15,000 per year). Some counties do have much higher

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local rates, ostensibly to reflect their much higher living costs. For example, the minimum wage was raised to $15 from the end of 2019 in New York, and Los Angeles County plans to introduce the same rate by 2021. However, this would not rent even a one-bedroom home in either place in 2017, using the federal affordability level of 30% of income for rent and utilities. That would require a pay rate of $22.98 in Los Angeles and $27.29 in New York.54 Where there are universal pensions and continued efforts to maintain ‘decent’ housing, reducing state pensions to cut public expenditure is also problematic (and similar structural issues pertain to benefits supporting people with disabilities). Pensions are usually by far the largest element of social expenditure in a GN society; they account for about half of benefit spending in the UK. Many pensioners have only a basic state pension as they worked in lowpaid sectors that did not provide occupational pensions. This often means that the government must also provide them with housing subsidies. In the UK, the basic pension of £159.55 per week in 2017 was less than the entire average monthly rent of £694 for a onebed flat in the PRS. On such low incomes, housing benefits may be needed even to cover rents in council housing. This is one reason why the UK government has been reluctant to remove a link between inflation and pensions. Since the financial crash, workers’ real incomes have fallen but this link has meant that pensions have not. Even though UK pensions are low by European standards, this has led to pressure to let pensions also fall in real terms – a race to the bottom between the old and working-age people. But people over 60 years of age make up 35% of housing benefit claimants. If the pension in relation to housing costs falls, those subsidies will increase. The implications of low pay for the housing dilemma are thus long term. In Japan, annual state pensions are so ‘measly’ ($7,000) that they are ‘very hard to live on … the costs of rent, food and healthcare alone will leave recipients in debt if they have no other income – and that’s before they’ve paid for heating or clothes’. One result has been that pensioners without additional occupational pensions are increasingly committing petty crimes, accounting for over one in five convictions in 2016 compared with around one in

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20 in 1997, because they ‘feel that if they can’t survive on the state pension then pretty much the only way not to be a burden [to their children] is to shuffle themselves away into prison’.55 Fixing cities by addressing the housing dilemma via direct and indirect public interventions in the rental sector is one way of tackling the problems created by low incomes and is the best way of assisting those in the lowest income bands. Another set of policies, considered in the next chapter, attempts to square the circle by subsidising homeownership in various ways.

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Chapter 6

Squaring the circle: affordable urban homeownership

Subsidising homeownership Governments can address the housing dilemma through rental policies but they often prefer to do so by helping urban residents to ‘buy’ a house. This is a complicated area since the motives and policies are highly variable across the world and at different times. In some countries, policies may reflect a real desire to help the poor or address a history of extreme disadvantage for certain groups. Policies may also be a response to vigorous social campaigning by residents in particular (often unplanned) areas or by housing advocacy groups. In others, ideological or short-term ‘electoral’ commitment to the promotion of homeownership for less laudable reasons may be the main drivers. For example, the stronger the state’s commitment to markets, free enterprise and limiting state intervention, the more policies tend to support homeownership. In other words, the neoliberal turn in capitalism and the end of communism provided a massive push for policies across the world predicated on the presumption that homeownership was ‘good’ and far superior to renting. The USA has taken this ideology the furthest for the longest period of time – indeed, it underpins that country’s vision of the ideal society. It is part of the ‘American Dream’. However, the political commitment from the top for this 138

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is largely about trying to house people in such a way that free enterprise can profit from the process. Increasing the welfare of people in cities by getting them ‘decently’ and affordably housed is a lower priority. The neoliberal brand of capitalist ideology also places much emphasis on the individual, rather than ‘society’, and on the view that responsibility for welfare outcomes should preferably be borne by individual households. Any way of reducing state assistance is seen as a normative goal. Homeownership fits into this in the sense that the maintenance of the house is borne by the household, and once (or if) the mortgage is paid off, the house becomes an ‘asset’ and the owner joins the property-owning class. Owning private property is at the heart of capitalist ideology. In theory, having reached that status, there should be no future claims on the state for housing. The need to keep up mortgage payments before full ownership is attained also has the advantage for employers of ‘disciplining’ workers and discouraging them from taking any action to improve their conditions that could lead to loss of pay, because their fear of losing their home is much greater than for renters as they have ‘skin in the game’.1 Unlike the sharply differentiated vested interests of renters and lessors, however, in general terms the homeownership route to urban housing plays to the aspirations and interests of all concerned. Most people want to own their home even if the likelihood of doing so is small.2 This is convenient for all the private-sector actors involved and for most governments. Their reasons differ but, in theory, they are working towards the same result. However, the differing motivations are crucial in reality. For many households, homeownership is not so much about having a collaterisable asset in the financial sense beloved of neoliberal ideologues such as Hernando de Soto,3 but about having a family asset that is both ‘for the family’ and allows them to ‘be a family’. Homes and houses have been central elements of human culture for millennia and their meanings do not entirely shift just because the mode of production changes. The irony of a commitment to homeownership in states such as the USA is that, while it is tied up with an ideology about leaving 139

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things to the allocative forces of the market, because of the housing dilemma there has had to be significant state intervention to boost house purchases. Thus, most housing subsidies in the USA have been for house-buying. These have taken many forms. For example, in the post-war period, the GI Bill, which provided ‘extraordinarily generous’ government backing for very cheap housing loans to veterans, helped increase American homeownership rates to over 60% by 1960.4 A long-standing subsidy is tax relief on home mortgage interest. This cost the federal government $71 billion in 2015 although only about 10% of that accrued to households earning under $100,000.5 A key role has been played by government insurance of much private-sector mortgage lending through federal institutions such as the Federal National Mortgage Association and Federal Home Loan Mortgage Corporation (known as Fannie Mae and Freddie Mac). By selling their house loans to these institutions, private mortgage providers could obtain extra liquidity and thus make further loans, expanding the housing market. Fannie Mae, for example, was set up during the 1930s Depression as a government-sponsored enterprise (GSE). It was privatised in 1968. This created an awkward hybrid open to pressure from private shareholders to maximise profits, and conveniently ‘off the books’ of government debt, thus apparently falling into line with national ideologies but still receiving implicit federal government support and expected to fulfil some public responsibilities. Furthermore, under the influences of neoliberalism and the accompanying mood for deregulation, the state began to allow and even encourage privatesector housing finance institutions to lend sums for house purchase to people across urban America for whom the repayments were unaffordable. It turned out, as was to be expected, that addressing the housing dilemma ideologically did not work. The hard economic limitations of the mismatch between low pay and house costs eventually asserted themselves in the most dramatic fashion with the financial crash of 2008, as detailed in the next chapter. Squaring the circle needed more, not less, state investment and regulation. In the end, the costs to the state and American taxpayers of saving the economy far exceeded the costs of a more reasoned approach to the housing dilemma. 140

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In the rest of the Global North (GN), many countries tagged along after the USA with highly risky lending for house purchases.6 After the crash, the subsequent economic policies of very low interest rates in the GN, ironically, pushed property prices (and rents) much higher in cities well placed in global financial circuits. Thus, the housing dilemma was greatly exacerbated. As Chapter 7 will show, this has introduced various further ideologically driven policies to assist some to achieve homeownership. These are, as is so often the case, of little relevance to the, now larger, majority who cannot afford housing, although the accompanying rhetoric refers constantly to ‘affordability’. For many households, their housing problems were made even worse by the austerity programmes ushered in by the crash that ate into other types of housing support. So is it impossible to achieve mass homeownership in a strongly capitalist country in the absence of unplanned or non-capitalist tenurial arrangements? Some point to the example of Singapore, where 80% of households are homeowners and the government is unabashedly pro-capitalist as proof that it can happen. Yet, in reality, it is one of the best proofs of the arguments in this book, since this success has been achieved via massive intervention. Subsidising homeownership in Singapore

Singapore provides a particularly interesting example of the tensions between free-market principles and ideology and the housing dilemma. It is usually discussed and described by economists, investors and frequently admiring governments elsewhere as a bastion of right-wing, free-market economics that have delivered remarkable social and economic development. In 2015, the Nikkei Asian Review described Singapore as ‘a vibrant and prosperous business hub brimming with the spirit of free-market capitalism’ in which ‘successful efforts to promote economic development … have underscored the importance of serious deregulation’.7 The Economist is similarly impressed, highlighting the ease of doing business in Singapore, and how the government has been kept ‘small, efficient and honest’.8 The UK’s Conservative right-wing government sometimes expressed admiration for the so-called ‘Singapore model’ as one 141

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that might offer a strategy for the UK’s economic future and policies after the referendum of 2016 which began the process of the country leaving the EU, the world’s most powerful trading bloc. As the New Statesman noted, ‘during the Brexit campaign Singapore was held up by economic liberals as a potential model for Britain’s future’.9 There were some warning voices: the Financial Times, which is pro-free movement of labour, noted that Singapore had had ‘extraordinarily high immigration’ and that many who voted for Brexit were opposed to that. It also pointed out that, ‘rather than a model of laissez-faire capitalism, its state is actually highly interventionist, from its famous chewing-gum ban to wide-ranging public ownership of everything from banks to airlines’.10 That intervention includes one of the world’s most radical and thorough set of public housing policies outside the former communist countries. Most commentators on Singapore choose to ignore this, as it self-evidently does not fit with the neoliberal ideology many profess to admire. Like the housing dilemma, it is an ‘inconvenient truth’. Some may not realise it, given that it is rarely a characteristic selected to typify Singaporean society, except by those in academic housing circles for whom the state’s ambitious and massive housing programme may be held up as proof that public investment in housing can both work and provide decent housing for the majority. Singapore’s Housing and Development Board (HDB) is forthcoming, however. It calls public housing ‘a Singapore icon’ which has ‘housed an entire nation – today [2015], more than 1 million flats have been completed in 23 towns and 3 estates across the island. HDB flats are home to over 80% of Singapore’s resident population, with about 90% … owning their homes’.11 Their policies are ‘planned to support national objectives such as maintaining racial harmony and strengthening family ties, at the same time focusing on the needs of the elderly and those who may be in financial difficulty’. As the HDB points out, before its establishment in 1960, ‘home for the majority of Singaporeans was a rented cubicle or a hut in a squatter settlement’. In other words, formal and informal markets at that time delivered inadequate slum rental accommodation or informal housing in the ways typical of so many Global South (GS) cities. Only by bucking the 142

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market was Singapore transformed. It is hard to think of a more different description of the country compared with the one usually touted about ‘small government’ and free-market principles. The keys to success include government allocations of serious amounts of money to the schemes and the fact that mortgage payments are kept affordable. On average, first-time buyers pay less than a quarter of their monthly household income, which, as the HDB notes, is ‘a figure lower than the international benchmark for affordable housing’.12 Various grants are available for households who nonetheless struggle to afford housing. Age, income and other financial commitments are factored in to the maximum mortgage loanable and an insurance scheme has been in place since 1981 to prevent dependants becoming homeless should incomes fall due to illness or death. First-time buyers who are married with children receive more help than other groups. There are schemes to assist multi-generation families or to rehouse elderly people near their families. The schemes started off in 1960 mainly with units for rent, but the focus quickly shifted to homeownership projects, which began in 1964.13 So how can the government afford this? First, it owns 80% of Singapore’s land, having acquired most of it through compulsory acquisition after independence in 1965, limiting compensation to below-market rates. This ‘was effective in keeping the costs of building houses and industrial premises affordable’14 and also meant that the state benefits from urban development. This is not a feature that contemporary capitalist states in Europe or North America can emulate – that would entail revolution. In these states, along with most governments in the GS with the very notable exception of China, profits from urban development projects tend to accrue to the private sector and ensuing land price rises increase the costs of government housing policies, whether they be for subsidising rent or house purchases. Also, as Edwin Loo, a Singaporean chartered town planner, points out, for other land there is a ‘comprehensive system of land value capture’ through taxation. Many GN governments lean instead towards cutting taxes for the entrepreneurs who support them, with some politicians even citing Singapore as a model to emulate in this respect. Professor Chua Beng Huat of the National University of Singapore points out that 143

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this not only misunderstands the extent to which Singapore is ‘seriously interventionist’ but also that, while ‘in the UK the quality of life of each successive generation after the Baby Boom gets worse … that’s the global inequality situation … Singapore is better because of the public housing. The housing keeps Singapore stable.’15 Mass homeownership, albeit of small or moderately sized apartments in high-rise buildings, can therefore be achieved in a major city today. But it requires an approach that faces squarely the impossibility of market forces meeting housing needs.

‘Recognising’ informal and unplanned settlements: ‘quiet encroachment’ and homeownership In 2000, Asef Bayat, Professor of Global and Transnational Studies at the University of Illinois, wrote ‘From “dangerous classes” to “quiet rebels”: politics of the urban subaltern in the Global South’.16 He introduced the concept of ‘quiet encroachment’, defined as ‘[s]ilent, protracted but pervasive advancement of the ordinary people on the propertied, powerful, or the public in order to survive and improve their lives’. This was not about organised collective action with clearly defined political outcomes. It could refer to the many daily activities undertaken by ‘ordinary people’ in the cities of the GS that allow so many to construct an informal livelihood such as roadside trading, illegal hook-ups to electricity and unlicensed motorbike transport. It did not specifically relate to housing. However, it includes the processes by which hundreds of millions of people have become homeowners in many cities of the GS. As described in Chapter 4, informal, unplanned housing areas, often but not necessarily on the edges of cities when first built, are essentially the main way in which the housing dilemma has been ‘solved’ for many, and sometimes most, in such cities. The contribution of this to urbanisation processes and the number of urban homeowners in the GS is phenomenal. Precise numbers are impossible to estimate. The situation is fluid, as more encroach. Should homes that are as yet ‘unrecognised’ by the state be included as ‘urban’ homeownership? There is, as discussed in Chapter 4, an important difference to be drawn between housing built ‘legally’ on land under 144

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indigenous tenure arrangements, which are at odds with capitalist property norms and urban regulations, and housing that occupies land owned by the state or the private sector according to those norms. The first is not ‘squatting’; the second is. However, across the world, both of these sorts of residential areas may eventually be incorporated into the city by being recognised by the government. Former squatters may attain legal ‘capitalist’ tenurial status or, at the very least, security against eviction (which in most cases is their real priority). At that point, in what may be a conflictual situation as the stakes are high, those who manage to hold on to or obtain ‘title’ to their plots become official urban homeowners. Sometimes squatters in central areas are ‘compensated’ with legal sites further out, or those who can prove long residence are relocated to smaller areas on the same site. Services such as water and electricity, if not already laid on via previous negotiations, postal services and solid waste collection, improved roads and myriad other services associated with urban formality and ‘planning’ can arrive. With greater security, homeowners may start to ‘consolidate’ their houses, build extensions and extra storeys (not necessarily in accordance with urban regulations), and generally upgrade. This process of officially recognising and ‘upgrading’ informal urban settlements was popularised by the architect John Turner in the 1970s. He emphasised how formal homeowners would invest once they had security from eviction. Generally they did invest. It was a great success – for creating a new stratum of urban homeowners. It was often not, however, so successful for the other residents – renters – who tended to see their affordable rents start to rise. Once housing potentially becomes part of official housing ‘markets’, the rules of the market start to have their effects on affordability. The outcomes of these processes on affordability across housing types are complicated, therefore. However, their impact on the specific measure of homeownership rates in the recent history of cities is probably more important than any other global urban process. And this is the result of government policy – regularising informal settlements is done by the state. The investments in the houses themselves come from the people, but the ‘granting’ of their ‘right to [be officially part of] the city’ comes from the state. 145

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It can thus be considered as part of the ‘social contract’ between the state and low-income urban populations, just as public housing was in post-war Europe. It is always contested, but by ‘the late 1970s governments began to respond positively to informal selfhelp settlements in Latin America and elsewhere, such that by 1990 … regularization had become the conventional wisdom and primary policy response’.17 Social activism, sometimes aided by nongovernmental organisations (NGOs) such as Shack/Slum Dwellers International,18 with the aim of convincing officials of the logic and salience of this as a ‘solution’, organised outright political protest,19 and clientelist links with local politicians20 frequently play a part. The significance of the process has long been recognised. In 1982, Alan Gilbert and Josef Gugler argued that ‘squatting is the most conspicuous political action of the urban masses in the Third World Cities’.21 Davis called it ‘pirate urbanization’ and noted: ‘“No-cost” peripheral land has often been discussed as the magic secret of Third World urbanism: a huge unplanned subsidy to the very poor.’22 However, this ‘secret’ is not only for the very poor (by local standards) – it may include ordinary people on ordinary incomes for that city for whom formal ‘decent’ housing is utterly unaffordable. Bayat’s use of the descriptor ‘ordinary people’ was meaningful. Yet, comparatively speaking, it has allowed people from lower deciles of the local income distribution to become homeowners than is typical in the cities of the GN, where their counterparts would be faced with hopelessly unaffordable routes to homeownership. The crucial step, though, is not the ‘squatting’ or unplanned self-building but the acceptance of the inevitable via state recognition of the settlements thus formed. As Ananya Roy, Professor of Urban Planning at the University of California, Los Angeles, argues, it is the state ‘that makes and unmakes informality’.23 The process is entirely at odds with capitalism, of course, and the sacrosanct nature of property rights. This is self-fulfilling, in a sense, because its ubiquity in the GS speaks to the impossibility of that mode of production allowing mass formal urbanisation to occur. Once in the system, however, new home- and landowners are likely to fight for their ‘property’ rights like other ‘capitalists’. Establishment institutions often take a dim view, as exemplified 146

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in 2000 by the Mumbai judge who commented: ‘Rewarding an encroacher on public land with a free alternative site is like giving a reward to a pickpocket.’24 It is important to understand that the argument here about this route to homeownership is not that it is a panacea, nor should it be romanticised. It is not an ideal process for anyone, as millions live, perhaps for all their lives, without formal recognition or adequate services. Many are cheated of their claims at crucial points. Shifts in political control and ideological nuance can delay the process (or speed it up). Millions have been – and are still being – evicted and their homes destroyed at various times and in various places when regularisation is not in vogue or has fallen out of favour locally. Those on relatively well-located and nonhazardous land (e.g. not on a very steep slope or in an easily flooded area) are increasingly under threat from property and infrastructure developers (as are those in well-located public housing in the GN) who do whatever they can to avoid or flagrantly ignore local legislation about compensation and rehousing.25 Peripheral land is increasingly rarely ‘free’ or very cheap, if it ever was. The system generally cannot deal with slum settlements, often well-established ones, where most of the housing is for rent and, along with the land, is owned by absentee lessors, many of whom may be wealthy members of the city or national elite. The increasing hegemony of neoliberal capitalist ideology everywhere militates against regularisation remaining a central element of the urban ‘social contract’ in GS societies. Nonetheless, for very large numbers and extensive areas of residential urban land, it is now a done deal. There is no doubt that these processes, for all their manifest faults, are the main reason why homeownership rates can be very high in developing countries. This is particularly so in Latin America, where upgrading policies originated. Available current data show that more than half of all urban households say they own their home, and renting is far less common than in parts of urban Asia or Africa. In Argentina, Guatemala, Costa Rica, Brazil, Peru, Panama, Paraguay, Nicaragua and Venezuela, 70% of households were classified as owners in 2012.26 This figure includes houses in settlements still regarded as ‘informal’, but the pattern is nonetheless clear. UN-Habitat’s 2012 State of Latin American 147

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and Caribbean Cities report states that the ‘forced evictions of the past have been left behind. The informal city has come to enjoy a kind of de facto security of tenure.’27 The forces that led to the creation of so many informal settlements are also petering out: fertility has dropped dramatically, with several countries, including Brazil, at below-replacement levels; rates of urbanisation are so high that rural–urban migration no longer plays much of a part in urban growth; and large-scale land invasions have thus also largely ‘been left behind’.28 Upgrading and regularisation mean that nearly all households have access to electricity in urban areas. Conditions in informal and regularised settlements may not meet the standards of ‘decent’ housing in the GN, but nor are they generally so bad as to still be considered ‘slums’ according to the broad definition of this term by UN-Habitat. Between 1990 and 2014, the proportion of the urban population in Latin America living in ‘slums’ so defined fell from 36% to 21%.29 ‘Solving’ the housing dilemma via the route of informality and eventual regularisation is generally a feature of urbanisation in the GS even though the structural causes – the unaffordability of legal, planned alternatives – are also found in the GN. It is often pointed out that informal settlements could still emerge in parts of European cities in the twentieth century, such as the bidonvilles of Paris, or various small squatter settlements around Lisbon. The ways in which such settlements in Lisbon arose on peripheral rural land were possible because they were ‘not yet a space subject to urban planning mechanisms (legislation, surveying, zoning, etc.) as such … [Any individual site] was prone to hidden occupations, tacitly accepted by the state who “turned its eyes” away.’30 The parallels with informal settlement mechanisms in the rural peripheries of cities in the GS are exact. Nonetheless, the capacity and commitment of GN institutions to prevent unregulated use of land have been greater, partly because the societies are wealthier, which is both a cause and effect of such institutional features. Thus, such settlements have usually been cleared, although in Lisbon the demolitions are still continuing. Also, the numbers involved have been very small in comparison with informal settlements across the GS. In Paris, for example, there were around 35,000 in about 100 different bidonvilles in 1966, many 148

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of which housed immigrant construction workers.31 Settlements eventually regularised in GS cities house, or come to house, a crosssection of types of relatively poor families and households. Many may be migrants, although increasingly many have been born in the city, but the migration involved was mainly internal. Most importantly, ‘illegal’ settlements in the GN are not likely to be regularised. However, if peripheral private landholders are prepared to play their part, it can happen. The irregular settlements in Texas, the colonias discussed in Chapter 3, have some similarities with the processes of informal settlements being incorporated into ‘the city’ in the GS. As Peter Ward has described, these can also become ‘“[s]lums of hope” … such that between fifteen and twenty years after their establishment they have … often become integrated working-class districts with paved roads, services installed, and consolidated dwellings, many with two storeys.’ As in the GS, this is ‘urbanization by stealth’.32 As described, in Texas the process involves (Texan) farmers with large, low-value, semi-arid landholdings selling parcels of land, mainly to dodgy developers. Precisely similar circumstances led white South African farmers in the latter years of apartheid to become ‘shack farmers’, renting out land to black African migrants who needed somewhere to live within commuting distance of a city;33 the process is now spreading to more valuable farmland.34 In Texas, it has allowed for the development of the sort of consolidation so familiar to cities of the GS.35 For the developers, the cynical recipe for them to profit requires a range of ‘ingredients’ including land that is ‘close enough to but at the same time away from the city where building and development activities are not readily noticeable’; advertising, but ‘not in a nearby city’; hope that ‘by the time there is [official action] … the colonia will likely be completely sold’; when pressured by the state to provide the legally required infrastructure, ‘declare bankruptcy because of the high cost of improvements’; and finally, ‘relocate to another city’ to start again.36 As Ward emphasises, the structural underpinnings of this situation in Texas are ‘low-wage employment … widespread poverty and the inability of either the public sector or the private notfor-profit sector to match demand [which has] led to settlement 149

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development which shares many of the characteristics of that in developing countries’.37 In essence, the problem is ‘a shortage of decent, safe and affordable housing options’.38 Families living in the colonias have work in a Texan town, but their wages are not ‘sufficient to sustain access to formal land and housing … provided by the market’.39 The very negative official turn against immigrants in the USA under the Trump administration has also seen these settlements face cuts in funding for upgrading40 and become targets for searches for undocumented immigrants.41 The reluctant and slow processes in Texas compare unfavourably to the situation across the border in Mexico. Colonias there may be built on ejido (smallholder cooperative) land, where there is some similarity in terms of legality to the tenure situation on indigenous land round many African cities. According to Ward, the ‘proactive and responsive nature of Mexican policy makes for both more effective and more economical solutions to the dilemmas posed by colonias … [which] are viewed as a self-help response to a chronic housing shortage in the rapidly growing border region’.42 Accepting ‘quiet encroachment’ and incorporating settlements into cities in Mexico has led to the country having one of the world’s highest rates of homeownership, at about 80%. Upgrading has also led to major reductions in the share of urban populations defined by UN-Habitat as living in ‘slums’. In 2014, this was 11%, having halved from 23% in 1990.

Sidestepping informality: the site-and-service approach to homeownership A subsector of the process of regularisation are housing schemes known as site-and-service, which were introduced in Chapter 2 with reference to Zimbabwean housing projects of the 1980s and 1990s. There is an extensive literature on this housing ‘solution’ for developing countries, reflecting the excitement about what appeared to be highly progressive and pro-poor policies in the 1970s.43 They grew out of the recommendations about upgrading and recognising informal settlements. In essence, the idea was to utilise the savings and investment potential of even the poor that was evident from

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the development of such settlements (although this potential was small, sporadic, slow and entirely unsuited to ‘orthodox’ housing finance), and to set aside specific areas around cities as ‘sites’ for self-help housing. This cut out the ‘difficult’ informal phase before regularisation occurred, and, crucially, for the state it meant control over where low-income settlements developed. It also meant that there was no threat of eviction: the settlements were ‘formal’, legal and planned. In theory, it also allowed the provision of important infrastructure from the start, so residents were never faced with unsafe water and sanitation or a lack of schools, clinics and other public infrastructure. During the 1970s and into the 1980s, the idea seemed to be working in many cities across the GS. However, it still involved considerable public-sector expenditure on the purchase of land, planning and infrastructure. It also ‘worked’ best for the target population (the lowest deciles of the income distribution curve) when subsidies were provided for purchasing building materials and other necessary expenditures for formal housing, even when people themselves were building the homes. The schemes allowed ‘incrementalism’ whereby homes were constructed gradually; indeed, this was essential. However, as time went on and the neoliberal ethos of cost recovery asserted itself as the 1980s passed, the costs imposed on ‘beneficiaries’ rose. High building standards, sometimes commensurate with ‘decent’ GN housing standards, could be imposed. As described in Chapter 2 for the case study of unaffordable housing in Glen Norah C in Harare, Zimbabwe, efforts were made to involve private-sector financing in the loans to build houses, which strengthened the requirement for ‘high’ standards. Service payments for the infrastructure provided edged up to cover costs. In the end, the reasons why ‘incrementalism’ made housing affordable for those on market-set low incomes often dwindled to the point where the supposed target populations could not afford the schemes. Such schemes have continued in various cities at various times. They can work, but they are tricky to get right. Pitch the costs too high, as the neoliberal turn tended to, and they do not achieve the mooted pro-poor outcomes. Pitch them too low – as some African states, impoverished by Structural Adjustment Programmes in the

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1980s and 1990s, tried to do, providing nothing but a pegged (legal) plot in a site far away from work opportunities, and then trying to charge for it – and there is not much, if any, advantage for the poor over ‘quiet encroachment’ in a better-located area.

Transferring public housing to homeowners Another state policy that bucks the market and has provided very significant homeownership for ordinary urban households in both the GN and the GS has been to transfer public housing stock en masse to the current tenants, for free or for very little cost. It is discussed in comparative housing reviews but often almost in parenthesis, perhaps because, once done, it is non-replicable. Evidently, it is only significant in its impact in societies with a history of large-scale public rental housing. Its ideological appeal is ambiguous. On the one hand, the (first) beneficiaries are generally on low incomes since they occupy such housing. It is therefore pro-poor, in a sense, and it is certainly not a ‘market’ solution. On the other hand, it represents a truly astonishing transfer of public wealth to private hands. The value of the already serviced land and, to a lesser extent, the buildings was on the balance sheet of the state and might have been used as collateral. Now it belongs to private households. That appeals to the theoretical ideology of pro-market, privatising advocates in some ways, although most would probably prefer the transfer to have been done in ways that specifically benefit large-scale private developers (as with regeneration projects). Their argument would be that that would be more ‘efficient’ (although it is not, of course, for the tenants). Eliminating state management and maintenance costs also appeals to neoliberals. It is crucial to note that the transfers under discussion in this section are avowedly not about the gradual sale of public housing to tenants by pro-market governments. That is discussed in the next chapter as one of the housing processes that ‘unsquares the circle’ of addressing housing affordability. The policy here relates to sudden change involving massive and rapid transfers with very high subsidy rates, a policy that has emerged in various parts of the world at critical junctures of political transition. These include South Africa, 152

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Zimbabwe, Namibia, eastern Europe and the Soviet Union, and China. Given the ideological ambiguities discussed above, there is not necessarily clear water between all the motives involved in these countries and the more gradual shifts driven by neoliberal capitalist vested interests. There are key differences, however, in terms of scale and, crucially, relative inclusivity and the nature of the impact on affordability. In South Africa, the process was initiated with the 1990 Greater Soweto Accord, which included an agreement to ‘transfer houses to the people’. As discussed in Chapter 5, public rental housing in townships had played a pivotal role in the apartheid agenda. As that era came to an end, there was a short period in which policies for redistribution and redress had some purchase. Sitting tenants in black African, Coloured and Asian townships could apply to buy their houses at highly subsidised rates;44 very long-standing tenants paid little or nothing. Households in the site-and-service schemes that had emerged towards the end of the apartheid era could also apply. By 2005, half a million households had had ownership transferred.45 The policies mirrored those implemented in Zimbabwe in 1980, where a similar history of injustice and denial of rights to the city saw tenants of the formal townships purchasing their houses on a rent-to-buy basis, with a sliding scale of costs reflecting length of tenancy. Those who had been renting for 30 years received their houses free. This created almost overnight an African urban homeowning stratum. The pace of change was astonishing. By 1985, 78% of family housing units in Harare were held under homeownership agreements, reflecting the great popularity and far-reaching impact of this scheme. In Namibia, by 1989, 53% of designated rented units in townships were converted to ownership in a similar scheme. After independence in 1990, tenants in formal African and Coloured townships could buy their houses for a nominal fee of 200 rand if they had rented them for 20 years. By 1993, about half of the houses in Katutura, the main township for the capital city, Windhoek, were already privately owned.46 In the former communist states of eastern Europe and Russia, very highly subsidised, and very sudden, transfers of public rental housing to tenants also occurred after 1990. Between 1990 and 153

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1993 in Hungary, for example, just over a third of public housing was transferred with subsidies of 60% to 85% of market value.47 Ten of the world’s 15 top-ranked countries by rates of homeownership are in this group, all with rates of 80% or more (although in the more rural states that also reflects the very high rates of homeownership that are fairly typical of rural areas globally). Russia comes ninth with a rate of 84%. Two of the other top-ranked are Singapore and Mexico, for the (non-market) reasons explained earlier. In 2014, 95% of households in Romania and 67% in Slovenia owned their houses outright, so housing costs beyond maintenance and service charges are no longer part of their budgets.48 In simplistic terms, in these countries where nationalised housing meant that there was no urban housing affordability dilemma (albeit there were other housing issues), despite the sudden shift to capitalism in the 1990s, the emergence of free-market-set prices for urban housing was forestalled by the decisions to transfer en masse at prices subsidised to the point where most sitting tenants could buy. This means that their urban housing situations remain atypical for GN states. In turn, housing costs and tenure issues are unlikely to dominate the budgetary and family life decisions of urban households in the way they do in the rest of Europe or North America. These are fundamental differences. China is the final significant example, although its situation is more complex. In part this is because its system of controlling internal migrants’ ‘rights to the city’ – which had some parallels but also key differences with the situation in white minority-ruled southern Africa – was retained in important respects throughout the period when public rental housing was being transferred. Its rate of urbanisation has also been among the highest the world has ever witnessed since the 1980s, meaning that the numbers of urban ‘outsiders’ are in the hundreds of millions. This refers to migrant Chinese citizens with a hukou registration not local to the city where they live and work. They have few, if any, rights to public-sector housing in these cities, let alone to benefiting from the transfer of such housing, and they face the housing dilemma in the same way as urban workers in much of the world. Nor is the option of ‘quiet encroachment’ followed by state recognition realistic in a state with such capacity 154

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and determination to control urban outcomes. The people who did benefit from China’s shift from communism to state capitalism – and hence changed housing policies – were urban ‘insiders’ who, as in the African, European and Russian examples above, were housed in public rental housing at very affordable rates. Workers for state-owned enterprises (SOEs) were often housed by their work unit. In 1981, urban housing tenure in China is estimated to have been divided as follows: 53% in work unit housing, 29% in municipal housing and 18% in private-sector housing.49 As in the Soviet Union, the public housing was often overcrowded but it was extremely cheap. Rents were often around 1–2% of incomes.50 From the 1990s, the government began to implement policies to transfer public housing to homeownership; these were greatly accelerated in 1998 when ‘welfare housing’ of the old sort was basically ended.51 The extraordinary outcome for ‘urban insiders’ was a shift from over 80% renting in the public sector in 198052 to 88% homeownership in 2013.53 This has been accompanied by a major increase in average floor space per person in this accommodation.54 There were various schemes that enabled this transformation for the tenants, most but not all of whom would have been on low incomes. A Housing Provident Fund into which workers and SOEs have had to pay since 1991, modelled on Singapore’s scheme, played a part, but since then it has been mainly used for purchases of new housing. It had 100 million contributors in 2012.55 However, the key was that for ‘employees of urban state-owned enterprises, government agencies and other state and better-off collective work units … their employers or the housing bureau were offering them advantageous terms’. Generally, they also ‘had little choice in the matter’.56 There were many factors influencing the level of subsidy but the sales came ‘with a huge discount’.57 As in southern Africa, the longer the ‘urban insiders’ had occupied public housing (often therefore relating to length of work service for the state), the larger the discount. Seniority (and thus age) was ‘rewarded’. Larger households with more needs also got larger subsidies. Wealth was not the key issue, although inevitably it played its part. Even in the most expensive and ‘desirable’ cities, ordinary insiders benefited. As early as 2000 in Beijing, Tianjin, Shanghai and Chongqing, officials, professionals 155

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and ‘staff members’ had already achieved homeownership rates of 60–70%, but so had 40–50% of production and service/commerce workers. Similarly, 60–70% of those with degrees were homeowners but so were 40–50% of those with no education, or only primary or junior high school.58 In all these examples, the sheer scale of subsequent homeownership proves the affordability of these one-off policies. But subsequent urban households cannot benefit from similar policies although those who inherit their parents’ property stand to gain. The cohort issue is important: being a tenant in the right place at the right time. However, population growth is now slow in many of these societies due to very low fertility levels. Populations are ageing in China, Russia and eastern Europe. The demographic pressure for new housing units is less than in the past and many families now have access to owned homes. With the exception of Zimbabwe and Namibia, most of these countries are now mainly urban. However, in China and southern Africa, due to in-migration, urban populations have risen relatively and absolutely to a considerable extent since the transfers occurred. This means that in southern Africa the fortunate cohorts are very much in the minority and in China millions of internal migrants have been excluded from these processes. The urban housing dilemma is therefore still highly problematic for many. Yet population dynamics can have other interesting side effects. The one-child policy in China may allow the families of those who benefited from the housing transfer programmes to accumulate housing. Victor Li, writing for the Asian Development Bank in 2016, noted that, ‘[s]ince 2000, the post1980s generation born under the One-Child Policy has entered into marriageable age’ and predicted that, ‘[a]s intergenerational family wealth is passed down in terms of housing, urban couples may face a situation in which they will have more than one housing unit, thus leading to substantial vacant housing’.59 This chapter and the preceding two have explained how the intricate mixes of formal and informal, rented and owned, private- and public-sector housing gradually emerged across the urban world in the twentieth century. Each country and its major cities have their own characteristics and history that have shaped the outcomes but 156

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general features can be identified in the broad sweep. The tackling of slum conditions in the GN took decades because a true determination to deal with the underlying issue of assuring access to housing affordable for those on low incomes did not emerge until after World War Two. Subsidised public rental housing was a key policy at that time, or strongly regulated private-sector rental housing, and often a mix of both. In the communist world, housing was generally provided by the state at affordable cost, although space was often squeezed and access to urban housing was affected by controls on mobility. The impacts of colonialism and its associated general lack of government interest in the housing conditions of the majority of urban workers, with or without their families, set the scene for significant expansion of informal and inadequate housing in GS cities. Once independence was achieved, urbanisation often accelerated. Since the urban workforce and governments tended to be much poorer than their counterparts in the GN, policy options were more limited. In any case, most governments tended to follow the legacy of colonial housing policies and focused their direct financing on housing for the middle classes and civil servants with occasional flurries of demolitions in particular informal housing areas. As the numbers housed informally around major cities often reached into the hundreds of thousands or even millions, through various processes of ‘quiet encroachment’, many governments eventually took note of the possibilities offered by housing policies such as in situ upgrading and site-and-service settlements, which built on the existing housing investments of the poor and ideas of self-help. Swathes of informal housing have been recognised and regularised across the GS, allowing greater security for homeowners, but not for renters, and the potential for improved infrastructure. In some GS societies, homeownership was also boosted by transfers of public housing to tenants. All of these processes were problematic. There were winners and losers at every turn. Had different policies been followed, the outcomes for affordable housing in the world’s largest cities could have been better (but they might also have been worse). Part of the task of the last three chapters has been to explain how these housing outcomes evolved during the nineteenth and much of the twentieth 157

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centuries, especially for those on low incomes, rather than what might or should have been. Although millions of housing units were ‘delivered’ that people on low incomes could afford, everywhere the housing dilemma remained – the formal private sector could not and would not house those on low incomes – and in the GS the poorest struggled to be safely and decently housed. Slums and homelessness remained major problems. There was nonetheless a broad acceptance, which had taken decades to achieve, that the public sector had to intervene in urban housing because of the housing dilemma. In the last two decades of the twentieth century, that acceptance changed and urban housing affordability issues were soon to take on crisis proportions.

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Chapter 7

Global finance, big cities and unaffordable housing

Introduction In 1980 the UK passed a new Housing Act that allowed publicsector rental housing to be sold to tenants at a considerable discount.1 The Act was a herald of a seismic shifting in the postwar social contracts between the state and the people that had underpinned access to affordable ‘decent’ housing, and many other types of welfare provision, across the Global North (GN). This was the shift to neoliberal ideologies with its mantra of ‘rolling back the state’ and promoting market forces in the allocation of resources. Whereas, as explained in the previous two chapters, earlier decades had seen the emergence of various ways in which the housing dilemma could be tackled (squaring the circle), now these ideologies unleashed a series of changes in cities worldwide that began ‘unsquaring the circle’. Particularly in large cities with the strongest roles in globalising capital, the impacts on the affordable housing landscape have been extremely negative. This chapter explains how this ideological turn and the underlying forces of ‘big’ capital have sought deliberately or have otherwise tended to undermine housing affordability in large cities, frequently reversing the achievements of past housing programmes. This includes how many current policies presented as tackling the demand for 159

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low-cost housing are increasingly meaningless for those in need of such housing and often cynical ploys by state actors and property developers to divert attention from the real beneficiaries, who tend to be wealthy. In addition, previously affordable housing areas, if well located, are increasingly not protected against the powerful capitalist interests that seek to replace them. The policies that had achieved so much in making urban housing affordable had always been in danger. Under a capitalist mode of production there are powerful forces ranged against the delivery of formal affordable city housing for those on low incomes due to the inherent preference to rely on market forces and the private sector. Resistance to the idea that the state must necessarily intervene is long-standing in capitalist societies. The USA’s first national public housing legislation of 1937 could only overcome resistance in Congress by stating that a key aim was to reduce unemployment by stimulating the building industry and that the legislation ‘was never conceived of as providing long-term permanent housing for the poor’.2 As noted by Peter Ward in 1999, ‘the federal government has shied away from public supply of housing; indeed public housing is stigmatised in the United States’.3 Yet the relative strength of this resistance does vary and, as the last two chapters showed, significant provision of affordable housing by the state (or recognition of unplanned affordable housing) has occurred at different times and in different cities across the world. The neoliberal turn from the 1980s, however, meant that the ideological and profit-motivated opposition to direct state help for low-income housing became increasingly assertive. At first sight, the UK’s 1980 Housing Act might not appear to be an obvious example of ‘unsquaring the circle’. Surely helping people in poorer groups to buy their previously rented homes from the government is pro-poor? Certainly, this is how the UK policy was justified and promoted. The previous chapter also discussed the state-subsidised transfer of PRH to sitting tenants in a range of formerly communist countries and white settler states in southern Africa as one element among the ways in which poorer households have afforded homeownership. Indeed, newly independent Zimbabwe introduced its own similar policy the same year 160

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as the UK. However, as explained, the underlying motivations were very different. In Zimbabwe there was a moral premise involved, of righting a historical wrong, and during the 1980s government policy there bucked the global drift towards reduced state intervention (although it eventually succumbed, for a while, in 1991). The historical context is crucial. Nonetheless, the motivations for such transfers and sales are not easily ideologically disentangled. There can be no doubt that the shift away from communism to state capitalism and the abolition of bans on private property in China provided the necessary backdrop to the view that mass PRH was no longer necessary or desirable. The same was true in Russia and eastern Europe. Yet, as argued, the scale of PRH and of the subsidies involved were such that vast numbers of low-income people also benefited. It did, therefore, help to ‘square the circle’, for a time at least. The process was not set up to be discriminatory. On the other hand, wherever it occurs, privatisation of the PRH stock is not a sustainable approach to the housing dilemma, since once it’s sold, it’s gone. The removal of millions of PRH units in countries as diverse as China, Latvia and Zimbabwe means that, for those who were not in the right rental unit at the right time, their chance of being housed at truly affordable rents in public housing has radically diminished. Future generations and low-income households in the same cohort are pushed firmly into the private sector (or must squeeze in with their more fortunate relatives), although the scale of these issues will be influenced by city-specific population growth and inheritance patterns. Some sitting tenants may not have been able to afford even the extremely highly subsidised purchase prices and found themselves pushed out, although the evidence in countries such as these is that most were able to benefit. The context of the introduction of PRH sales in the UK under Margaret Thatcher was a society at the forefront of the neoliberal turn. The sales were part of efforts to reduce ‘reliance’ on state welfare and promote privatisation. The policy certainly benefited some tenants but it signally failed the obvious real ‘pro-poor’ test in terms of its impact on housing affordability more generally and in the longer term. This was because its main intent was to shrink the public housing sector rather than to help the poor. The provision of public 161

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housing was mainly within the remit of local governments, which in the UK’s largest cities were usually left-wing and in favour of public housing at the time, but their funding and powers to replace the council housing lost through sales were curtailed by the Thatcher government. For example, local councils received only half of the proceeds of the sales, with the rest going to central government, and they had to use that money to reduce their debt levels rather than build new PRH for new cohorts of low-income households.4 Within seven years, a million public-sector housing units had been privatised; by 2015 the total was 1.8 million. This is one reason why the problem of housing affordability for ordinary working people, now including many in the middle classes, in Britain’s large cities became one of the dominant issues in contemporary politics and media headlines. But introducing PRH sales was only the start of the process of unsquaring the circle, a process that has now been working through public and private sectors worldwide for nearly 40 years.

Commercialising the priorities of public housing authorities Since the implementation of neoliberal values and policies was associated with the political shifts brought about in the GN by the elections of Ronald Reagan in the USA and Margaret Thatcher in the UK, analysis often starts with these societies. However, these were functioning and very wealthy democracies and the resources committed to welfare and the embedded nature of institutions addressing the housing dilemma were going to take some time to unpick. In such circumstances, the full realisation of the impacts can be like a slow-onset natural disaster. Neoliberalism’s effects were more swiftly evident in countries far away from its origins, which were poorer, weaker and unable to negotiate or slow the imposition of the new policies of privatisation and market pricing. They virtually became experimental areas where the GN could watch what happened when the state was ‘rolled back’. Sub-Saharan African countries that were heavily indebted after the oil shocks of the 1970s and thus forced to borrow from the World Bank and IMF, newly under the influence of the neoliberal 162

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‘Washington Consensus’, proved to be the least able to defend their poor against the experiments or the outcomes. During the 1980s and 1990s there was an outpouring of research and analysis of the impacts of so-called ‘Structural Adjustment Programmes’ (SAPs): rising death rates (particularly for children), falling school enrolments, collapsing health systems, accelerated informalisation of urban economies, de-industrialisation, and massive increases in poverty rates.5 Researchers in Africa knew all about broken cities and ‘unsquaring the circle’ long before really serious problems began to arise in the GN, therefore. Although urban housing issues looked very different in the Global South (GS), the structural and ideological forces at work had many parallels. Malawi was one of the first countries to suffer a series of SALs (structural adjustment loans). It was, and remains, one of the world’s poorest countries. In 1980 it was a one-party state ruled by an idiosyncratic, right-wing and socially conservative president, Hastings Kamuzu Banda, who had been in power since independence in 1964. He was a favourite of the ‘West’, being staunchly anti-communist. The vast majority of Malawi’s urban population could afford very little indeed in terms of housing. One of the president’s post-independence priority plans was to build a new capital city at Lilongwe, in the Central Region. This was a ‘garden city’, built to a plan devised by an apartheid-era South African company, which, unsurprisingly, was highly segregated (by income) and distinctly not pro-poor. Lilongwe’s ‘image’ was important to Banda, so planned low-income housing had to remain ‘invisible’ to visitors and wealthier residents, and for many years informal and unplanned housing was very restricted.6 Yet out of this somewhat unpromising set of circumstances an experiment in the provision of affordable, planned housing for the very poor emerged. It took on board the arguments in GS housing circles about affordability for the poor. The low-income settlements devised were site-and-service schemes known as Traditional Housing Areas (THAs). Building standards were set according to public health rules;7 they were lowcost and low-technology and indicated a real effort to adapt to the extreme poverty characteristic of that country’s urban population but maintain basic health standards. Sun-dried bricks8 (but not 163

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wattle and daub) and beaten earth floors were permitted, and this allowed the poor a real chance to take advantage of the schemes, build something affordable and gradually, probably over many years, upgrade their houses. Earth roads, pit latrines and water provision from kiosks (one per 100 plots) further reduced costs and increased potential replicability. The THAs were the responsibility of the Malawi Housing Corporation (MHC) as an agent of the government, which was meant to bear all related costs. By 1982, Area 25, the largest of several THAs in Lilongwe, housed 15,000 people. However, the 1970s debt crisis and the demands of neoliberal SAPs for reduced government expenditure meant that funding began to dry up and the MHC could develop only housing schemes for wealthier groups where cost-recovery was possible. By 1982, the government allocated no money at all for THAs and no more were developed. At that point squatting was still very strongly discouraged, so the poor crowded into the existing THA houses and small rental units built on the edges of housing plots. Health and environmental problems multiplied as overcrowding within the THAs increased rapidly. The latrines could not cope. In one THA, a third of residents were living on plots with more than 21 other people. Basically, slums had been created out of schemes that, in their early years, ‘might be considered in some respects a model for such developments’.9 The MHC was struggling with other issues too. It was not meant to subsidise middle-income housing schemes but the government imposed rent controls and would not pay economic rents for civil servants living in such housing. While this might be interpreted as a failure by the central government to allow the public housing institution to function, the problems ran much deeper. The key issue was that typical incomes, even of the ‘middle classes’, were often too low for market rents for ‘middle-income’ housing. The housing dilemma was everywhere. As previously explained, in such situations, were civil servants to pay economic rents, the government would have to pay those rents or increase their wages, increasing expenditure either way. Yet that was forbidden by the SAPs’ conditions. Low incomes and an increasingly informalised urban economy, with urban food insecurity soaring in Malawi’s main towns,10 were the real problems. As Ben Kaluwa, a Malawian 164

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housing analyst, explained in 1994, in theory ‘cost-recovery rentals in the higher income housing subsectors [could] provide part of the cross-subsidies required … in the upgrading of squatter settlements’, but in reality that required ‘parallel measures … to raise the affordability levels of the low income or the unemployed through employment schemes’.11 Through the power of conditional loans, international neoliberal finance forced Malawi’s housing projects to shift their fundamental aims and priorities in similar ways to those described in Chapter 2 for Zimbabwe. By the 1990s, new site-and-service schemes made no pretence to be pro-poor but were aimed mainly at middle-income groups to improve cost-recovery rates. These ‘intermediate’ THAs in the country’s two largest cities had MHC-designed cores: prebuilt ‘starter’ elements. The cheapest had three rooms. Eligibility for the schemes was not for those below a certain income but for those above a minimum income, which entirely excluded anyone in ‘the group classified as low-income’. Monthly repayments exceeded 40% of average household incomes in the cities.12 This example from a deeply rural country in the GS has been deliberately used to demonstrate the global nature of the structural changes that have been exacerbating the housing dilemma in the neoliberal era. At first sight, it might seem unlikely that the fate of Malawi’s THAs was tied up with that of the UK’s complex mix of PRH and housing benefits, but the parallels are substantial. Throughout the world, similar shifts in ideology, institutions and funding patterns have negatively affected the parameters of affordable urban housing. Schemes that were working, producing and managing housing which was affordable for those on the lower deciles of the income distribution were put on the back burner, or, as in the case of the UK, actively dismantled. The trend in Malawi to a focus on higher-cost housing in order to achieve better cost recovery or even to generate income for the public institutions mandated to provide housing is mirrored exactly in other societies. There can be no presumption that urban ‘policy travel’ necessarily occurs from the GN to the GS; the forces of globalisation can be ubiquitous, driving simultaneous developments even in what may seem unlikely comparators. 165

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The commercialisation of local housing authorities’ priorities, as in Malawi, was almost inevitable given the ideological changes in central governments and reductions in funding for low-cost housing. In the UK, one aspect of this was to shift much of the responsibility for ‘affordable’ housing from elected local governments to housing associations (HAs). These institutions originally had their roots in the philanthropic interventions by, for example, the Peabody and Guinness Trusts, which had helped provide some reasonable-quality affordable housing in the late nineteenth and early twentieth centuries. In the post-war decades, with the emergence of council housing en masse, the various forms of HAs which had developed continued to play some role in affordable housing provision, with some government funding, but their role was relatively minor. Their institutional characteristics were highly attractive, however, to the ideological aims of neoliberalism, which included reducing ‘government’ deficits. HAs were defined by the government as NGOs.13 If the costs (debts) associated with providing ‘social’ housing could be transferred to HAs, the government’s deficit was reduced. So, from the 1980s, this is what happened. Of course, the reduction was apparent, not real, but such financial sleights of hand, which also occurred with so-called ‘private finance initiatives’ in other sectors, which allowed short-term falls in ‘government’ expenditure at the cost of higher expenditure in the future, seemed to satisfy the ideologues in government as proof that the state was being rolled back. In the ‘affordable’ housing sector, the financial aspects of the shifts to HAs were, again inevitably, accompanied by changes in the ideology and values characterising HAs. Gradually they shifted from being pro-poor and promoting social and community welfare to increasingly espousing, and implementing, the values of profit-driven private-sector organisations. Rents became less affordable for the groups the HAs were ostensibly meant to serve. New housing projects began to seek to make profits, often justified on the grounds that this would allow more such projects. However, this is not much help to low-income groups if the projects cannot house them. The governance of the associations began to slide out of the hands of those who had the interests of the

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poor at heart to those for whom self-interest and commercial values predominated. Similar shifts in elected local government authorities also began to occur. A key reason was the impact of unfunded mandates on the nature of decision-making and the electable pool of decision-makers. In the housing sector (and most other sectors), local governments had a slew of statutory mandates to fulfil but less and less money as central government grants dwindled and tax cuts were enforced. Elected officials thus began to face the unenviable prospects of largely presiding over endless cuts to services, including housing; the increasing impossibility of properly monitoring housing regulations, thereby allowing ‘decent’ standards to be undermined by cost-cutting and greed; and the soul-destroying business of deciding who, out of the many with great need, might be allocated what was left of affordable housing. Such circumstances produce feedback loops that affect the sort of people prepared to stand for local elections and their subsequent hiring decisions. Although many local politicians with pro-poor values soldiered on, the outlook of local governments’ housing departments, as with the HAs, was becoming more profit-oriented. The outcomes of the changes for the construction of new affordable housing were shown in Figure 2.2 in Chapter 2: council completions rapidly collapsed over the 1980s and then virtually ceased and HA production has been small. Some reductions in new building might well have occurred had the former political dispensations continued, because, by the end of the 1970s, the UK had at last solved the housing dilemma: there was no great shortage of housing affordable by those on low incomes.14 The populations of many large UK cities, including London, were also declining at that point. However, with the existing stock of affordable housing suddenly being reduced through sales and the new drive to cut government expenditure wherever possible, this moment soon passed. As the various subsidies from central government that underpinned the formerly affordable rents in council and housing association housing were cut, rents in PRH escalated and shortages soon reappeared. Between 1981 and 1991, council housing rents increased by 55% in relation to average earnings.15

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The reductions in the availability of truly affordable housing inevitably caused the re-emergence of major housing problems, particularly in cities where populations were growing, which soon included London again. The fundamentals of the housing dilemma had not altered: households on low incomes still could not be decently housed by profit-seeking providers, be they private or public. The inexorable forces of market logic also began to undermine the neoliberal ‘achievement’ of homeownership for poorer groups via PRH sales. As the privatised homes were sold on, at market prices, their ownership began to shift towards the middle- and highincome groups with the capacity to compete in unsubsidised housing markets. Forty such houses were found in 2013 to be owned by the son of Ian Gow, who had once been Thatcher’s housing minister,16 a situation which, had it occurred in a housing project promoted as pro-poor in a developing country, would arguably have been immediately deemed as evidence of ‘corruption’. If all this were not proof enough of the intransigent nature of the housing dilemma, an even more ludicrous aspect of this reversal was that many such homes are bought by private landlords who rent them back to poorer groups. In London in 2013, 36% of PRH that had originally been sold to former tenants was rented in this way. Worse still, the rent was sometimes being paid by the councils that had formerly owned them, as they struggled to fulfil their basic mandated housing priorities. Understandably, this was regarded as ‘incredibly poor value for money to taxpayers’ since it drove up the housing benefit bill.17

Middle-income poaching, downward raiding, regeneration and gentrification In the UK, the 1980 Housing Act was often referred to as the ‘Right to Buy’ scheme (for former low-income tenants), but, as explained, it is being reshaped by market forces as a ‘Buy to Let’18 scheme that benefits wealthy people. Thus, a project promoted originally as a scheme to help the poor has become part of the problem, rather than part of the solution to the housing dilemma. The rightful indignation of many British commentators about this situation is understandable but most miss the point that the tendency for piecemeal housing 168

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projects that subsidise home ownership to be ‘raided’ by income groups for which they, ostensibly, are not intended is commonplace across the world. In the literature on low-income housing projects in the GS, it has been identified as a major problem for decades and is referred to as middle-income poaching or downward raiding. Various factors can be involved but the motives are powerful and obvious: the acquisition of capital assets at below-market prices and thus swift accumulation of wealth. Rigorous monitoring of purchasers and regulations of subsequent sales can help. Setting maximum income limits (means-testing) for ‘beneficiaries’, as purchasers of subsidised housing are usually called in the GS, is a marker that the project has some real pro-poor credentials. Nonetheless, the political and financial (bribery) power of wealthier groups may still be used to ‘poach’ some allocations. The death knell for housing projects termed ‘low-income’, in terms of being actually affordable for the poor, can come if the ethos of privatisation shifts eligibility criteria to include a minimum income that would allow ‘beneficiaries’ to pay for some elements of private-sector financing (and associated higher standards of housing), rather than the maximum incomes in early schemes to try to ensure that allocations favoured the truly poor. The combination of all these factors in Glen Norah C, the housing project in Harare, Zimbabwe described in Chapter 2, meant the scheme was ‘poached’ by middle-income city residents. Having muscled in on the state subsidies involved, some then rubbed salt in the wound by renting them out to the poor, a family to a room, thereby undermining the ‘decent housing standards’ promised by the scheme and profiting from the rents. The parallels between the Zimbabwean experience and the example of the eventual outcomes of the UK’s Right to Buy programme are evident, although purchases by UK landlords to rent are not straightforward ‘poaching’ since they have not benefited from the original state subsidy. The underlying problem is the same: households with low incomes cannot suddenly find that they can ‘afford’ market-priced housing. Since significant levels of subsidy are needed for poorer groups to attain monetised ‘demand’ for housing in many large cities, the closer the costs are to market levels, or once they revert to these, the more the poorer groups are priced 169

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out. Thus, the gradual transformation of the UK’s ‘Right to Buy’ to ‘Buy to Let’ should have come as no surprise. It was foreseeable and forecast by the experiences of thousands of housing schemes in the GS as well as the GN. The urban world is littered with housing schemes that have been justified by governments and donors as helping the poor to rent or buy ‘decent’ housing with legal tenure but which are way beyond their means. If later analysis demonstrates that they have largely failed to reach the ‘intended’ beneficiaries and have been poached by wealthier people, the policymakers involved may act concerned but very often the outcome must have been known and even deliberate. In such cases, their promotion as policies to tackle the housing conditions of the poor might be termed ‘poor-washing’. Real misunderstandings about the levels of income allocable to housing, once other even more necessary expenditure is accounted for, may also affect outcomes. However, household income data, which are increasingly available even for the world’s least developed countries, minimum wage levels or even ‘back-of-the-envelope’ calculations can work out how ludicrous the gaps are between housing costs in some schemes and what many households (and in some cities in the GS, most households) could possibly pay. In Addis Ababa, for example, the government has a longstanding scheme of building condominiums, ostensibly to address the housing conditions faced by the poor. This housing was subsidised but remained completely out of sync with the realities of urban livelihoods. Income and rent data published in a 2009 World Bank report19 showed that, in 2007, rents were 800–1,300 birr per month for one-room ‘studio’ flats up to mid-sized apartments, and very much more for larger ones. Yet the monthly wage for a typical skilled labourer was only around 400 birr, so even a studio cost double that. The rents also exceeded the entire monthly wage of the best-paid skilled labourers lucky enough to be working in formal employment for a large private contractor. Using the exchange rates of the time, one can calculate that this was equivalent to arguing that a scheme in which the very cheapest possible rent for one room was £2,100 per month was somehow going to help those on low wages in London. Nonetheless, the World Bank report stated 170

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that ‘the evidence that the housing component of the program has not been pro-poor has been disputed’20 – this despite the fact that the World Bank itself had found in an earlier 2005 study that a studio would be unaffordable for 85% of Addis’s population. Yet the generosity of the scheme was criticised by The Economist a decade later in 2017, when it noted that the government had recently had to ‘hike’ rents or mortgage payments because ‘the prices charged by the government were too low to sustain the programme’. The Economist pointed out that this now meant that ‘poor Ethiopians cannot afford the down payments for even the most subsidised units. Those who can often struggle to pay their mortgages. Many opt to rent out the flats and move elsewhere.’21 Of course, in reality the unaffordability of the condos for those in need of better housing was long established, it had just become much worse. The political choice eventually to opt for higher levels of cost-recovery has been a typical feature of many ‘affordable’ schemes as neoliberal values became entrenched in global urban policy circles, meaning that they veer ever further from solving the housing dilemma and closer to being part of that dilemma. Yet, all too often they are still typified as schemes that address low-income housing issues, providing a fig leaf for the governments involved, which, whether cynically or not, do not wish to admit that they are really doing very little to help the poor into decent housing. The Ethiopian policies have mirrored trends long established elsewhere, such as the Malawi case discussed earlier. In 2013, a new Ethiopian scheme was ‘explicitly aimed at the middle class – those who could afford down payments of 40%’.22 It also allowed the wealthy who could pay cash for the entire property to skip the allocation process. Furthermore, The Economist noted approvingly that officials were discussing ‘moving away from public provision and … allowing foreign firms to participate in the housing scheme’, and that ‘[b]oosting the amount of land available to private developers might also help’. The trajectory of the condominium scheme and its analysis is like a caricature of the trends in ‘affordable’ housing policies in both the GS and the GN in the neoliberal era, with the commitment to effective subsidies dwindling; middle-income, or even really rich, groups being unfairly advantaged, at first perhaps 171

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covertly but eventually often explicitly; and private finance being pushed with suggestions that perhaps the government might like to subsidise those investors. Ethiopia just got into the narrative rather later than most, due to its peculiar political history whereby it went straight from feudalism to Marxism-Leninism in 1974, then to a more mixed but still strongly state-controlled and authoritarian political economy in 1991. Another flagship ‘new-build’ (rather than site-and-service) housing scheme in Nairobi has also attracted much attention because it is publicised as addressing the shocking housing conditions of an infamous adjacent slum, Kibera. Nairobi also houses the headquarters of UN-Habitat, so there was a serious image problem. The flats built for the scheme certainly look modern and ‘decent’. Nonetheless, it was blindingly obvious to most housing analysts that if a household was so poor that they had ‘chosen’ to rent a room in Kibera, with virtually no sanitation in often decrepit dwellings, there was no way they could afford a ‘decent’ flat and pay for electricity and piped water unless the subsidy was enormous. And so it proved. For example, in one area of the project, known as Canaan, it was reported in 2017 that half of those allocated flats there in the previous year had left. Some had sold; others were renting out their flats at market rates and had moved into accommodation they could afford, including back in Kibera.23 Similarly, a 2016 review of the shift away from ‘enabling and participatory approaches’ related to upgrading and regularisation of informal settlements and towards ‘mass-scaled supply-driven approaches to housing provision’ in Angola, Namibia and Ethiopia found that they all proved unaffordable for their presumed ‘classes’ of residents. Eventually their prices or rents had to be heavily subsidised by the state,24 with potentially problematic debt implications for the future.25 A recent flagship government housing programme in Cameroon was also found by the World Bank to be unaffordable for 80% of the population.26 Angola’s housing projects have experienced similar problems. This country has sub-Saharan Africa’s third-largest economy and experienced extremely high economic growth during the decade-long global commodity boom from 2003. In the capital

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city, Luanda, there are five large-scale Chinese-built peripheral high-rise housing projects (centralidades). The most well known, Kilamba, was begun in 2008, and ‘shown off to visiting dignitaries as a social housing flagship project’. The cheapest three-bedroom apartment, however, cost $125,000 and the project became widely known as a ‘ghost city’ as so few could afford to live there, even in one of Africa’s most resource-rich states. Nor was it helped by the fact that it was a ‘two-hour drive to [downtown] Luanda on crowded and potholed roads’.27 In 2013, costs were subsidised and reduced to $70,000, which proved sufficiently affordable for some of the middle classes, some on a rent-to-buy basis, and by 2015 over 70,000 people were living there. Yet 40% of those renting to buy were struggling and had defaulted on their payments in the two years prior to 2017.28 For the vast majority of Luanda’s much poorer inhabitants, the centralidades are irrelevant, except inasmuch as they ‘diverted housing investments from those most in need’ and from far more effective investments such as ‘the upgrading of slum areas, musseques, where about two-thirds of Luandans lived, with poor or no access to basic services’.29 As the values and priorities on which low-income housing policies were built have shifted since 1980, poor people living in ‘desirable’ locations, reasonably close to city centres or good transport, nice views, beaches, employment opportunities and the various emblematic elements of liveable cities have sometimes also been faced with the double whammy of being threatened with removal and at the same time having this publicised to themselves and the wider urban community as being beneficial to themselves. This is regeneration. Regeneration in cities can obviously occur without involving low-income housing areas, when private finance buys up non-residential land and redevelops it for profit. As city geographies evolve, however, areas occupied by low-income groups when the housing there was affordable (and ‘undesirable’) or by PRH, or was ‘squattable’ and perhaps eventually regularised in GS cities, can become extremely valuable. There can then arise a formidable alliance of private- and public-sector forces to oust the unfortunate residents and build some new mix of commercial and residential

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properties, in order to realise the sometimes quite astonishing profits. Regeneration is also good fun for architects and planners who get to play with their skill sets in what may be a high-profile new urban setting. The process is far from new: Haussmann’s wholesale redesign of inner-city Paris in the nineteenth century displaced thousands of slum dwellers who were not rehoused30 and many slum clearances throughout history have provided highly profitable development opportunities for those with finance. However, the contemporary promotion of privatisation and private finance has re-energised the process and provided a more encouraging urban policy landscape. Surges of wealth and economic growth (if not development) in different cities across the world, as globalised capital’s demands shift,31 have also fuelled sudden rounds of evictions in cities in countries as disparate as China, India, the UK and Nigeria. Many evictions followed by redevelopment may make no pretence about helping the poor to relocate, although much may be made of how dreadful their housing conditions were, as though having no housing at all is preferable; the danger they presented to the health and security of the rich is also much publicised as ‘justification’. But where social activism, democratic institutions or social norms are sufficient to prevent the most egregious excesses, compensation offers for property owners are more likely to be part of the process. Renters are usually disregarded, often even by analysts of evictions, even though they may be the majority of those affected, as tenancies can be terminated, usually quite legally. However, property owners are never fairly compensated so that they could buy a similarly sized property in the same area post-regeneration, as then the profits realisable would be significantly reduced. Shifting people into high-rise accommodation frees up land for other profitable developments, but those involved in regeneration usually seek the highest possible use value from all their land. On many sites that means commercial properties plus high-end residences. Furthermore, while regenerators prefer to build housing suited to rich people because that is more profitable, more insidiously they often also want to remove the original residents permanently in order to socially engineer the area, presuming that their preferred occupants do not want to live in socially mixed areas. 174

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In terms of numbers, Chinese urban residents have been most affected by city redevelopment schemes (although large-scale evictions occur for various other reasons too). Shanghai witnessed the eviction of 2.5 million in the ten years between 1993 and 2003, with 40 million square metres of old housing replaced by new high-value buildings. In Beijing, highly publicised ‘regeneration’ evictions occurred when 400,000 were evicted before the 2008 Olympics, their old housing replaced by ‘shopping centres, office buildings, exclusive residential buildings and sports facilities’.32 In this type of eviction, for those with legally constituted rights to their previous residence (thus excluding the so-called ‘floating’ population of labour migrants whose lack of ‘rights to the city’ goes far beyond housing), the Chinese government ‘generally compensates and relocates evictees’, but they ‘are usually moved to less valuable land that is further from urban centres and transportation options than the original location’.33 For those who need to earn a living, this can be near disastrous: job opportunities are almost bound to be far fewer, if any, and more poorly paid in the new location and the monetary and time costs of commuting to their old jobs may make it uneconomic or simply impossible. In addition, the immeasurable value of what are often very long-standing social networks for all those evicted is destroyed. The shift in attitudes and policies towards low-income residential areas in Mumbai, India, during this century precisely exemplifies how neoliberal values are serving to ‘unsquare the circle’ of the many policies from earlier decades which had done something to protect the affordable housing of the poor. These included regularisation of some informal settlements, recognition of the importance of community participation for upgrading slums, and some legal recognition of poor people’s housing rights, including the right for those who could prove their residency to before the late 1990s (cut-off dates varied) to be rehoused if ‘slum’ demolitions occurred. In sum, although very poor housing and threats to low-income settlements remained common, many of the measures discussed in Chapter 6 that helped retain the key feature of affordability could be identified. In 1997, the Indian Supreme Court even ‘specified that it was the state’s duty to construct houses at 175

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reasonable rates and make them easily accessible to the poor’.34 In December 2004, however, as the journalist Anu Kumar explained, in Mumbai the government began a ‘demolition drive’ that within two months had destroyed: 70,000 shanties they claimed were illegal, clearing in the process as many as 306 acres of land, dislocating over 3 lakh [300,000] people and affecting thousands of others. It … went against the grain of what the Congress promised in its election manifesto in … recent assembly elections – to protect slums built before 2000 – a promise widely believed to have garnered electoral support among Mumbai’s poor.

Kumar traces these actions back to when ‘Bombay First, an organisation with representatives from the corporate world, asked the consulting firm McKinsey to prepare a comprehensive plan that would turn Mumbai into a “world-class” city by 2013’. This was urban neoliberalism writ large. As is often the case, the clearances were cynically advertised as ‘working towards the upliftment of these citizens of our metropolis’.35 By 2009, developers ‘from around the world’ were submitting plans to redevelop Dharavi – ‘labelled as “the largest slum in Asia”’36 – the settlement made famous by the film Slumdog Millionaire. Its residents are all too familiar with the threats of ‘development’ (see Box 7.1). The current plans for redevelopment of the land thus vacated would mean ‘developers stand to make huge profits’ and the government between $2 billion and $3 billion. Residents from before 2000 with claims to the land on which their property stood were likely to be rehoused on-site, in high-rises, although there was much contestation over attempts to reduce the size of their flats. But tenants, labourers housed in workshops and post-1999 residents would simply be evicted.37 In one area a survey found that this meant 63% had no rights to rehousing. As yet, Dharavi still stands, as global tendering for its redevelopment has been unsuccessful, but new rounds of plans are regularly produced,38 so its residents’ futures are uncertain.

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Box 7.1 Fighting for their rights: the communities of Dharavi Dharavi is largely built on land reclaimed over centuries from marshes, with land ownership divided between the municipality, central government and the private sector. While emphasising the resilience and enterprise of its residents, the journalist and author Kalpana Sharma reminds us ‘that there is nothing to celebrate about living in a cramped 150 sq. ft house with no natural light or ventilation, without running water or sanitation. No one should have to live in such conditions.’ Dharavi has seen many rounds of housing policies: ‘[e]ach successive government in Maharashtra has drawn up its own plans for slum redevelopment and low-cost housing’. These have reflected the ideologies and fashions of the times and some of those in the past have been reasonably progressive in their (ostensible) aims. Yet the threat of evictions for various parts of the settlement has arisen again and again, leading sometimes to effective community action. One such community organisation is PROUD (the People’s Responsible Organisation for a United Dharavi), which draws its membership from areas across Dharavi. In 1980 it formed the PROUD Land and Housing Committee. One of its first acts was to submit a memorandum to the local municipal office, ‘starting with the slogan DESH HAMARA, DHARTI HAMARI, DHARAVI HAMARI HAI [This country is ours. This land is ours. Dharavi is ours.] and demanded … No demolition of any hut/house in Dharavi.’ One slum rehabilitation scheme promised in 1995, the Free Scheme, was soon mired in controversy: ‘the minister of housing accused the bureaucrats who worked under him of insubordination … Officials in the bureaucracy in turn accused the ministers of populism, saying that the Free Scheme was (continued)

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(continued) not economically viable. Housing activists … accused the state of having a hidden agenda.’ The activists were only too well aware of the threats of ‘development’ for people in places such as Dharavi, knowing that they ‘can become valuable properties once they are developed, leading to houses passing from slum dwellers to middle-class people … [A] large proportion of the built-up slum area will rise in value, and slum dwellers will be unable to afford the maintenance costs of apartment buildings … [T]he hidden agenda … [was suspected to be] to clear the area of slum dwellings, thereby accomplishing what government-organised demolitions could not.’ Sources: Sharma, K. 2000. Rediscovering Dharavi: Stories from Asia’s Largest Slum. New Delhi: Penguin; Chatterji, R. 2005. Plans, habitation and slum redevelopment: the production of community in Dharavi, Mumbai. Contributions to Indian Sociology, 39, 2, p. 214.

In London, regeneration in inner-city areas with long-established large-scale PRH has also become a major threat. The public–private alliance required is often between corporate developers and Labour councils, a painfully ironic outcome of the city’s electoral geography whereby areas with large PRH estates (‘suitable’ for large-scale, globalised and hugely profitable regeneration plans) are more likely to vote Labour. However, as the ideological shade of councils has shifted due to the many constraints imposed by the wider neoliberal environment, some councillors have proved all too willing to negotiate with corporate developers in the twenty-first century. Southwark Council and the Australian property developers Lendlease eventually succeeded in evicting the last resident of the Heygate Estate in Elephant and Castle in 2013, after a long legal battle against the plans by social activists. Three thousand people lost their homes. Owners (who had bought under right-to-buy legislation) were expropriated by the government with compensation, but nothing like what was needed to buy in the same area. The last evictee owned a 178

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three-bed home. A replacement in the new development would cost £1 million but he was offered compensation of only a quarter of that.39 The developers were meant to provide 35% of the new residences built at so-called ‘affordable’ rents but managed to reduce this to only 3%. Nearby, residents in Southwark’s Aylesbury Estate have battled similar eviction notices but the phased scheme was nearing completion in 2019.40 In Haringey in north London, another Labourrun council promoted with Lendlease an even more ambitious deal, the Haringey Development Vehicle (HDV), which would demolish two council estates called Northumberland Park and Broadwater Farm. The planned redevelopment was estimated to be worth £4 billion.41 The HDV met with such stiff opposition from local people, fuelled by the broken promises of the other regeneration projects in south London, that the project was stopped. The worryingly close relationship between the public and private sector in regeneration schemes was suggested when Haringey’s council leader resigned in early 2018 and then joined Pinnacle, a housing management group that had been among the private-sector bidders for the HDV. Another process undermining the availability of affordable housing for low-income households is gentrification. At first this was mainly identified – and hotly debated in academic circles – in cities in the GN.42 It generally involves an increase in the market valuation of private homes in an area that had been reasonably affordable. The price rises are caused by increased demand from wealthier groups. The process is gradual because residences can be bought only when former residents choose to sell on the private market. Market ‘churn’ then changes the nature of the neighbourhood to reflect the consumption patterns of the new, wealthier incomers. Pricier and fancier restaurants, bars and shops begin to appear, replacing long-standing cheaper ones that had fitted the needs of the poorer residents. In short, the class nature of the community shifts. For the existing poorer residents who have no wish to move and often have deep social roots in the area, the process can be very negative as local living costs increase. Property owners, however, stand to benefit when they sell, although only if they move somewhere not similarly gentrifying. However, new lowincome households can no longer buy into the area as it has become 179

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unaffordable. Private-sector tenants are worst affected, as usual, because rents inevitably rise (unless strong regulations exist and are implemented), pricing out both existing and prospective tenants from lower-income groups, thus hastening the gentrification of the area. In the GN it happens mainly in large cities with relatively thriving employment markets, particularly for young professionals. From London to Sydney, Vancouver to Berlin, gentrification gains ground, as does active resistance from local civil society groups trying to protect the dwindling pool of affordable accommodation. In San Francisco it has transformed the city, largely driven by huge housing demand from skilled tech professionals often working in Silicon Valley. In cities such as Barcelona the problem is slightly different, being driven by tourist-related demands removing many rental units from the pool available to local people, forcing their rents upwards. Some city authorities have enacted measures to slow the process, for example in German cities including Berlin, although this may be targeted at ‘cultural’ areas of significance for tourism, which feeds the city’s coffers. Gentrification is somewhat different from the other processes ‘unsquaring the circle’ for affordable housing because it is not about demolitions or regeneration per se, nor does it involve middleincome poaching of new housing projects aimed specifically (in theory, at least) at providing affordable housing for low-income households. It is about changes in the affordability profiles of existing, and often quite old, neighbourhoods. Importantly, it is not characterised by direct state housing subsidies, designed to help poorer people, ending up in wealthy pockets. It is primarily a result of private-sector forces when there is a shortage of housing in the areas ‘traditionally’ affordable to middle-income groups, for whatever reasons. Not being faced with the hard constraints of the housing dilemma due to impossibly low incomes, they do not need the state to subsidise their housing and instead seek out housing they can afford in areas previously deemed too unfashionable for their needs. Nonetheless, the broader city landscape of state interventions in housing markets does shape the geography and speed of gentrification. A regeneration project, for example, once

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begun, may mean that market prices increase in surrounding affordable areas. Recent efforts to contribute to a ‘worlding’ of urban studies and theorising have attempted to draw comparisons between the various ways in which housing that was previously affordable to poorer groups can become unaffordable. These studies suggest that perhaps these processes might all usefully be considered as gentrification. They include comparative analysis of cities as disparate as Abu Dhabi, Athens, Cairo, Cape Town, Lagos, Lisbon, Puebla, Rio de Janeiro, Seoul and Taipei.43 In some cases the processes fit the bill, but some are more about regeneration schemes. One aspect of this ‘worlding’ of affordable housing studies has served to bring more attention to a ‘wicked problem’ playing out in the thousands of previously ‘illegal’ settlements in and around GS cities, which, as detailed in Chapter 6, have played such a significant part in providing truly affordable housing and then creating millions of legal urban homeowners when they have been recognised and upgraded. This is the unfortunate fact that legal tenure and improved services, and general upgrades to building quality, can usher in the same sorts of market forces that characterise gentrification. Households a few deciles higher up the income distribution who would probably never have dreamed of seeking housing in an illegal, insecurely tenured settlement, with poor sanitation, begin to see the regularised settlements as possible places to live. Properties also become desirable rental assets for investors from outside the area. Thus, the process of house price and rent rises begins, pricing out families who initiated the settlements as well as tenants for whom low rents were more crucial than services and who never stood to benefit from the introduction of private, registered property rights. Indeed, for such tenants, who can be the majority of residents, such rights can be disastrous as the very lack of secure tenure for their local lessors hinders the reach of the city’s commercialised, legal housing markets into their neighbourhood. Yet for decades the mantra of many housing experts in relation to cities in the GS was that security of tenure was the way to include ‘slums’ and squatter settlements into the city fabric and make them part of affordable housing solutions. UN-Habitat emphasises the

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importance of secure tenure and identifies its lack as a key marker of ‘slums’. The provision of secure tenure is usually well-meaning and felt to be pro-poor and welcomed by homeowners. This is why it is a ‘wicked’ problem – a conundrum that is very difficult to solve. Its impact is geographically uneven, affecting settlements closest to work opportunities and city amenities and with attractive features such as views. Thus, homeowners in legalised settlements can become ‘well-placed’ if they are well-placed. A classic example, characterised by Jake Cummings as ‘favela chic’,44 is the gentrification of some of Rio’s most favourably sited favelas. One lesson from this – that what is good for homeowners and lessors is not necessarily good for tenants – is familiar enough to those who remain alert to the heterogeneity of interests found within such settlements and how class issues affect outcomes. Original homeowners, who may have seen the value of their asset soar, can also eventually find themselves under pressure from large-scale property developers if their area is targeted for regeneration or ‘transformation’ projects. This has happened, for example, since 2000 in some of Turkey’s often vast gecekondu: formerly informal, urban suburbs.45 But there is a wider truth involved, central to the argument of this book. Again, it demonstrates how the lowest-income groups in large cities will always tend to find that they cannot live in reasonably located, legal, ‘decent’ housing when market forces set the rules and prices. Thus the gentrification of some formerly illegal settlements can be seen as markets ‘rectifying’ the ‘anomaly’ of poorer groups owning (and renting) housing assets they cannot really ‘afford’. Middle-income poaching, downward raiding, regeneration and gentrification are all forces that tend to exacerbate the housing dilemma by making housing that should be, or was, affordable for low-income households unaffordable or even disappear. Alongside the influence of neoliberal ideologies on the availability of properly funded public-sector housing programmes more generally, there were thus many processes reasserting or maintaining the housing dilemma worldwide from the 1980s. However, in 2008, the housing dilemma itself helped trigger the financial catastrophe that made things much worse.

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The subprime mortgage crisis and the 2008 financial crash: catastrophic feedback loops In 1973 President Richard Nixon of the USA attacked ‘the underlying assumption that the basic problem of the poor is a lack of housing rather than a lack of income’.46 Nixon may seem a rather unlikely political figure to have asserted this crucial point, and his reasoning was based on a desire to cut federal spending rather than sympathy for the plight of the American poor. Nonetheless, the recognition that housing affordability rather than supply was the issue and that the private sector could only produce reasonable housing, whether for purchase or rent, at a cost beyond the reach of many Americans on low incomes was notable. But it was a lesson that was to be fatally ‘unlearned’ in the following decades. The global ‘moment’ when the hard constraints of their inherent unprofitability became all too evident occurred with the 2008 subprime mortgage crisis in the GN, mainly in the USA, which almost brought down the world’s financial system and ushered in a recession in Europe and North America that was worse than that of the 1930s.47 The associated opaque and frantic repackaging of mortgage debt obligations, which were then sold on, is sometimes seen as ‘the problem’ but in reality this was only an irresponsible diversionary tactic that delayed the inevitable crash. The crash was caused by ‘big capital’ trying to square the circle of housing unaffordability by lending money for the purchase of millions of homes that people could not afford. Neoliberal ideas had successfully promoted the deregulation of financial sectors on both national and global scales since 1980. This was justified as being more ‘efficient’ – regulations were said to hinder the creation of wealth.48 The regulations relating to housing finance had been there for good reasons, however – they prevented bankers lending irresponsibly. These began to be unpicked. In the USA, the Garn–St. Germain Act in 1982 ended regulations for house loans that had meant that borrowers had to have enough money for a deposit and the principal had to be repaid within 30 years. In 1999, the Glass–Steagall Act of 1933, which had separated investment and commercial banking to stop banks

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gambling with their deposits, was also repealed. While the USA was always ahead of the pack, deregulation of housing finance was occurring throughout the GN, as a Bank of England report noted as early as 1991. That report was already ringing alarm bells about possible long-term impacts.49 Financial institutions and their employees soon changed their lending norms, making ever more imprudent loans (subprime mortgages) to poorer and poorer people, some with irregular incomes or even no apparent income at all – so-called NINJA loans (No Income, No Job, No Assets) – as described, for example, in the book (later a film) The Big Short.50 That account demonstrated that the view, frequently repeated after the crash, that no one had realised how insanely dangerous all this was for the global financial system was unsupportable. The voices of reason about this (other) ‘inconvenient truth’ were, however, in the minority and were blithely ignored by the financiers, mainly because they were making obscene amounts of money. Subprime mortgages in the USA accounted for a fifth of loans made in 2005 and were valued at $625 billion, compared with $35 billion in 1994.51 While banks previously had to bear the costs if they lent to people who were unlikely to be able to pay their mortgages, deregulation meant that they could avoid these responsibilities by selling such loans on to investors around the world,52 deliberately disguised among others debts. The value of these repackaged loans (collateralised debt obligations or CDOs) was estimated at $7 trillion in 2007.53 Greed drove the system, combined with a perception by those selling on the exceedingly risky repackaged loans that they would not bear the consequences.54 They were right: the pain was to be suffered by others. When the financial crash finally occurred, the sheer scale of the unpayable debts accumulated by the irresponsible lending for house purchases made possible by the deregulation fostered by neoliberal ideology became apparent. Governments in the GN were terrified: the private banks could not possibly cover their losses and the consensus was that if they went bankrupt en masse the whole world would face an economic depression as bad or worse than in the 1930s. So the governments pumped colossal sums of money into the private financial sector to keep it afloat. In the USA it is estimated 184

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the cost to taxpayers was $1 trillion; in the UK £137 billion.55 The implicit federal guarantee of the debts of crucial American housing finance institutions such as Fannie Mae became explicit as they were (re)nationalised.56 The financial sector did not collapse, so that was averted, but the globalised recession that ensued was a disaster, and in some countries it lasted longer than that of the 1930s. Millions of jobs were lost – 8.8 million in the USA alone by 2009. Millions lost their houses – around 7 million in the USA. The economic pain spread across the world and has not ended. So the reality of the housing dilemma reasserted itself in dramatic fashion – a very painful feedback loop that almost destroyed the global economy while proving that insisting on a market-based ‘solution’ to providing decent urban housing for lower-income groups57 is irrational and downright dangerous. Yet the impacts on livelihoods and housing difficulties to be faced by the poor, and now an increasing number of those on average incomes, were only just beginning, as five further feedback loops set in. Having bailed out the banks, the debts of governments in the GN soared – in the UK from 36% to 57% of GDP in the two years to July 2009. The second feedback loop was that these governments then chose to impose severe austerity measures on their societies. Thus, the issues of the unaffordability of housing and the housing dilemma were translated into massive cuts in public services and welfare payments on the grounds that these had now become ‘unaffordable’. The targets varied from country to country, but could include health, education, unemployment and income support, pensions, environmental protection, prisons and parole services, any type of regulatory bodies and, inevitably, support for low-income housing programmes. Taken together, these are the types of social investment that had, as part of the post-war social contract, made the lives of ordinary working, unemployed and retired citizens and their dependent family members in GN societies different from those in GS societies where mass informality in employment is often the norm, frequently in extremely precarious self-employment or family enterprises with irregular and very low incomes, because no work can mean destitution. As explained in this book, this was also true of housing: various combinations of mass investment in public housing, 185

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regulation of ‘decent’ standards, rents and tenure, and monetary support for housing costs where needed set the housing situation of poorer urban citizens of the GN apart from their counterparts in the GS. All this came under attack. The third feedback loop emanated from the neoliberal ideology and values that had set up the deregulation of financial sectors and fostered the egregiously risky behaviour of those selling housing loans. The strongest adherents to that ideology dislike virtually any kind of government expenditure unless they perceive that its absence might undermine capitalism and reduce profit levels. This is often based on short-term evaluations, disregarding the fact that the benefits for private enterprise of healthy(ish), educated, reasonably housed populations need to be understood, in ‘means of production’ terms, as stocks that take at least a generation to develop and amass. These take time to diminish but cannot easily or quickly be replaced if not maintained. The financial crash and the subsequent advent of austerity provided the ideologues with an opportunity to cut health, education and welfare programmes, and militate for further privatisation of public services, to extents that they could not previously attain. All this could now be dressed up as being unfortunate but necessary due to the impacts of the housing crash. So, while the neoliberal phase of capitalism had been rolling back the state steadily since the 1980s, now the processes were given a massive boost. The impacts on people’s health and education and access to income support and public and advisory services, including legal aid, have been shocking. In the housing sector this allowed for the acceleration of processes that had been in train since 1980 and which were already undermining programmes promoting housing affordability. In the UK, for example, the central government cut its grants to local governments by about two-fifths and imposed caps on the amount by which they could raise local taxes. This very effectively slashed local services and reinforced the trend for local government representatives to becoming mere overseers of cuts and espousing the necessity of privatising public-sector assets to raise short-term funds, precisely as the architects of neoliberalism hoped. The more recent regeneration projects in London, including the proposed HDV, exemplified these changes. At the end of 2017, 186

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the UK government announced that it would halve what remained of councils’ grants. As the Local Government Association argued, this was an existential threat for what remained of some services.58 Similar shifting of financial responsibilities for affordable housing elsewhere result in a smug central government with a lower bill to pay and a series of harried local governments slashing housing services. City governments with significant autonomy and revenueraising abilities can consider housing policies and investments that are impossible for other cities without these features and thus are (or were) highly or entirely reliant on central government grants. Generally, however, any reduction in public subsidy overall will make the dilemma worse – a family evicted because rent subsidies are being cut or because a regeneration project is demolishing their block of flats is just as homeless whether this has reduced the deficit of central or local government. The fourth and fifth feedback loops worsened the housing dilemma yet further and extended it to income bands beyond those primarily affected before the crash. The first was that real incomes fell; the second was that housing costs in many large cities soared. These two are partly related but the fall and then stagnation of real incomes in the GN were due not only to the inflationary impacts of house prices. Pay in the UK was still lower in real terms in 2017 than before 2008, and the wage squeeze experienced over that period was the worst since the Napoleonic Wars, over 200 years earlier. The Institute for Fiscal Studies anticipated that real pay levels equivalent to those before the crash would not be re-established until 2022.59 According to the Resolution Foundation, the combination of ‘more than £12bn of [further] benefit cuts’ to be implemented from 2017 onwards and falling incomes meant that the deterioration in the situation until 2022 for ‘the poorest third of households’ would be worse than in the years immediately after the crash.60 The sixth feedback loop from the crash was caused by the adoption of long-term ultra-loose monetary policies by governments as part of their efforts to prevent economic recession, going beyond the initial costs of ‘saving’ the financial sectors. By providing unprecedented amounts of government-backed bonds at extremely low interest rates, the aim was to provide investors with ultra-cheap 187

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finance to encourage economic growth and production and employment creation. This was partly successful, although recessionary conditions did still occur in countries in both the GN and parts of the GS for varying periods, and the time taken for employment levels to recover has been very varied. Some countries in southern Europe in particular still have very high unemployment. Real wages and productivity levels have been very slow to improve, even where unemployment rates have fallen, as in the UK and USA. In the USA, labour-force participation rates also fell and then stuck at a low of around 63% for the period 2014–19. The strategy has also had many undesirable outcomes. The relative profitability of different types of secure assets in which wealthy investors might park their capital and watch it grow shifted dramatically because the interest rates yielded by government-backed securities plummeted. These types of investors therefore sought to buy other types of assets they deemed secure and profitable. Unfortunately for the ordinary citizens of those of the world’s largest cities most firmly embedded in the global, financial circuits and practices that had helped trigger the financial crisis, their housing sectors turned out to be one of the main asset classes that such investors chose as a replacement. Many other large cities with successful economies and growing populations of young professionals, often in information technology industries, could also be targeted. As the radical geographer David Harvey argues, the regular and inevitable crises of capitalism usually lead to investors seeking a ‘spatial fix’ to redress the accompanying falls in their profits.61 This time around, part of the fix drove up property prices in particular cities. So, although house prices crashed after 2008, the selective demands of footloose capital meant that they quite soon rallied in urban centres judged to provide potential high returns in real estate. And then they soared. Wealthy overseas investors tended to focus on high-value, high-status neighbourhoods and expensive new-build apartments, often in trendy locations. Yet they did not need to live in them to achieve their investment aims. In London, for example, the phenomenon of empty or only occasionally occupied apartments and houses in its richest quarters has been frequently criticised in the media, occurring as it does in the midst of a housing affordability 188

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crisis for most of the city’s residents.62 However, as such housing is available only to those in the top band of the income distribution, the effect is indirect, through ripple effects on prices down the housing market generally and possibly by diverting land and building investment away from housing types that would be more affordable for other income groups. A more direct impact may have been caused by an explosion in the purchase of buy-to-let houses, often by more local capitalists, encouraged by specific government tax policies in the first decade after the crash, the rise in the renter population and the search for safe and reliable income yields. This final feedback loop triggered by ultra-loose monetary policy has had effects throughout the world beyond the realm of housing. From around 2017, small upward movements in central bank interest rates began, but there remained much uncertainty about how the world economy would react to ‘normal’ conditions given the fundamental changes that have occurred. The American president, Donald Trump, who had been a property developer, soon began to attack the USA Federal Bank and its officials for even the very small inroads made into the easy access to cheap investment money that had been fuelling the post-crash financial party for many, at the cost of the welfare of most. By 2019, interest rate cuts were already occurring again and many financial pundits were voicing concern about unusual shifts in key financial indicators, including negative interest rates for cash holdings in some institutions. In 2017, Merryn Somerset Webb of the Financial Times pointed out that the extraordinary economic circumstances of the past years were in danger of being forgotten: Nearly a decade [on] … we remain firmly in the crisis that securitisation created … [E]very time we think we live in remotely normal times … remember that in 2009 the Bank of England cut rates to the lowest in its 315-year history … [The] chief economist of the Bank of England reckoned in 2015 … that rates were (and still are) the lowest they have been for around 5,000 years … Record low-interest rates have … created asset price booms across the board in a bonanza for those already well off enough to take the risk of investing – in stocks, bonds and housing … Be ready for a repeat of sorts: there is trouble bubbling up.63 189

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Two years later, in July 2019, dissatisfied with economic growth and investment returns in the Eurozone, there were calls from the world’s largest asset manager, BlackRock, for the European Central Bank to print money and buy equities (as had long been happening in Japan). Somerset Webb was swift to point out how this was part of an ‘ongoing shift towards increasingly bonkers monetary bazookas’ to benefit investors across the world – it was ‘naked selfinterest’. Furthermore, she noted, although ‘global elites have a full-on meltdown’ whenever there is any suggestion of using quantitative easing or other major public expenditure to help the poorer members of society, in essence they were now proposing that ‘the only way to save capitalism is to begin to nationalise it’.64 Lawrence Summers, a former US Treasury Secretary, characterises the postcrash state of capitalism as secular stagnation, a situation in which ‘private investment is manifestly unable to absorb private savings even with negative real interest rates and limited restraints on financial markets’.65 Analyses such as these, setting out the underlying contradictions at the heart of capitalism, are critically important and usually heard from Marxists and other representatives of heterodox economics (as distinguished from the orthodox neoclassical economists who dominate policy circles).66 The fact that occasional commentators from the bastions of financial capital are also drawing attention to these issues perhaps serves to illustrate the increasingly critical nature of the economic challenges faced by the world today. This chapter has argued that there is a malign synergy between contemporary capitalism and housing issues. First, a refusal to accept the hard limits on capitalist profits set by the housing dilemma nearly broke the world’s economy. Second, many of the forces of the contemporary era of neoliberal capitalism have served to undo, challenge or undermine the policies and urban processes that had helped to ‘square the circle’ of the unaffordability of housing for households in low-income brackets. They have broken the cities. They continue to do so. The outcomes for ordinary urban citizens in the cities most affected have been profoundly negative.

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Chapter 8

Broken cities: unaffordable housing as the norm?

Introduction The combination of the application of neoliberal ideologies to urban housing policies and the financial crash reshaped and continues to reshape how many large cities are experienced by their residents. In many such cities in the Global North (GN) the trend is towards housing outcomes without the crucial mitigating influence of largescale public subsidies targeting those whose incomes exclude them from decent provision by the private sector. The scale of the housing dilemma is on the rise, sucking larger shares of residents in big cities into the crisis of affordability and all its associated suffering. Its reach creeps up the income distribution bands, affecting households on incomes that would previously have been insulated against the hard truths of mismatches between the costs of ‘decent’ housing and market-determined low wages. Indeed, as has long been the case in much of the urban Global South (GS), in large GN cities even those on median incomes, and some of those above them, are facing these truths, so the idea that it is confined to poorer sections of the urban population in such cities becomes questionable. The once seemingly safely presumed differences between housing issues in the GN and the GS are starting to blur. Or rather, given that these

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differences existed only for a relatively short time in the long history of global urbanisation, they are starting to re-blur. The rising tide of unaffordability was illustrated in the UK in May 2016 when the British Broadcasting Corporation (BBC) published an online article entitled ‘“Sky-high” rental hotspots across England revealed’, which included an interactive tool to find out ‘how affordable is rent in your area’.1 Taking the often used 30% of (take-home/post-tax) earnings as the guide to an ‘affordable’ rent, it showed users what proportion of rental units of various types would be affordable in the area they sought to live in. The accompanying article used Office for National Statistics (ONS) data on wages and private-sector rents. It demonstrated that no one in the lower half of the wage distribution in London – 50% of wage-earners – could afford to rent even a studio flat (except in one outer borough). In half the city’s boroughs they could not even rent a room in a shared house. With a few exceptions, nor could they afford a one-bedroom property throughout the whole of the southeast of England. The situation described was comparable in many ways with that so often described for cities across the GS, where it is taken as read that most cannot afford the housing provided by the formal private sector. So were some of the outcomes. The article quoted a policy manager for the campaigning group Generation Rent who argued that, in this region, ‘the only option for average earners is to squeeze themselves into ever more crowded flat shares. This might work for some, but it’s a completely unsustainable solution for anyone who wants to settle down.’ Subsequently, the BBC regularly produced articles with links to interactive maps for both renting and buying affordability across the UK; these are updated as new data become available. Within the original article, four features of the contemporary housing dilemma in Britain since the financial crash and its accompanying disastrous impacts were identifiable. In Chapter 2, ONS data and analysis from the campaign group Shelter and the political group Labour Left were used to introduce and illustrate the scale of the housing dilemma in the UK. Yet, as the BBC article showed, the housing crisis is so fundamental that its analysis, provision of relevant data and dissemination of how commonly it affects working 192

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people – not ‘just’ the unemployed and pensioners – are now in the public sphere. Housing (un)affordability is a constant theme in popular media: television, online, newspapers and magazines. In response, although housing has always been a political football, now it is big politics. A second feature, therefore, has been the establishment of new campaigning groups such as Generation Rent and PricedOut.2 The term ‘Generation Rent’ is also used widely in the media to refer to the significantly increased share of younger adult cohorts who find themselves unable even to contemplate house purchases, and who are ‘condemned’ to renting for the foreseeable future – and often, should they stay in the cities where incomes are (seemingly) highest, throughout their lives. These two groups focus on very different aspects of the crisis. PricedOut is only interested in house purchase, and its proposed solution is the standard one presented by much of the media and government: ‘build more homes and reduce the cost of decent housing’.3 Generation Rent campaigns for private tenants, seeking ‘professionally managed, secure, decent and affordable private rented homes in sustainable communities’, and has a deeper understanding of the crisis. It points out on its home webpage that private renting in the UK doubled in the decade to 2008; that this sector is ‘now where a majority of under-35s live’; and that the ‘Mayor of London was elected [in 2017] after calling the election a referendum on London’s housing crisis’. A third characteristic is the uneven impact of the crisis, both geographically and demographically. By 2018, prices for twobedroom properties were unaffordable for those with nationally average deposits and repayment capacities throughout nearly all of the south and east of England, but only in three urban areas elsewhere: Trafford (Manchester), Harrogate and York. The key factor is the influence of London. It has long been the world’s main financial centre (although this has come under threat from the impacts of the decision to leave the EU, membership of which allows unfettered access to the world’s largest single market). Its economy and employment prospects benefited hugely from financial deregulation and globalisation. As an economic entity, a ‘global city’, it has been one of the world’s main winners from those processes. Its previous population decline was replaced by vigorous growth, 193

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from both within and beyond UK borders. Wages for many (but by no means all) types of jobs were higher than elsewhere. The ripple effect of London’s boom was widespread, stretching into commuter belts way beyond its boundaries. It has also been a target for property investment as a secure asset, after the crash. However, what has been good for London’s economy has not been good for many of its people. Although long-standing homeowners have watched the value of their ‘asset’ increase at astonishing rates, this is of little use to them unless they wish to leave the city. Newer homeowners who have managed to buy, by hook or by crook, are often from advantaged families who have sufficient assets to provide very substantial deposits for them, since otherwise their salaries would not allow for mortgages sufficient to cover the cost of buying a London home. The so-called BoMaD (Bank of Mum and Dad) was estimated to be the ninth largest lender in the UK in 2017, providing around £6.5 billion for their children to buy.4 By the end of 2018, the influence of parental wealth for buying a home was almost as important as earnings. Such patterns are evidently reinforcing and deepening structural socio-economic inequality.5 The luck of being born into such families was further enhanced throughout much of the second decade of the twenty-first century because state provision of ‘easy’ money to financial sectors to reduce the recessionary impacts of the crash meant that interest rates fell to historical lows. Thus, their monthly payments were more manageable than is usual for those in the early years of a mortgage; they were often paying considerably less for similar accommodation than renters.6 However, when interest rates eventually began to creep up, one estimate in November 2018 suggested that average annual payments for first-time buyers in London could rise by around 50% by 2023 to £19,100.7 People established in PRH and some other types of social housing may manage, although rents are steadily increasing in real terms, as long as the regeneration teams do not evict them. Yet, as the term ‘Generation Rent’ implies, the cohort effect in London is a defining one. The various pressures ‘unsquaring the circle’ gradually dragged more and more of each succeeding annual set of young people who left the parental home in the city or moved into London into increasingly unaffordable private 194

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rental accommodation for the long term. Over the ten years preceding 2017, the proportion of all households buying houses in London fell from 36% to 22%, while those renting privately rose from 19% to 30%. In England over the same period, the proportion of those aged 35–44 who were owner-occupiers fell from 72% to 52%, and the proportion renting privately almost trebled, from 11% to 29%. Younger cohorts are always more likely to rent, for various reasons, but the shifting nature of what faces them in contemporary English housing markets is obvious. For those aged 25–34: in England as a whole 46% were renting privately in 2016–17 compared with only 27% ten years before;8 in south-east England, 64% owned homes in 1997 compared with 32% in 2017, and in London it fell from 47% to 20%.9 Similar trends are clear in the USA: by 2017 the number of households renting was 8.7 million more than in 2006 and the highest recorded since 1965.10 The negative impact on homeownership, and on many assumptions about American lifestyles and the country’s comparative positioning, was indicated by a 2017 report on nine countries by the banking group HSBC. This found that, for the millennial generation (born 1980–97), homeownership was most common in China (70%), followed by Mexico (46%), France (41%), Malaysia (35%), USA (35%), Canada (34%), UK (31%), Australia (28%) and UAE (26%). The report attracted media interest and some surprise that GN countries did not top the list – one headline was ‘The American Dream appears to be more attainable in Mexico and China’.11 A fourth issues is how market forces have allowed rents to rise but deregulation and lack of resources and political will for monitoring ‘decent’ standards and abuses of power have (re)created conditions in which the insecurities and health hazards typical of the rental sector in the past have again become common.12 Rises in evictions13 mean that tenants are frequently too scared to report these. In London, a desperately tragic outcome was a massive fire at a high-rise block, Grenfell Tower, in 2017. Seventy-two people died. The uncontrollable nature of the fire was due to cost-cutting in the choice of cladding added to the tower a few years before. Grenfell was not the first UK high-rise residential tower to suffer such a fire and all 95 blocks owned by councils and housing associations 195

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subsequently tested failed combustibility tests. This was possible due to the general shift towards allowing business more input into regulatory standards and a freer hand in interpreting them. As explained by the investigative journalists of Private Eye, ‘The background to the use of cheap plastic insulation was the changing world of building regulations in the early part of this decade. In what the Department for Communities and Local Government … boasted was a “largely deregulatory” package of changes, energy efficiency was placed at a premium and concerns over fire safety almost entirely ignored.’14 This provided the context whereby ‘organisations responsible for maintaining standards in the building industry have been advising contractors not to take regulations too literally’.15

Policy responses: handouts for the middle classes and attacks on housing subsidies for the poorest Housing affordability is definitely on the political agenda in the GN – it cannot be ignored. However, particularly in the UK and USA, mitigating policies generally focus on helping those in middleincome brackets ‘back’ onto the housing purchase ladder. Policies related to low-income groups are usually still negative, as the excuse of ‘balancing the books’ after the financial crash slashed budgets that helped them attain, or remain in, affordable housing with decent standards. In the UK, the level of housing benefits allowed for individual households has been continuously chipped away by new policies, including caps on income and housing support. The litany of cuts included rent support for households in need in ‘expensive’ residential areas being deliberately made increasingly insufficient, thereby gradually removing them. A ‘bedroom tax’ in PRH reduced benefits for households with ‘spare’ bedrooms. Most types of income support were frozen for four years from 2016, so inflation whittled away their real value. Even worse, housing benefits payable to those in social housing were cut by 1% per year for that period. Long periods of waiting have been made the norm before various types of income and rent support are allowed for new claimants, leading to desperate situations including severe hunger – conditions that had become increasingly unusual, and had been regarded as 196

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unacceptable, under the previous norms of the post-war welfare state. Astonishingly, general income and housing benefit support for children has been limited to two children per family, striking at the very heart of the premises underpinning GN norms about ‘decent’ housing and the prevention of poverty. Housing benefits have also been bundled up with other welfare payments into ‘universal credits’ in ways that can reduce the incomes of the poor.16 When some of these measures were announced in parliament in 2015, the desire to move to a ‘lower welfare’ society was repeatedly stated17 – betraying the ideological driving forces behind the cuts, if that phrase is understood (as intended) as state support for people on low incomes, as well as (unintentionally) the sadly inevitable outcomes in terms of its general meaning of reduced well-being. The British government estimated that it would save £12 billion over the period from 2016 to 2019–20 through welfare cuts such as these. As unelected HAs have increasingly replaced local governments in the delivery of subsidised housing, the UK government mooted plans to force them also to sell to their tenants, thereby further reducing the stock of housing at subsidised rents. To make matters worse, the discounts required were to be funded by forcing councils to make annual payments to central government by selling off their most valuable housing stock – which was bound to be in the very areas where the affordability crisis was at its most acute. The policy was eventually shelved18 but was indicative of the determined nature of the attacks on the policies that had once served to address housing affordability. In any case, since HAs often espouse neoliberal values, they are far from averse to privatisation if the outcomes are highly profitable.19 In 2016, 3,891 HA houses were sold to the private sector, and the rate of such sales has trebled since 2001.20 In the USA, the Trump government proposed cutting $6 billion from federal housing programmes in 2018. Although these measures were not passed by Congress, the 2019 budget proposals were even more extreme, including removing all funds for rehabilitating and modernising the public housing stock. The privatisation of public housing stock is a favoured policy, with 60,000 public rental units becoming privately rented and with residents’ rent payments topped up by government-funded vouchers. The general desire to 197

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attack low-income housing programmes is as evident as in the UK, at the same time as the housing dilemma worsens.21 The American evidence perhaps most clearly illustrates how the housing dilemma does not derive from unemployment but from market-set low wages. By 2018, unemployment there was at almost record lows (3.9% in July). Workers’ purchasing power was the same, however, as in 1978, and ‘in real terms average hourly earnings peaked more than 45 years ago [in 1973]’. This is not an artifice of shifts towards different patterns of work: the real ‘usual weekly earnings’ of ‘employed, full-time wage and salary workers’ in 2018 was also about the same as it was in 1979.22 The outcry about ‘affordable housing’ from the middle classes and those at points on the income distribution scale that had previously almost assured that they could afford very good housing and a good lifestyle – the two categories are not always synonymous – perturbed the UK Conservative government. As in the USA, homeownership is still one of the party’s core political ideologies. Furthermore, these groups include many who are perceived to be natural supporters of conservative governments. In the UK’s 2015 budget speech, the party emphasised that it was ‘building more homes and creating a fairer property market. This is a government that is unwavering in its support for home ownership. That’s why we’re introducing the new Help to Buy ISA [tax free savings].’23 This was one of various schemes to help these groups that emerged once the dangerously loose mortgage lending approaches which caused the financial crash were ended. This meant that lenders again required proof of capacity to pay over the long term, with consideration taken of the possible impact of rises in interest rates.24 Very much higher deposits than had been the norm were also commonly required – for example, 25% instead of the ‘old’ 10% (or much less in the run-up to the crash) of the house price. Yet the massive surge in house prices in some cities since 2008 has ‘priced out’ so many who might once have been able to buy that these new requirements only add further pain to what is essentially already an impossible situation – most people’s incomes simply are not sufficient to command a loan commensurate with buying housing, and those paying rents in such cities might take decades to save the deposit. 198

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Yet wealthier households can and have benefited from such schemes, especially when parents have helped with deposits (which averaged £44,000 for first-time buyers in 2019).25 Government policies have included some houses for purchase at prices somewhat below the market rate. For example, in 2014 the Conservative government introduced a ‘starter’ home programme to provide some new-build houses to first-time buyers aged under 40 at a 20% discount. There were various limitations: in London the maximum ‘real’ price of the house was £450,000, and elsewhere £250,000, and the initial programme covered only up to 40% of 13,000 houses the government was commissioning. As is almost invariably the case with such schemes, the discount was far too small to make a difference to people on the lower deciles of the income distribution, particularly in London and the southeast of England. It was a boon only to those whose position on the affordability curve was near the cost of a market-rate house. For the majority in the housing dilemma it was meaningless: a £450,000 house was equivalent to 17 times the average salary. ‘Starter’ homes were unaffordable for people on low incomes in 98% of the country, and even for those on middle incomes in 58% of the country.26 To buy such houses, households needed to earn at least £77,000 in London and £58,000 elsewhere.27 Policies that ignore the reality of most people’s incomes can make little difference, evidently. They can help the building industry, however, which is a powerful lobby. The fact that the programme was for new houses only was indicative of the industry’s power. Nonetheless, no starter houses had been completed by the end of 2019.28 Another element of the Help to Buy scheme provided a mortgage guarantee for the lender and included existing housing valued at up to £600,000. Although this meant upfront deposit requirements could be reduced to 5%, the borrower had to pay the full costs of the mortgage loan. The Home Builders Federation claimed that these help-to-buy policies had been highly successful, stating that, ‘[d]espite claims from critics, the scheme is helping those it was set out to’, as, in 2017, ‘the median household income for those using the scheme was £49,000’.29 Yet this was higher than the average income of £43,261 for those in the fourth quintile of the UK’s income distribution in 2016 199

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Average per household (£ per year)

(see Figure 8.1), so those helped would mainly have been in the country’s highest income brackets. This may have been the intention of the scheme in reality, although it was certainly not publicised as such. The lobbying group PricedOut is scathing about the helpto-buy schemes: according to its index, since their inception around an extra quarter of a million taxpayers had joined the numbers who were renting and could not afford to buy by 2018.30 Another view is that the scheme is ‘a crowd-pleaser, that has helped to buy yachts for housebuilders’.31 Gestures such as the help-to-buy policies described above show that, in the UK, as elsewhere in the world, there is a strong political interest in diverting analysis and policy away from the true implications of affordability in the housing arena. Explaining what housing would cost were prices reduced to what is truly affordable for, say, the bottom half or bottom quarter of the income distribution would shine too bright a light on the intractable truth that it is income that is the problem. As a result there is often political manoeuvring over the meaning of the term ‘affordability’. In 2016, the British prime 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Bottom

2nd

3rd

4th

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Households by income quintile Original income

Gross income

Disposable income

Figure 8.1  Income distribution by quintile in the UK in 2016 Source: Data from ONS dataset: ‘Effects of taxes and benefits on household income, year ending 2016’.

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minister, David Cameron, having said that affordable housing only meant ‘a house that someone can afford to buy or afford to rent’, continued: ‘Sometimes I think we get too hung up on these definitions.’ This ridiculous statement would mean that even houses bought by multi-millionaires were affordable simply because they had been bought. It is not surprising, though, that he tried to dodge further specifics as governments may be held to definitions if they pass them into legislation. By 2016, in UK policy terminology, ‘affordable’ housing had come to be understood as being priced at 80% of local market prices or rents – which is way beyond the means of many in much of the south-east of the country. It also bears no relation to the generally accepted idea that affordable housing must relate to incomes. The real policy relevant to affordable housing when Cameron spoke was that investment in public housing had just been halved.32

Squaring the circle by squeezing the space The new levels of housing costs in the major cities of the GN are a crisis leading to desperate measures. Outcomes and strategies have emerged which have often meant the spread and reassertion of types of accommodation below established ‘decent’ standards even where such issues had seemed to be ‘history’ (at least when compared with the GS). In other words, the gap between the urban housing norms of the GN and the GS is narrowing. The Member of Parliament for Tottenham in London, David Lammy, said in 2018: ‘Damp bedrooms, faulty heating systems, electrical faults, broken plumbing, unsanitary toilets, and rat-infested kitchens are depressingly familiar in our swollen private rental sector … We are living in a new Rachmanite era of squalid housing on steroids.’33 Another example of the desperation is that some tenants, unable to pay market rents, have been pressured into arrangements involving transactional sex with their landlords.34 One way of ‘solving’ the dilemma is simply to live in less housing – squeezing the space available to each person. Yet this is why the word ‘slum’ is so often coupled with ‘overcrowded’ – it is not only 201

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the poor quality of housing that can create real slum conditions but the danger to physical and mental health if there is a lack of space, light and air. Infectious diseases are easily spread and vermin can become ubiquitous. Societies may have different norms, but it is common for there to be a preference for the sexes to sleep in different spaces once puberty is reached. These factors are built into ‘decent’ housing standards in the UK, as discussed in Chapter 3 – space requirements are the key reason why families are so ‘expensive’ to house in the GN. These requirements have always been under pressure and were not always met, but the current housing climate means that all actors involved in urban housing are pushed or enticed into providing or buying types of accommodation that are spatially inadequate. Those faced with the housing dilemma and unable to get access to PRH may downsize, moving into housing without enough bedrooms or simply without enough room, because ‘proper’ housing would leave them short of food, clothes, and various other necessary expenditures, including, crucially, travel-to-work costs. As Feargus O’Sullivan of CityLab puts it, ‘high costs end up jamming more people into smaller homes’.35 According to Kate Webb, head of policy at Shelter, ‘particularly in London, it is now no longer shocking to speak to families who are living in a single room in a shared house. They are not homeless and have not been placed there by the council. But it is all they have been able to afford on a limited income.’36 Local authorities, under intense budget pressures and with dwindling rental stock, face longer and longer waiting lists of people needing PRH if they are to have decent housing and struggle to rehouse households whose space needs have increased, leaving families in below-standard housing. Further pressures are created by rising numbers of evictees from private rentals as rents increase beyond their means. Such evictions are intensified by cuts in housing support arrangements.37 In the UK, thousands of households rendered ‘homeless’ through evictions or other situations are theoretically entitled by statute to be rehoused by the state but the system is crumbling. It is common now for homeless families to spend time in dangerously inadequate ‘bed-and-breakfast’ accommodation, essentially housed in one small ‘bedroom’. Some are even being 202

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moved into shipping containers.38 The average length of time spent in this sort of inadequate accommodation is increasing. As will be seen, this is now being combined in the UK with geographical shifts that are a type of ‘forced migration’. Single people are sometimes even resorting to ‘“hot bedding” – sharing beds with flatmates and synching sleep around work shifts to pay the rent’.39 In cities where the housing dilemma is ‘booming’, the final set of actors involved in ‘squeezing the space’ are those in the private sector who choose to increase their profits by packing more people into rental units. One three-bedroom house in the London borough of Newham illegally housed 26 people from three or four different families in 2015, and a local housing official said that ‘it was not unusual to find 20 people in a three-bedroom home’.40 Another strategy is selling ‘apartments’ invented by dividing up existing units or simply by relabelling and refitting spaces such as garages or storage spaces.41 These often break the space standards set for ‘decent’ housing, as well as various other rules about safety, but local authorities are under too much pressure to monitor these reliably, even where they are so inclined, and in any case they have more limited powers against the private sector than they do for public housing. Another ‘solution’ that has become more common particularly in London is the construction of freestanding rental units in gardens and other similar spaces, usually breaking all local planning rules as well as ‘decent’ standards.42 Local authorities may try to have these removed, if they discover them. Another emerging ‘solution’ in the UK is for people to live permanently in caravans or motorhomes – where the caravan is ‘static’. This is rarely legal as there is a range of regulations, including liability for local taxes, that prevents permanent residence in ‘mobile’ homes. So-called ‘holiday parks’, which often have large numbers of static caravans, have to close for a period each year, for example. Nonetheless, as housing affordability issues increase, gaps between the ‘rules’ and practice can expand. In 2016, a survey found 12,000 housing benefit claims were being paid for households in caravan and mobile home parks. Castle Point Borough Council, about 20 kilometres east of the M25, London’s ‘ring’ motorway, had the highest incidence and argued that there was little choice as central 203

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government changes to housing benefits meant they did not cover local market-based rents. As a representative of the homelessness charity Crisis said, ‘millions of pounds of benefits [were] being spent on keeping people in completely substandard living conditions’.43 There are similar types of housing arrangements across Europe. Regulations differ about the permanence of residence and precise types of residential units allowed, and there is much variation in such sites between use essentially as a home for people of working age and their families due to affordability issues, as retirement homes chosen because they are affordable and perhaps in attractive ‘rural’ or coastal locales, and as ‘real’ short-term holiday homes, making it difficult to generalise. In the USA, where 6% of all households, comprising 18 million people, were living in 8.43 million trailers, or ‘manufactured’ housing, in 2013,44 this ‘solution’ is more common than in Europe. In 19 of the 51 American states, these housing types made up 10% or more of housing units in 2004,45 with the highest rates at the last census in 2011 in South Carolina, New Mexico, West Virginia, Mississippi and Alabama. By 2015, the largest numbers of new ‘manufactured houses’ were being built in Texas, Louisiana and Florida.46 There is nonetheless an uneasiness about trailers that do not conform sufficiently in construction, permanence, image or tenure to the ‘American Dream’ about family housing. Some may own the ‘structure’ they live in but the ‘plot’ beneath is rented in trailer parks, so the tenure is unconventional. There are many opposing vested interests, as neatly encapsulated in a 1961 report on mobile homes prepared for the American Society of Planning Officials: It is about as popular with conventional home builders as was the automobile with buggy manufacturers. The realtor seldom gets a cut of mobile home deals. On a lot in a conventional residential neighborhood, the mobile home still creates alarm, shock and lowered property values … Local tax officials are faced with a licensed vehicle which is usually an owner-occupied permanent home on a lot (usually rented) from which it may move … The building official has several problems … Should housing codes designed without consideration of the mobile home be applied. 204

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In zoning, what should he do when the definition of singlefamily residence obviously fits the mobile home, but the mobile home equally obviously may create a riot if permitted like any other house in conventional single-family districts?47

Their expansion has thus been controlled by a web of varying state regulations, particularly zoning laws48 – ‘[l]ocal authorities are very reluctant to grant permission for new parks’.49 Yet trailers and trailer parks are big business – they are highly profitable. The ‘Sage of Omaha’, Warren Buffet, regarded as one of the USA’s most canny investors, owns both the largest manufacturer of trailer ‘homes’ and the two largest lenders for such housing.50 They ‘earn the rare distinction of being among the only forms of new housing provided by the market for mostly low-income households’.51 How can this be if, as per the precepts of the housing dilemma in the GN, the poorest cannot pay enough for ‘decent’ housing to make investment in this end of the market profitable? Much is due to their being unconventional in terms of tenure and housing type – and, of course, they are small. The average USA trailer park ‘lot’ (mobile home plus surrounding plot) covers between 960 and 3,600 square feet, compared with an average of 8,000 square feet for permanent homes. As with some cheap fixed-rental units, profits may rely on state housing subsidies for the poorest. Thus, they are not ‘affordable’ for them. Yet average rents in trailer parks are low by US standards: around half the average for fixed housing.52 In part this is due to geography – they are where land is (relatively) cheap. Nearly half (49%) are outside a metropolitan area.53 Were there a serious demand for land for permanent housing or other uses at their sites because of proximity to big-city economic opportunities, land use would change due to general market forces and pressures to rezone the sites to provide higher returns for local governments. When this happens, everyone is evicted, just as with renters in fixed housing affected by ‘regeneration’. Their great attraction for landowners is often that the rents obtained for relatively little investment far exceed income from realistic alternative site uses, which may be ‘rural’ in nature. In the absence of regulations being enforced, no doubt trailers would become much more common in the USA. Some would 205

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welcome this, feeling that it would make life easier for poorer groups and make serious inroads into the housing crisis. It probably would, although care would be needed to enforce basic space and sanitation standards to prevent the emergence of slum conditions. The urban research group CityLab supports the expansion of such housing, arguing that the USA ‘housing crisis isn’t a technological problem – it’s a legal problem’. It notes that some city leaders ‘have started to warm up to the idea that tiny pre-fab structures can serve as affordable housing in an urban setting’.54 Nonetheless, most remain adamantly opposed.55 Also, although the views of lobbyists such as CityLab may be understandable, they are mistaken about the causes of the crisis. These are neither technological nor legal but economic: low incomes, as the history of urban low-income housing worldwide demonstrates. The crisis exists even where regulations are virtually non-existent or, more usually, simply never applied. The point being missed is that decent housing only became possible for low-income groups in the GN because of past political ‘moments’ when there was sufficient willingness to legislate for certain standards and provide meaningful subsidies in societies that could easily afford these measures. So, while it is true that legislation and regulations increase housing costs, there is a great danger in ahistorical attacks on these measures. They too easily fail to make distinctions between policies that protect the poor in the long term and those which serve mainly to protect the vested interests and prejudices of wealthier groups. Sliding further down the city housing space spectrum are those who live in cars, a ‘solution’ that breaks all the rules of housing ‘decency’. In the USA, this too has been on the increase. It is often illegal and ‘residents’ parking on city streets must keep moving their cars to avoid arrest,56 so there are few hard statistics and some overlap with data on people living in RVs (large ‘recreation vehicles’ designed for sleeping in). In the West Coast states there has been ‘an explosion in many major cities – from Los Angeles to Portland, Ore., to San Francisco – of “vehicular homelessness”’ in part due to house price rises driven by ‘tech’ gentrification. Sara Rankin, from Seattle University School of Law, who specialises in homeless rights advocacy, calls it ‘the new form of affordable housing’.57 There are also 206

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‘the Okies of the Great Recession’: nomads in RVs driving around the USA, working in temporary jobs, many of whom are over 60 and have had to sell their houses or found their rent in fixed housing unaffordable. Their plight is described in Jessica Bruder’s 2018 book Nomadland: Surviving America in the Twenty-first Century.58 Living in camper vans parked on city streets is also on the increase in UK, with a particularly significant incidence in the city of Bristol, mainly because those involved ‘simply cannot afford to rent or buy in Bristol in the current climate’.59 The ultimate housing space ‘fix’ is to have none at all: homelessness. The US Department of Housing and Urban Development reported in December 2017 that there were 554,000 homeless in the USA, of whom 193,000 had no access even to stopgaps such as emergency shelters. The numbers of ‘unsheltered’ homeless had risen 9% since 2016, and, not surprisingly, the problems were most acute in states where housing was most costly.60 In 2016, in Los Angeles County, where ‘[a]verage rents … have increased by 32% since 2000 while average household incomes for people renting have fallen by 3% when adjusted for inflation’, homeless numbers rose by 23%.61 In 2017, a Parliamentary Select Committee in the UK reported that in England the number of unsheltered ‘rough sleepers’ had increased by 134% since 2011 to around 91,000, and those in temporary accommodation by 60% since 2010 to about 78,000 households. The report concluded that this situation could only be improved by a ‘focus across government on tackling the twin issues of both the supply and affordability of decent housing’.62 These official data from the UK and USA show the trends but only capture those ‘on the record’; the real scale of the problem is definitely worse. For example, there are many people who shift around, ‘sofa-surfing’ between friends and relatives, unable to afford a permanent ‘home’. Since definitions of homelessness vary and many countries do not collect reliable data, comparative analysis is not easy. In Planet of Slums in 2006, Mike Davis estimated that Los Angeles alone had 100,000 homeless, calling it ‘the First World capital of homelessness’.63 In Greece, census data indicated a 25% increase in homelessness in the two years after the financial crash, although the methodology involved has been questioned.64 In Athens, in 2016, 207

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the City of Athens Homeless Shelter estimated that there were about 9,000 homeless and the problem was worsening, with most of those affected being ‘victims of the economic crisis’.65 Greece shares the dubious distinction with Spain of having the lowest rates of publicly subsidised housing in Europe, around 1% of housing stock. In Spain, homelessness was also driven up by the impacts of the financial crash and its own subprime mortgage lending, with 400,000 to 600,000 home repossessions ordered in the nine years to 2017.66 There are over 1.5 million homes for sale as a result, but the crisis of housing affordability is worse than ever as average real incomes fell 13% from 2008 to 2017 – a painful demonstration of the fallacy of assuming that the housing dilemma can be solved by supply of market-priced housing. The resulting empty housing stock, however, has created a further solution for the homeless: squatting. This is tied up with social activism to help the homeless find suitable squattable properties, especially those now owned by banks, which are seen as ‘fair game’ given their role in the crash. Entire apartment buildings can be taken over: 45,000 are estimated to have been squatted in the five years to 2017. Squatters have rights if undetected for 48 hours, and it can take years to repossess the previously empty properties, so the system provides a crucial reprieve for the otherwise homeless or desperately overcrowded.67 Squatting movements can be tied into philosophies of political and social activism that deliberately seek to challenge not only the economic but also the social and cultural constraints imposed by the norms of capitalist cities and property rights. Perhaps the best known examples come from Berlin; these have been eloquently described by Alex Vasudevan of the Geography Department of the University of Oxford.68 Squatters’ rights can help those trapped in the housing dilemma but are under pressure from neoliberal values: in the UK, for example, where they had existed for centuries and were much used by the poor in big cities, they were abolished in 2012. The discussion above has focused on examples from the GN of ‘squeezing the space’ to counterbalance the more usual tendency to use examples of such housing conditions from poorer countries and to demonstrate how poverty drives recourse to problematic housing ‘solutions’ in any part of the world. In most GS cities, such 208

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strategies are commonplace. Having no choice but to live on the streets is far more likely. Living one family to a rented room is unremarkable in many residential areas in Asia or Africa. Having 20 or 30 people living in various buildings and outhouses on a housing plot originally ‘designed’ for one family may also be common in parts of some cities, as illustrated in Chapter 7 for Lilongwe in Malawi. In 2014, when half the households living in inner-city Johannesburg earned under 3,200 rand, an income of 5,700 rand was needed to afford the cheapest private-sector rented room. As a result, ‘many people live informally in dilapidated high-rise buildings, flats, houses, rooms, parts of rooms, balconies and in bed-sharing arrangements’.69 Overcrowded rented row housing (single-room lanes) is a common housing type in urban India; some of these forms of housing have similar histories to the urban villages of China, having been built by farmers whose land has been swallowed up by urban development.70 The remarkable issue is the (re-)emergence of these phenomena in certain GN cities and the analytical parallels between both their causes and their effects in the urban GS. Trailer and caravan parks can, for example, be usefully compared with ‘shack farming’ on commercial farmland around Johannesburg, or the emergence of rows of rental units on land with indigenous tenure on the fringes of many sub-Saharan African cities. Distance and ‘unconventional’ tenure shape these ‘free-market’ outcomes. Their unusual tenure does ‘protect’ the poor by keeping prices down, but across the world rezoning, regeneration or ‘regularisation’, which shifts the neighbourhood upmarket, can then squeeze them out. ‘Sheds in gardens’ in London are the same ‘solution’ as backyard shacks found across the legal, formal old townships of the former white settler states of southern Africa. The pressures to downsize to less adequate accommodation when global forces savage incomes are ubiquitous: Structural Adjustment Programmes across Africa in the early stages of neoliberalism saw millions in the middle classes priced out of formal housing and forced into smaller homes or informal settlements – moving house is always the first strategy to cope with severe income shocks. Although it is believed that these converging trends are significant phenomena, at the same time it is important not to overstate 209

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the comparisons. This would be disrespectful to the millions in GS cities whose housing conditions remain far worse than anything so far re-achieved by trends in the GN. True slums on the scale that used to be common enough in GN cities have not re-emerged: there is nothing like Kibera in Nairobi or Dharavi in Mumbai, or a host of other grossly overcrowded neighbourhoods in which many (but not most) still live in GS cities. Yet, it is worth noting that in Hong Kong, which is no longer reasonable to define as ‘GS’, and which is generally agreed to be the world’s most expensive city for housing, ‘squeezing the space’ includes, for tens of thousands, the legal but almost inconceivable housing solution of living in so-called ‘cages’ or ‘coffins’:71 ‘accommodation that is only large enough for one bunk bed surrounded by wire mesh like a cage’.72 Cages are the tiniest subcategory of Hong Kong’s SDUs (subdivided units), in which around 200,000 residents have an average 5.8 square metres per person.73 In Taiwan, where incomes and social development indices are commensurate with GN status, although it is more generally still classified as an ‘emerging economy’, there is also an urban housing crisis. In the capital, Taipei, it is said that ‘housing is so expensive that the average household would have to “neither eat nor drink” for over fifteen years in order to own a place’.74 Here, there are 98,000 illegal housing structures, with a further 192,000 in New Taipei City. Many are ‘illegal rooftop additions jerry-rigged from scrap materials placed precariously on top of a four story building to make a flimsy “fifth floor” … [I]n some cases … multiple illegal floors [are] pancaked one on top of another like a giant jenga tower.’75 As in Hong Kong, the subdivided spaces provided are often tiny: in one building where four floors had been added, these were ‘carved into a honeycomb of 158 tiny rental suites’.76 Extremely small apartments are also a feature in Tokyo, including some so small that they, too, are labelled as ‘coffin apartments’.77 The city also has many microapartments. One famous experimental block, the Nakagin Capsule Tower, with 140 ‘capsules’ measuring only 100 feet square, dates back to 1972 – although many units are used now as offices.78 For most of Tokyo’s residents (70%), the space available at home is below the government’s official minimum recommendation of 25 square

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metres for a single person – this is reduced to 15 square metres each for a couple, but 38% do not even have that much space.79 The conditions within many SDUs of various sorts in East Asian cities means that they should be classed as slums. There is usually some sort of shared access to piped water, sanitation and electricity, which helps prevent the health outcomes of nineteenth- and early twentieth-century slums in, say, the cities of the GN, but the partitioning of existing buildings and extreme overcrowding are very similar. Evidently the housing is not ‘decent’. Although lessors may legally own the land and buildings – as they did in London or Paris – a host of contemporary local building and safety regulations, let alone space requirements, are always being flagrantly broken. Fire and ventilation hazards are extreme and lead to many deaths. In 2017, for instance, 19 garment workers died in a fire in SDUs in Xinjiang Village in Beijing: the second floor of the ill-named Gathering Good Fortune Apartments had over 100 ten-square-metre rooms and only two staircases.80 Housing of this type should be deemed as informal in the same way as many settlements with legal tenure but noncompliant housing standards around the edges of cities across the GS. They are increasingly common in Chinese cities as migrant workplace dormitory accommodation dwindles – nearly two-thirds of all urban migrant workers now rent privately. Research in 2017–18 in Shenzhen, Guangzhou, Shanghai, Wuhan and Suzhou found (as is so often the case worldwide) that ‘[m]igrant workers are unable to support the cost of formal market-priced housing’. The ‘group rental’ arrangements (SDUs) into which they were forced were classified by the researchers as informal housing. Their prevalence as an affordable option for low-income migrants was increasing as regeneration removed many of the best-located old, affordable, urban villages. The demand is high, so ‘landlords and private intermediaries see opportunities to partition individual rental spaces into smaller rented rooms, or to install bunk beds and rent out individual bed spaces, increasing profits as a result’. Such housing is rented directly or by employers, who then ‘arrange beds and shared housing for their employees’. The researchers suggest various policy measures to mitigate these dangerous and inadequate housing conditions but

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conclude that the real solution is to end the hukou system that registers most migrants with their place of origin, thus preventing their rights to many types of public services in the cities where they work (see Chapter 9), and allow migrants ‘to apply for public rental housing’.81 Constructing units ‘cheaply inside [formal] housing structures that were not originally designed to serve such a dense population’82 may make for a less visible sort of informality than large, sprawling, low-rise informal settlements, but this can just as easily (or more easily) create slum-like conditions. Also, being inherently ‘indecent’, as overcrowding is their raison d’être, they have limited if any potential for upgrading and regularisation. Again, there are parallels arising in wealthier cities. In the UK in 2013, central government made it legal to turn commercial buildings into residential premises without planning permission (permitted development rights). Ostensibly this was to ease the housing crisis, but unfortunately local authorities were not allowed to exercise controls to ensure decent standards; inevitably, developers, as in China, have seized the opportunity to create tiny rental units. Essentially the conditions are slum-like (see Box 8.1).

Box 8.1 The conversion of offices to slums in the UK By 2019, 42,000 dwelling units had been created within previously non-residential premises, usually offices, in the UK. These are exempt from space standards and the results have been disastrous. The legal space for a one-person onebedroom unit is 37 square metres. In one office block in Ilford, East London, 60 units have been constructed with as little as 13 square metres each. In Harlow, ten miles north of London’s ring road, the town’s tallest building, Terminus House, has also been converted. Conditions are grim. One mother living with two children, for example, was removed from London and housed in the erstwhile office block in one room. The sofa doubling as her bed was situated ‘a few feet from the oven

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and sink’ and ‘[p]ressed close to … one of the two beds that fill the rest of her flat and upon which her two sons eat, play and sleep’. Down the corridor from her another single mother with a small child was also living in one room, having been relocated there by Epping Council. In January 2019, there were over 1,000 similar units in office blocks in Harlow, comprising half of all new dwelling units there. These sorts of conditions were described by the opposition Labour Party as ‘slum housing and rabbit hutch flats’. There are many reports of such units without proper ventilation, unopenable (or even no) windows, unsafe electrics and inadequate fire safety arrangements. The interim chief executive of the Town and Country Planning Association deemed the regulatory changes as ‘probably the worst housing policy mistake in the post-war era’. A council member in Croydon, south London, has stated that ‘we are building the slums of the future’. Astonishingly, in London, of about 16,000 dwellings built under ‘permitted rights’ in the six years to 2019, only 0.4% were defined as affordable and 59% provided less than the minimum space standards. The rapid emergence of such units when regulations were relaxed demonstrates how crucial decent housing standards and properly resourced housing benefits had been in preventing unsafe housing in the UK, the inherent trend back towards slum housing for the poor in their absence, and the knife edge on which urban housing outcomes teeter in even the wealthiest societies. Sources: BBC News. 2019. Labour pledges to end slum ‘office’ housing. BBC News, 24 April; Sturdy, J. & M. Precey. 2019. Inside Harlow’s office block ‘human warehouse’ housing. BBC News, 3 April; Evans, J. 2018. ‘Slums of the future’? UK office-to-homes policy sparks fears. Financial Times, 26 December; Copley, T. 2019. Slums of the Future: Permitted Development Conversions in London. London: London Assembly Labour.

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As the evidence of this chapter demonstrates, the various strategies for affording housing in big cities by limiting the space purchased very quickly lead to situations where the housing is not ‘decent’. According to the arguments in this book, this means that it might be regarded as informal no matter in which city it is found. Living in such circumstances is unhealthy, undignified and stressful. As space dwindles there also comes a point at which only single people, and not households, can be accommodated. Put another way, the crisis of housing unaffordability can cause unbearable stresses which are then reflected in city demography: the role and fate of migrants, the nature and timing of family formation, and fertility outcomes. These issues are the subject of Chapter 9.

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Broken cities, broken households: the demographic impacts of unaffordable housing Introduction There are crucial links between the issue of decent and affordable homes and the nature and size of the households who live in them. This is where some of the sharpest tensions between analyses of housing in terms of (monetary) demand as opposed to social need are manifest. As housing becomes increasingly unaffordable, the nature of the city’s demography shifts: households dwindle in size, divide or join together; decisions about family formation and family size shift; and the characteristics of the urban workforce adapt to the inexorable constraints of housing markets and incomes. The needs of different types of households may be covered by housing standards legislation, as discussed for the example of the UK in Chapter 3. The presumption that each member of a household needs to be considered when setting space and bedroom standards (in the same way that they each need food when setting nutritional standards) has large and necessary cost implications. In particular, it has implications for families with children. Where relevant legislation does not exist or is not enforced, poor households are often pushed to address unaffordable housing costs by squeezing their housing space, as discussed in Chapter 8. Towards the end of the housing space-andcost spectrum there is no room for families and eventually there is 215

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no room for a two-person cohabiting household – in other words, the urban ‘household’ can consist of only one person. If even that cannot be afforded, either that person become homeless but remains in the city or they leave. These housing pressures have profound implications for the current and future demography of the world’s largest cities. This includes factors such as fertility rates, age of childbearing, the timing and rate of new household formation, and the nature of migration and characteristics of migrants to and from the city. This chapter starts by considering the complex links between housing affordability and migration patterns.

Squaring the circle by squeezing the right to family life Institutionalised migration controls and housing

Analyses of cities and migration tend to be fascinated by in-migration: what sort of people move to the city, how many and from where. Yet just as important are the explanations about who and how many do not or cannot move to the city and why. There are very many social, economic and political factors that contribute to both. Housing affordability can be an important influence. One way of ‘adapting’ to housing unaffordability in major cities involves various types of migration. Neoclassical migration theory draws distinctions between voluntary and forced migration. Forced migration is understood mainly to be driven by events such as war, political persecution, evictions or natural catastrophes. Thus households or individuals who move because they cannot afford urban housing would be categorised as ‘voluntary’ migrants. Nonetheless, within so-called voluntary migration many theorists accept that most decisions are rarely truly voluntary, since they are shaped by structural conditions faced by migrants, both collectively and individually, which are beyond their control. For international migrants, evidently visa and border controls are critical. Within countries, the distribution of employment and income opportunities are structural factors that influence decisions to move, for example, and housing affordability can be considered in this way as well. 216

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Migration can ‘address’ the housing dilemma by the practice of dividing families so that only those working in the city live there while the others are housed more cheaply elsewhere. This can involve workers moving in from elsewhere ‘alone’ or the others, if already resident in the city, moving out. Households are usually regarded as doing this ‘voluntarily’ even if their stated preferences would be to reside together. But beyond this, many governments have influenced who can be ‘housed’ in the city through laws that explicitly control which members of a household have a right to be in the city or whether any of them can live there. The determinants of such extreme policies are always complex. There are variations in the balance between economic considerations relating, for example, to efforts to keep direct and indirect (low- and semi-skilled) labour costs low and political efforts to reduce the growth rate of elements in the urban population who will demand democratic rights ‘within the city’ but who are deemed by the state to be dangerous to its vested interests. Aspects of the apartheid policies of the former white settler states of southern Africa, discussed in Chapter 5, illustrated these sorts of complexities. During the colonial era, various restrictions were also in place throughout much of sub-Saharan Africa that influenced the extent to which the ‘colonised’ had ‘rights to the city’. Controls on access to legal, formal, affordable housing were among the array of measures used alongside various types of internal ‘passports’ for workers.1 However, in contrast to white settler states, the rigour with which these were enforced was very variable. As land under indigenous tenure usually surrounded ‘colonial’ cities or those parts of precolonial cities annexed by the colonial state, the availability of affordable, unplanned housing limited the state’s capacity for control via housing per se. Since such housing kept costs down both for the state and for employers, and since neither had much, if any, interest in the material welfare of the indigenous population, it was often largely ignored. Of course, by definition, colonialism meant that political rights were denied to urban and rural dwellers alike, and broader ‘rights to the city’ in the sense proposed by Lefebvre as a ‘demand … [for] a transformed and renewed access to urban life’2 in general, which could include access to decent amenities, 217

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reasonable livelihoods, freedom of association and access to public spaces within cities, were also restricted. The legacy of colonial controls on labour and urban processes may influence housing and household composition in former colonies elsewhere, but that legacy is stronger in sub-Saharan Africa. In more recent times, the two societies with the most rigorous and ‘effective’ laws controlling the rights to the city of their own citizens have been China and, in the past, the USSR. As in the old white settler states in sub-Saharan Africa, a mix of political and economic motives were involved and the systems could only be imposed because of the lack of democracy. In the USSR, registration systems, with roots in feudal migration restrictions, controlled permanent residence in the largest cities. As with apartheid pass laws, employers were not meant to give jobs to those without a propiska (local registration). Since the end of communism, elements of registration systems remain but their implementation is much rarer.3 By far the largest number of families now affected by institutionalised restrictions that are reflected in urban housing conditions can be found in China. The communist government imposed serious restrictions on all rural–urban migration until 1984. Since the economy opened up, controls were implemented via the hukou system, with citizens registered to particular places and also, until reforms in 2014, as ‘non-agricultural’ or ‘agricultural’ workers. However, once demands for labour for private enterprises in large cities exploded in the 1990s, the state’s influence over jobs, and thus population distribution, declined and mass migration into cities began. This shifted the sharp edge of controls to the ‘rights to the city’ embedded in hukou status. People are ‘free’ to move anywhere but only those with a local urban hukou can claim various types of welfare within the city in which they reside. This includes affordable housing for urban workers and their families who cannot otherwise house themselves. Other benefits include access to the urban social welfare system (e.g. unemployment insurance, pensions, subsistence allowances) and superior state-provided infrastructure for education and health compared with smaller towns and rural areas.4 However, in-migrants with non-local hukou status have no such rights. Many of the outcomes in China were deliberate: the creation of millions of ‘single’ workers, often young and unmarried but not 218

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necessarily so, who ‘can’ and sometimes must live in workplace dormitory-type residences. This type of housing constrains the formation of relationships and the establishment of new households and family life, which in turn reduces wages. As a report on rural– urban migrants’ housing conditions in China in 2017–18 argues, ‘dormitories can be seen as a hidden means of expropriation of the possibility of social and family life for migrant workers’.5 The alternatives are often the tiny rented SDUs discussed in Chapter 8, which are equally inappropriate for families. In 2014 it was estimated that there were about 170 million rural–urban migrants and 70–80 million urban–urban migrants. The majority are ‘floating’: not registered in the cities where they work and ‘presumed’ to be there temporarily, even if they have lived there for decades. That system allows the costs of reproducing labour and sustaining nonworkers to be displaced to families and governments in rural areas and smaller towns. This helped China establish its phenomenal hold on globalised industrial job creation at the end of the twentieth and into the early twenty-first century – it was part of its ‘comparative advantage’ in the global trading system. The system also exerted other ‘advantages’ for private and ‘state’ capitalist enterprises: exceptional control and surveillance of the labour force, who are on-site even when not working, and, concomitantly, discouragement of organisation to improve worker conditions. Similar factors had played their part in white settler states in southern Africa, although there rural families bore the entire brunt of labour reproduction and, unless they too were registered, family members were not allowed to join ‘temporary’ migrants in the cities, even if they could afford to house and sustain them. Many internal migrants to China’s cities find work in enterprises without institutionalised ‘singles’ housing, but those in low-paid jobs are then faced with the housing dilemma: not entitled to subsidised, legal housing, with incomes too low to ‘buy’ adequate housing on the free market. This in turn means that many ‘squeeze the space’ they buy, leaving those with spouses or children unable to house and live with their immediate families in town, like their counterparts in workplace dormitories. Those who do bring family members or have children in the city struggle with the many costs involved, 219

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including private education. As one report on Beijing’s migrants noted in 2017: ‘In Chinese cities, migrants’ work is welcome. Their children are not.’6 Thus, millions of migrant workers live, alone, in overcrowded rented rooms, often in so-called ‘urban villages’. These may be areas previously designated as agricultural land and villages that have been incorporated into the city fabric. Such land was nationalised under communism, and then handed to communal villages when agriculture was uncollectivised. The capacity of urban governments in China to capture the huge increases in land value generated by urban expansion and rezoning, in ways not available to conventional capitalist states as it involves mass expropriation of peripheral land, has been another driver of its rapid urbanisation and economic growth.7 In some urban neighbourhoods, erstwhile villagers, now re-registered with urban hukou, own high-rise hostels which they were allowed to construct as part of the compensation for the rest of their land being taken for urban development.8 These can then be rented out, often to migrant workers. Reforms of the hukou system have been occurring, and the way it is implemented varies between cities. In general, the trend is to make it easier for higher-skilled migrants, especially graduates, to shift their hukou to a city. Cindy Fan, a geographer at UCLA, calls these ‘state-sponsored “permanent migrants”’.9 There is a strong element of social and economic engineering involved. Local governments in second- and third-tier cities like to entice graduates by granting a local hukou ‘in an attempt to push their economies towards higher-end manufacturing and services’.10 There is very strong competition between Chinese cities for enterprises that will increase rates of local economic growth and officials are rewarded if this is achieved. One result in lower-tier cities has been ‘frenzied investment in property … over the past decade’, outstripping local monetary demand for the housing types involved, leaving ‘many unoccupied apartment blocks’. This created an additional reason to attract well-paid graduates who may then generate the required demand, preventing these investments from becoming a serious drag on the city economy. In some cities it seems to be working: Xi’an, in central China, which ‘granted permanent residency to college graduates from anywhere in China’, increased its population 220

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by 500,000 in the first half of 2018, ‘reduced its inventory of unsold housing by 2m square metres’, and house prices ‘surged nearly 50% year-on-year’.11 The same strategy has seen similar housing price increases in other cities. Wuhan, Chengdu and Tianjin, for example, have all attracted hundreds of thousands of new residents; in Tianjin ‘applicants slept outside police stations and officials fielded 300,000 applications in 24 hours’ when their graduate hukou system began in 2018.12 Yet none of this helps less well-educated and low-paid Chinese workers caught in the housing dilemma – and especially not those who remain ‘floating’ migrants. Indeed, their lives are becoming more difficult in the largest cities, such as Beijing. Requirements for applications for a local hukou have been tightened so much over the past ten years or so that most are ineligible. In 2015, only 5,000 migrants obtained a local hukou in Guangzhou, for example. More explicitly, many are being driven out of the city by housing policies as the affordable neighbourhoods where they were housed are deliberately demolished. Having decided that their populations have grown too large, China’s global cities are thus reducing their numbers by removing affordable housing. Conveniently for the city’s administration and property developers, where these neighbourhoods were reasonably centrally located, this also frees up land for revenue-generating regeneration schemes. The number of migrants living in Shanghai started decreasing in 2015, by 150,000,13 and since urban fertility is extremely low the populations of both Beijing and Shanghai have experienced reductions in recent years.14 Even in Xi’an, where the in-migration of Chinese citizens who can afford market-rate, new-build apartments is being encouraged, poorer lower-skilled migrants ‘complain that demolition of cheap housing is driving them further from the city centre’ and that it is ‘getting harder to obtain a hukou’.15 The focus on China in the discussion so far about squeezing the right to family life in cities is because it has been the dominant actor in global urbanisation over the past 40 years. Thus, its experience is always a crucial feature in urban housing discourses, even though its authoritarian government, unique modes of ‘state’ capitalism and particular history of land tenure mean that some features 221

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are unlikely to be replicated elsewhere. However, the implications for the state, as well as for the individuals concerned, of housing families has led to shocking policies, reminiscent of apartheid-era southern Africa, in the Global North (GN) too. In the UK, for example, the implacable determination of the Conservative government after the financial crash to impose austerity via swingeing cuts to welfare payments has meant that poor London families are sometimes being rehoused outside the city. As in contemporary Beijing, the ultimate expression of the outcomes of a lack of affordable housing is when there simply isn’t any. Then there is out-migration. At this point the conceptual differentiation between ‘forced’ and ‘voluntary’ migration becomes important, since housing factors do shape decisions about migration that are reasonably treated as ‘voluntary’. It is, however, evident that the out-migration caused by destroying thousands of affordable houses in Beijing is forced. Similarly, when London residents who become homeless and cannot find any affordable housing are rehoused outside the city by cash-strapped local authorities, their migration is forced. In London, the main reason why people become homeless is due to eviction from private rented units. Their local authority has a statutory obligation to rehouse them but the massive cuts in their budgets and the unaffordability of London housing are forcing desperate efforts to push some into cheaper accommodation outside London. The council most affected, as its high levels of poverty make homelessness more likely, is Newham. In 2015, 244 households were rehoused outside London, mostly in Essex, east of London, but some as far away as Birmingham and Leeds. This was estimated to be around one in 20 of the households rehomed that year.16 In Birmingham, this was seen as adding pressure to its housing shortages.17 The fact that housing benefit cuts would lead to related ‘displacement’ within and beyond London was predicted when these measures began to be introduced in 2010.18 Similar policies of giving ‘one-way tickets’ out of the city are also being used to move on rough sleepers – a different category of homeless people – in several UK cities, including Birmingham, Bristol, Exeter and Manchester. Some of these policies involved moving people ‘back’

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to their home town where they have ‘connections’.19 Ten out of 11 councils in London with the highest numbers of rough sleepers were doing the same.20 And the same happens in the USA, where thousands of city homeless are given bus tickets annually, a system that Jeff Weinberger, of the Florida Homelessness Action Coalition, typifies as a ‘smoke-and-mirrors ruse tantamount to shifting around the deck chairs on the Titanic rather than reducing homelessness’.21 In the UK, among those evicted and then ‘deported’ from the city, it is particularly disturbing that women with children are greatly overrepresented. Again, this was predicted by the UK Department for Work and Pensions, which in 2012 provided data showing that of those likely to be affected by housing benefit caps ‘46 per cent … were lone parents and 85 per cent had three or more children’, and 47% were in London.22 Thus, the very group of people so often identified as being among the poorest and most vulnerable in poverty studies across the world – female-headed households – are being picked out and removed from UK cities because of housing affordability issues. They are displaced from their social networks and, if moved from London, from the very place where they were most likely to find paid work. This is an appalling indictment of UK housing policy. It is also social engineering just as China’s hukou system is social engineering. It is an attack on families, on family life, and on families’ rights to the city. These strategies of forcing people to move out of the city over housing issues and selecting in particular the most vulnerable have parallels with evictions from cities in the Global South (GS). Yet those are more likely to attract adverse reports from international agencies such as UN-Habitat or the Centre on Housing Rights and Evictions (COHRE). One example was the notorious Operation Murambatsvina in Zimbabwe in 2005, discussed in Chapter 3. There were many other issues besides housing involved but the demolition of tens of thousands of backyard shacks, one of the most affordable housing solutions, if hardly ‘decent’, rendered hundreds of thousands homeless. The government maintained that most should leave the cities and return ‘home’ (usually to rural areas). Insidious justifications about ‘reconnecting’ rough sleepers moved out of UK

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and USA cities with families elsewhere are not that different. The operation also split families previously living together if they left the member most likely to earn income in the city. Housing, family formation and household composition

Official policies in which housing is used to influence household composition and the ability to lead a family life in cities are an attack on the family as the ‘natural and fundamental group unit of society’, which Article 16 of the UN Universal Declaration of Human Rights states is ‘entitled to protection by society and the State’. However, outside China, the effects of such policies are probably less than the indirect, non-institutionalised impacts of the housing affordability crisis. Every time decisions about marriage, childbearing, caring responsibilities for family members and, basically, whether families can live as a unit in one place are strongly influenced by the housing dilemma in the world’s large cities, the right to family life is being affected. The impacts are not easy to disentangle. For one thing, cultural norms relating to intergenerational sharing of housing are highly varied. At the start of this century it was estimated that around three-quarters of older people in Asia were cohabiting with their children or grandchildren, for example (including in rural housing).23 While economic factors affect such patterns, expectations about adult children (often sons, but not necessarily) caring for their parents play an important part. The influence of this on housing arrangements is less strong in many other contemporary societies; instead, there may be more of a presumption that young couples, in particular, will leave their parental homes to set up new households. The issue of how urban family formation and fertility outcomes are being changed by increased housing costs is also hard to determine since the decisions involved are complex and often highly personal (and family units can be problematic).24 It is difficult to ascribe them to single factors. Furthermore, once low fertility levels become entrenched, they may become cultural norms for which the original proximate causes are hard to disentangle. Yet urban and demographic studies have long theorised about the observed correlation between urbanisation and falling fertility. 224

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As Europe and North America are largely urbanised already, as is Latin America, such studies often draw on trends in Asian and African countries, where it is still possible to make meaningful comparisons between rural and urban demography. The causes are attributed to higher rates of female participation in waged labour, improvements in women’s education and general social status in towns, and better access to health systems and contraception. The higher ‘cost’ of urban children may also be added, usually relating to the perceived need to invest in education to increase their chances of success in highly competitive urban labour markets. However, whether and how urban housing costs play into fertility decisions are rarely considered. Nonetheless, the two ‘strategies’ for addressing the housing dilemma discussed here – squeezing the space or the conditions for family life, or both – may logically lead to lower fertility. The two interact, too, because limited space either deters or prevents family formation or forces household division. There is certainly suggestive evidence, particularly when considering the combination of the financial strains created by the housing debt-induced 2008 crash and the increasing costs of housing in large cities. In the UK, the birth rate in 2018 was at a 12-year low and the fertility rate (the average number of children born per woman) was 1.7. Rhiannon Cosslett, a commentator on British fertility, notes that ‘economics are a factor. Housing costs keep increasing while wages do not. There’s less spare cash to put aside for all the things a baby needs, not to mention childcare, which costs an astronomical amount.’ Many new jobs are in ‘the gig economy’ – usually low-paid with irregular hours and limited rights for new parents.25 She is careful not to ascribe too much to housing per se, but within cities all these factors are interacting: women tend to work outside the home, and this requires expensive childcare; disposable incomes to pay for housing are falling but housing costs are rising. Another impact of rising rents and house prices that has major implications for household formation and composition is the very significant surge in the numbers of young adults who remain living with their parents in the UK, particularly in London and the south-east. This shift began in around 2004, trending upwards more swiftly from 2008.26 One-quarter of all 20–34-year-olds were living at ‘home’ in 225

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this way by 2017, and a third of men (although women with children living like this are counted as separate households in UK statistics). Shelter predicts that, were the trends to continue, this situation would be true for over half of young adults within a generation.27 Those leaving home are increasingly sharing rental accommodation in circumstances not conducive to family formation, and ‘it is projected that numbers of younger (25–34) “other” (multi-adult) households will continue to increase through to 2039 – making up over 20% of total households in London’, while the proportion of this age group with children continues to decline.28 Such patterns are usually ascribed to the cost of housing, with those staying at ‘home’ trying desperately to save a deposit for house purchase or more simply unable to afford to rent and pay utilities as well as eat, travel to work and buy clothes. In Europe as a whole, nearly half of adults aged 18–29 in 2011 were living with their parents.29 There is certainly more to this than housing costs alone, with cultural norms playing their part, but countries such as Spain, Italy and Greece, with very limited public housing, are among those with the highest rates. An EU report on housing in 2015 summarised the situation in many EU countries in terms of a ‘housing trap’: ‘the rental sector is expensive’; ‘[h]ome ownership is not an option due to the even higher cost’; and there is insufficient social housing, ‘with waiting lists growing in a number of countries, including Italy, the UK, France and Ireland’. This has led ‘in many countries to the generational phenomenon that the majority of people aged 18–34 still live with their parents’, and a ‘large number of households … overburdened by housing costs … [which is] more evident in the crisis-ridden countries like Greece, where more and more families appear to have difficulties … cover[ing] their housing expenses’.30 The Council for Youth in Spain also attributes the inability of 80% of youths (aged 16–29) to ‘emancipate’ themselves from their parents to ‘the housing market as well as the lack of available jobs’.31 New household composition is far higher in countries with more social housing and regulation of rental markets, such as Denmark and Sweden, where only around 4% of 24–35-year-olds live with their parents.32 Greece, Spain and Italy also have Europe’s lowest 226

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total fertility rates at 1.38, 1.34 and 1.34 respectively, compared with 1.79 and 1.85 in Denmark and Sweden.33 Urban housing arrangements in both China and Japan are also being affected by affordability issues. In Japan, ‘prolonged recession and … restructuring of the labour market have resulted in the increasing share of adult children who reside in parental homes’.34 In China, now that PRH has largely been sold off, the next generation must rely more on the private housing market but ‘high prices in this market make housing less affordable to young families without assistance from their parents’.35 Housing research in Tianjin in 2009 found that it was becoming more likely for children to rely on their parents than the traditional pattern of supporting them and predicted that ‘the proportion of children depending on parents will be increasing, at least as long as housing affordability problems continue and younger generations are squeezed out of independent housing access due to the speculative housing boom in Chinese cities’.36 In Europe, rates of new household composition by young adults and total fertility rates are strongly statistically correlated. For the cohort aged 25–29 in 2016, the correlation coefficient was 0.72.37 Correlation does not prove causation and decades of fertility research have shown how it is influenced by a wide range of factors. It is a highly personal decision and not suited to precise predictions. Nonetheless, the correlation adds to the almost overwhelming body of evidence from interviews and qualitative surveys that housing affordability is affecting family formation. The plausible connections are obvious, relating, for example, to privacy and space, as well as expectations (or aspirations) which are observable in many societies that cohabiting couples (in the past marriage was usually the trigger) ‘should’ set up a physically separate domicile as a prelude to having children. In North African countries, it has been suggested that a contributory factor to the uprisings of the Arab Spring was the anger of youths ‘prevented … from marrying and starting a family of their own, simply because they did not have access to affordable independent housing’.38 These are far from new issues. The trend towards later marriage (and lower fertility) in the UK, for example, was influenced by the costs of establishing a new household in cities 227

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and began during the nineteenth century. However, as housing costs relative to wages increase, the links are strengthened. Rising rates of female participation in the workforce in the GN play their part as both cause and effect of women’s improved status but at the same time higher household incomes have become necessary to pay the rent or mortgage. In the UK, female participation in the workforce continues to increase, standing at 70% in 2018 compared with 80% for men. Of even greater significance for fertility decisions is that having children now makes no difference to a woman’s likelihood to be in the workforce.39 Important demographic changes have also been occurring in the USA in the past decade or so. The proportion of women in their prime childbearing years (20–39) who had never had children in 2016 was ‘12 percent more than demographers would have expected given child-bearing patterns just before the Great Recession’. The proportion having two or more children was also 10% lower than expected.40 Natural increase (births minus deaths) was the lowest in 35 years, despite there being more women in their most fertile years than before the crash, and natural decrease was occurring in 24% of urban counties. Rural counties were more affected but this is partly explained by their tendency to have relatively fewer women in the most fertile age groups due to migration patterns.41 The fertility rate, which had been fairly stable since the 1970s, fell after the crash. By 2017 it was at its lowest recorded level since 1978, at 1.76.42 Yet pre-crash data had suggested that house price rises in the USA pushed birth rates up. Although they depressed births among non-owners, this was more than compensated for by a positive effect on the fertility of homeowners. In net terms, the rapid rise in house prices ‘during the housing boom of 1997 to 2006 was associated with a 10 percent increase in births’.43 Since the crash, house prices in the USA fell but then rose strongly in many of the largest cities. Had the same conditions pertained, births might have risen. However, as in the UK, things have changed. The rate of homeownership is much lower for US ‘millennials’ compared with the previous generation (so-called ‘Generation X’, born between 1965 and 1980). Of those aged 25–34 in 2015, 37% were owneroccupiers compared with 45% of the age cohort in Generation X. 228

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Also, the age of marriage, which is associated positively with house purchases but negatively with fertility, had increased. A further factor is a notable shift in migration patterns for highly educated and thus richer millennials towards city centres. These have the best job opportunities but also the most expensive housing.44 The inevitable corollary was that, by 2015, ‘[a] decade after the housing bust upended the lives of millions of Americans, more US households [36.6%] are headed by renters than at any point since at least 1965’. For households with heads aged under 35, 65% were renting, up from 57% in 2006. Two-thirds of renters said that they did so because of ‘circumstances’, mainly financial, rather than choice.45 Although it is much less common than in Europe for young adults to live with their parents, this phenomenon has also increased in the USA, from 10% of those aged 25–35 in 2000 to 15% of that age group in 2016 – most of whom are employed. Possible causes are attributed to ‘the cost of living independently’46 and falling wages for the low-paid: in real terms, the wages of people without degrees have been falling for decades, ‘from $31,384 in 1965 to $28,000 in 2013’.47 People on such incomes are, of course, most likely to find themselves in the housing dilemma. Low levels of fertility are now the norm in most of the world’s highly urbanised societies. Of the 34 mainly highly developed and urbanised countries of the Organisation for Economic Co-operation and Development (OECD), only three (Israel, Turkey and Mexico) had fertility rates in 2016 at or above the level needed (2.1) to replace their populations. South Korea’s was the lowest at 1.2.48 Many of the largest cities in non-OECD societies have also experienced dramatic falls in fertility to below replacement level, including most cities in Latin America, from Buenos Aires to Rio de Janeiro and São Paulo, Delhi (1.9 in 2014), Bangkok Metro (0.9), Ho Chi Minh City (1.45), Colombo (1.8 in 2016) and Tehran (1.0 in 2014). The legacy of China’s one-child policy is now embedded in its demography, with astonishing outcomes in large cities: Shanghai, Tianjin and Guangzhou have the world’s lowest birth rates at four, six and seven per thousand. The average fertility rate (2.0) for all Indian urban areas is also below replacement.49 In many of these GS cities, just as in London, populations would be falling 229

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without net in-migration and the positive impact of youthful immigrants on birthrates.50 In much of the OECD, particularly for the largest cities, the nature of society and of the economy – of capitalism itself, given its reliance on geometrically increasing consumption – would be changing much more swiftly were it not for immigration. Internal migration may reduce, or be insufficient to maintain, big city populations, although this is not exclusively an OECD phenomenon: indeed, the extended Bangkok Metro Area is losing population relative to Thailand as a whole despite domestic migration and immigration.51 Immigrants are helping to maintain and further develop these societies. They are particularly drawn, for obvious reasons, to the cities with the strongest economies and best job opportunities – the very cities where the housing dilemma tends to be the worst. This provides the context for the worst excesses of the two ‘strategies’ which address that dilemma. One, already introduced in the previous chapter, is squeezing housing space. The other is squeezing family life. These can be combined and often are, particularly by migrants who thus often face the worst housing conditions of all in these respects. (Im)migrants and housing costs: unhousing and unsettling families

The problems faced by citizens born in societies where they struggle to attain affordable housing solutions in large cities are bad enough and getting worse. They tend to be worse still for many in-migrants to those cities. In countries where there is still the potential for significant in-migration from within the country, particularly from rural areas, these issues also affect ‘domestic’ urban labour migrants. These migrants usually far outnumber immigrants in urban areas in Africa, Asia and Latin America. Immigrants from outside the country have, however, the gigantic added handicap of being noncitizens (if they have not become ‘naturalised’). In many societies, this means that they do not have various legal rights afforded to citizens, and this usually makes it even harder to get access to any affordable housing supported by the state. The exception may be 230

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those with recognised refugee status – which can be extremely difficult to attain. Although in the world’s most globalised large cities there are ‘segments’ of labour immigrants who are highly skilled and well paid, and who have sufficient monetary demand to find decent housing among the market solutions available, very many labour immigrants to large cities are relatively low-skilled and thus likely to have incomes that place them firmly within the housing dilemma. Immigrants may also face discrimination from the citizen population and local institutions, although local in-migrants may do so too. The trait of city-born residents looking down on ‘rural’ migrants (‘country cousins’ in UK folklore) is a seemingly universal trope with deep historical roots. Aside from housing issues arising from outright discriminatory practices and the tendency for migrants in cities to earn less than established residents, there are many other ways in which migrants become over-represented among those living in seriously inadequate and overcrowded housing or households with divided families. Being, by definition, relative newcomers, they will be low on waiting lists for public rental housing, if they are allowed to apply at all. For example, immigrants frequently cannot apply. In China, those without a local hukou cannot apply. Immigrants frequently cannot do so either. Migrants are logically less likely to inherit owner-occupied housing from family members in the city or be able to rely on help from them to overcome problems stemming from periods of unemployment or illness. The most recent generation of migrants in cities ranging from the UK to China, from South Africa to eastern Europe, have missed out on the possibility of becoming subsidised owner-occupiers of previously public rental housing under the various privatisations of the late twentieth and early twenty-first centuries. In cities where land under indigenous tenure plays a part in providing housing, in-migrants are obviously not part of the local communities from whom those who stand to benefit are drawn; instead, they are often the tenants paying the rent. Where job markets are fiercely competitive, in-migrants with less local ‘social capital’ struggle to tap in to the connections that ease entry into better jobs with more security in the informal sector, let alone the formal sector, which will limit the type of housing 231

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they can afford.52 Migrants are less familiar than long-standing residents with the complexities of the local bureaucracies and corrupt practices which have to be dealt with to get better housing and jobs. These disadvantages combine to push them into the housing dilemma more often than their local counterparts. However, it is important to recall that the housing dilemma is not peculiar to migrants and in many cities most of those struggling with the unaffordability of housing will be city-born. Where migrants are crucially disadvantaged in housing outcomes in large cities is in terms of family life. In part this starts with some of the key characteristics of labour migration itself – migrants tend to be young and, even if they have partners and/or children, they often leave them behind at first while they seek work, a steady income and, of course, appropriate housing that might allow the family to be united. Others are single. In either case, the ‘shortterm’ solution of renting small rooms in shared housing, or sharing a room, is almost a rite of passage. Yet this solution can become impossible to escape. The hope to unite or establish a family in the city may be dashed by the intransigent gap between the costs involved and incomes. If there is a spouse and children at the place of origin, or parents and siblings for those who remain single, this may still be perceived as ‘home’ because kinship is such a key element of people’s lives and emotional security. In this way, new household composition is an almost essential part of a young migrant’s life as they have to leave ‘home’ to migrate, yet establishing a real home in the city can be very difficult. City-born young adults, however, being already at ‘home’, can avail themselves of the economic opportunities of the city without migrating. Indeed, because of the housing crisis, increasingly they are not even moving within cities to be away from their parents – they are ‘choosing’ not to form new households. There are, of course, many exceptions to these useful generalisations: large numbers of young people born in the city do leave home and rent rooms, and migrants may form relationships with someone from the city, earn enough to rent enough space to reunite their families, or decide to squeeze them all into a room or two in the city. For example, although the overcrowded rental units of the urban villages of the Indian city of Gurgaon are ‘overwhelmingly dominated 232

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by young men’ sharing rooms, as conditions and cost considerations ‘generally deterred male workers from bringing their families with them to the city’, some do eventually manage this, although the family usually ends up in a single room.53 Nonetheless, the unaffordability of housing can have different implications for young migrant versus non-migrant urban cohorts, and this manifests itself in ways that affect family life. Dividing families as a way of adapting to the excessive costs of living, especially housing costs, in large cities can become a way of life. Patterns of circular migration with workers moving back and forth between city workplaces and families in homes elsewhere do not have to be institutionalised to persist – they occur across the world. The cost of maintaining the whole family in town can be too high to make a city job worthwhile. Shifts in real pay levels and the cost of housing and other necessary expenditures in town can change the equations: higher pay levels can allow a surge in family in-migration but falling real incomes have the opposite effect. Thus, in the early decades of independence in Africa, family migration increased as wages rose, but when real incomes plummeted from the 1980s under Structural Adjustment Programmes, circular migration and family division again became more common.54 Housing costs in London are now increasing the incidence of these patterns for workers in the UK. Some family division involves well-paid professionals for whom upmarket family housing is affordable only in areas so far from the city that they choose to rent a room in London during the week, returning home at the weekend. However, for many on low pay, divided families are not a matter of choice and they minimise their Monday–Friday housing costs as far as possible, some even living in tents in outer suburbs.55 Beyond these broad patterns stemming from migration, there are disturbing ways in which migrants are pushed into problematic housing situations. Being disproportionately represented so often in the very lowest-paid cohorts, their sheer lack of purchasing power forces them towards exceptionally poor accommodation: cages, sheds, basements, tents, shacks, with limited water, sanitation and electricity. In cities where the majority of those in the worst work are migrants, it can seem that the most serious issues of 233

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housing affordability and appalling conditions are so concentrated among migrants that any analysis of the problems strays towards assuming that poor housing is a problem of migrants. Even worse, it can segue into presenting poor housing as a problem caused by migrants. This is confusing the symptom with the cause: the underlying issue is insufficient incomes. It is also extremely dangerous, since (im)migrants in most societies are too often used as a convenient scapegoat by some politicians and media to distract people from the structural issues affecting their rights and livelihoods. The next step can be arguments to the effect that ‘migrants’ (particularly those of rural origin) do not know how to, or do not want or – even worse – do not need to live in ‘decent’ housing and neither do they wish to live with their families. Arguments such as these were constantly put forward to ‘justify’ the ‘single-person’ hostels and lack of family accommodation provided for migrants in cities in white minority-ruled southern Africa. They are used more widely in situations where circular, temporary migration patterns to cities are not enforced but many migrants minimise their expenditure on rent by ‘choosing’ to live in overcrowded, inadequate accommodation. Again, this confuses the symptoms with the causes. First, poorly paid migrants who perceive that they will never save or earn enough to establish their family in bearable accommodation in the city do indeed often ‘choose’ to save everything they can by living in what may be miserable circumstances in order to support their family at ‘home’ elsewhere – it is a selfless act. They may also say that they do not want their families with them, but this is because this would be totally unaffordable or would mean everyone living in utterly inappropriate conditions for a family.56 The family stresses involved are enormous, yet, as the migration scholar Josef Gugler57 noted with reference to subSaharan African urbanisation processes, it is astonishing how little attention researchers have paid to these aspects of migration. The postcolonial surge in family migration and the swift normalisation of previously massively unbalanced sex ratios caused by colonial policies in sub-Saharan African cities were incontrovertible evidence that migrants are as likely as any other group to want to live together with their families. Furthermore, during the colonial 234

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period there was never-ending pressure from migrants for more married or family urban accommodation to be made available across Africa. Employers facing recruitment difficulties or needing to enhance the skill level of their workforce found an invariably successful solution was to expand family accommodation and relax or ignore restrictions on family migration.58 As the historian Vickery describes, in colonial Rhodesia: railway officials directly blamed the widespread desire of railwaymen to live with wives and families for their inability to keep up with housing demand. According to them, more building simply invited more dependents. In one case, ‘as soon as the material went on to the site, the single people were sending home for their wives. By the time the 50 [married] quarters were finished, we were short again’.59

The list is long of extra difficulties and painful adaptations facing domestic migrants searching for affordable housing in the largest cities. Nearly all these factors are compounded for immigrants. Their families are more likely to be left behind, even if they are allowed to accompany them, and the distances to visit them are further and the expense greater. Non-citizens have far fewer rights in relation to work, housing and family unification. The exceptions are cross-border migrants within the EU, but even these may end up in very poor housing. In the Czech Republic, for instance, recruits from Slovakia, Romania and Bulgaria, as well as non-EU immigrants, who work in electronics factories may live in tied dormitory housing.60 Immigrants are also more likely to struggle with language. They are over-represented in jobs with poor conditions and low wages, sometimes even if they are well-qualified and skilled, because of discrimination and non-recognition of their home-country certification. Their relative vulnerability in job markets and inability to draw on public income support systems during temporary shocks to their employability such as illness make them ‘popular’ employees for sectors with poor workers’ rights and pay and an inclination to try to pay ‘off the books’ without taxes or benefits, thereby increasing profits. Within cities, this includes construction sites and large elements of the service sector, such as cleaning, ‘caring’ work 235

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(looking after the elderly in particular), hotels, restaurants, fastfood outlets, taxis and deliveries. In sum, with far fewer rights and connections in the city, they are more easily exploited by employers who actively seek them out. For employers, there is a further advantage over domestic workers: immigrants tend to be young, fit and ‘single’ – or, if not, they often have no dependants in the city. They fit the profile of the ideal employee: less likely to go sick or ask for time off because their children or elderly relatives need them. Compared with the local workforce, which has a far less ‘convenient’ mix of age groups, women who may become pregnant, parents with children (and possibly elderly relatives) in the city, disabled and sick, all with various needs, demands and legal rights, from an employer’s viewpoint the ‘average’ immigrant worker is almost bound to be more profitable and less hassle. Yet there is a further, indirect, advantage of immigrant workers: their profile tends to reduce the costs of their housing. Local workers with long-standing roots in the city are established there with their families. Those with dependants need housing; indeed, in the GN they may be ‘expected’ by the state to live in housing that is commensurate with ‘decent’ standards, with sufficient space for the family. This is expensive. The reverse of the housing dilemma becomes crucial. Families in highly subsidised public housing may be able to ‘afford’ to work in low-pay sectors. However, household heads paying market rents or mortgages may not. Working-age dependants of established city families may ‘afford’ low pay, but they may aspire to establishing their own household and know that such pay will never allow this in their ‘home’ city. Inconveniently (for employers), therefore, over time they may push for higher wages and point out how impossible it is to build a future in the city for the pay on offer. Their rights manifest themselves in ways that reduce profits. There is thus a feedback loop between low pay and the inability to house families adequately in a market-based system in large cities: poorly paid people cannot afford ‘decent’ housing and those in ‘decent’ housing often cannot afford to work for low wages. For low-wage employers, families and their large housing costs are a nuisance. States that implement laws to constrain family life and

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associated urban housing for the domestic workforce, as in China or apartheid-era southern Africa, and allow mass provision of dormitories, hostels and other grossly inadequate housing types for the consequent circulating migrant workers are very ‘helpful’ in this respect. Elsewhere, such employers lean towards immigrant workers who provide some similar advantages. Of course, immigrants’ aspirations may not differ from those of ‘locals’, but they have far less power than local workers, and their perceptions of what is realistically achievable can be affected by their work and visa status. Without long-term rights, co-residing with their families may mean having to move on or return ‘home’. The dependence of the Gulf States on immigrant workers in construction and some other low-paid sectors required for their large cities is a prime example. The workers may have contracts for a year or more, they are divided from their families, and they are housed cheaply and separately from the local population. As Federico Caprotti, a UK geographer researching eco-cities, has argued, the development of these oft-vaunted new developments in the Gulf States, and elsewhere, often involves the denial of immigrant and migrant workers’ rights to the city and decent housing. The result can be: the formation of temporary cities housing the urban construction workforce. The workforce coalesces around construction sites and then moves on within the city or across thousands of miles to work on the next large project. The geographies of these ‘new urban poor’ … is significant. For example, in China, construction workers alone number about 50 million, of which 90% are migrant workers.61

For most of the 100,000 Bangladeshi men in Singapore, also working mainly in construction, ‘the hardest part is being away from their families’. As one migrant worker there, interviewed for BBC News in 2015, lamented: ‘When I work I miss them, when I sleep I also miss them.’62 Such workers do not have rights to Singapore’s high-rise subsidised housing in which most citizens are accommodated; many live in ‘official, registered dorms in converted factories,

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walkup apartments, and shophouses [which] are often cramped and overcrowded – and “slum-like”’.63 Such cities are deliberately ‘designing out’ workers and their families who can never afford to be housed within them. In Russia, the main targets of the remnants of urban registration systems are now also ‘foreigners’ – many of whom would have been Soviet citizens before the breakup of the Soviet Union64 but are now treated as immigrant workers. The low-pay, poor-housing, divided family nexus works out worst of all for undocumented immigrants. With no rights, and vulnerable to deportation, they are likely to take any work offered by unscrupulous employers and are unlikely to have dependants (unless they have flown under the radar for many years). Yet they need somewhere to stay and sleep. In the GS, cheap rooms in informal settlements may fulfil this need, even in the biggest cities. In the GN, employers, wishing to ‘hide’ such workers from immigration officials and also knowing that the wages paid cannot cover local rents in regulated housing, may provide accommodation. This is where some of the worst housing conditions of all may be found: overcrowded, unheated, vermin-ridden slums on a small scale. Such conditions can be found in houses on ordinary streets or in backyard sheds and row housing, hidden from view. Some employers even deduct ‘rent’ from wages. The pay and working conditions of undocumented city workers are usually illegal. Trafficked workers, whose migration is forced and who are trapped in virtual slavery working for specific employers, may be compelled to work in outright illegal occupations and will almost always live ‘on the premises’. The circle unsquared: ‘choosing’ to leave the city

The final migration ‘strategy’ when the struggle to adapt to the pressures of unaffordable housing and the impact on family life can no longer be managed is to leave the city ‘voluntarily’. This is another worldwide process found in both the urban GS and GN. Draconian policies are not always required for major out-migration of urban residents to occur. In sub-Saharan Africa, as noted earlier in this

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chapter, the dramatic falls in real urban incomes during the 1980s and 1990s due to the imposition of neoliberal policies increased circular migration and reduced rates of net in-migration to cities in many countries, with fewer people moving in but also more moving out. In some, such as Zambia during the 1980s and 1990s, the shifts were sufficiently large to reduce the urban share of the national population. As housing costs play a large part in many urban budgets, the increasing difficulty of paying rents was involved, as shown by the longitudinal research on migrants in Harare, Zimbabwe, discussed in Chapter 2. Once influx controls on migration were lifted, at first there was a strong shift towards migrants living with their families in the city, or planning to unify them, and migration contributed strongly to urban population growth. Yet cost-of-living issues combined with no state safety net for the unemployed, ill or old meant that most migrants, fearing destitution if things went wrong, kept up links with their (usually rural) birthplaces and envisioned that one day they would return there.65 Housing costs and the impossibility of paying rent when too old to work were writ large in perceptions of options for the future. As one migrant said, ‘I would stay but housing and money are the main problems.’ Becoming an owner-occupier was often seen as a key facilitator for remaining in Harare, especially for the old, because then housing could generate income because rooms could be let, instead of being a constant financial drain. One migrant felt that living permanently in the city might be possible ‘if they had a house’, and another said that homeownership ‘would be good for them, they would be able to afford the cost [of city life]’. Having access to rural land for farming and building a house for the future influenced people’s views – the landless were less likely to plan to leave the city. However, these patterns changed as urban incomes shifted. In 1991, structural adjustment policies were implemented and the formal urban economy and real incomes declined sharply. Very quickly both those with land and those without increasingly felt that they would eventually have to leave. By 2001, when urban incomes had further declined, around three-quarters of all migrants surveyed in that year were expecting to have to leave the city in the future.

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The semi-forced nature of these decisions was clear from the litany of explanations about rising costs, including for housing. People also often alluded to ‘the privations and social difficulties they faced daily due to overcrowding in their accommodation as many had only one, or perhaps two, rooms for an entire household’66 – for them ‘squeezing the space’ could become intolerable. Significant changes are also occurring in migration patterns related to large cities in the GN. In the USA, the largest cities (metro areas) with populations over a million, housing 100.2 million people in total, experienced net out-migration of 398,000 of their domestic population in the year to July 2017. This was characterised as a phenomenon that was ‘reshaping America’.67 London is another example. From 2001 to 2016, internal (domestic) net out-migration from London averaged 71,000 annually. It was international migration that kept the overall migration balance positive.68 However, a downward trend in the numbers of long-term international migrants (excluding those staying less than 12 months) and an upward trend in the numbers of internal outmigrants tipped the balance in 2016, when London began to lose population from migration overall (see Table 9.1). In net terms, London lost around 100,000 residents through internal migration in that year and 23,000 overall. Moving to the suburbs is, of course, a well-established urban pattern for the middle classes seeking space and a particular lifestyle, but the underlying factors in much of this out-migration are rather different. First, many suburbs are within London’s boundaries so moving to these would not show up in these figures. Second, the ‘commuter belt’ is becoming more far-flung because of housing costs,70 with London workers increasingly trying to commute daily from parts of counties previously regarded as impossibly far.71 In many cases the stresses on the worker and their families prove overwhelming and the strategy falls apart. Sometimes the ‘worker’ tries renting a room in London during the week: the strategy of both dividing the family and ‘squeezing the space’. Third, the commuter option has its limits, houses in the south-east are also relatively costly, and many London residents are ‘choosing’ to move much further to find work and

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36,845 16,272 53,117

41,175 13,659 54,834

25,657 6,901 32,558

2016–17

Source: Calculated from data in Office of National Statistics dataset on Local Area Migration Indicators United Kingdom at www.ons.gov.uk/ peoplepopulationandcommunity/populationandmigration/migrationwithintheuk/datasets/localareamigrationindicatorsunitedkingdom.

83,488 −106,608 −23,120

114,225 −93,302 20,923

126,390 −77,535 48,855

2015–16

2014–15

2015–16

2014–15

2016–17

South-east England

London

Note: For definition of long-term international migrants, see text.69

Net long-term international migration Net internal migration from rest of UK Net total migration

Migration flow

Table 9.1  International long-term and internal migration: London and south-east England, 2014–17

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homes elsewhere. Under a banner headline ‘Number of Londoners abandoning capital hits 10-year high’, one UK newspaper reported in 2017 that: The urge to quit London is so widespread that only a handful of the remotest corners of England and Wales did not see at least someone from the capital arriving to start a new life last year … driven by people leaving London’s relatively expensive housing market but also by financially squeezed councils sending homeless families out of the capital.72

Fourth, a 2015 report by the London School of Economics found that 80% of domestic London out-migrants to the south-east were non-graduates.73 These are more likely to be drawn from the income groups for whom the unaffordability of housing in the city would have been most pressing. Fifth, as also shown in Table 9.1, net internal migration from the UK as a whole to the south-east is falling, totalling only about 7,000 people in 2016–17 to a region with a population of nearly 9 million. These migration trends predate any possible impact of Brexit, which in any case would primarily affect international migration. When the migration figures are disaggregated by age, as expected there tends to be net internal in-migration among working-age groups and net out-migration of older groups as some people choose to retire away from large cities. However, in 2016–17, the net out-migration from London to elsewhere in the UK of children aged under ten years (−30,450) was much higher than that for those aged over 60 years (−16,200). Yet these migration trends occurred while London had very low unemployment. It has long been the world’s global financial centre (although this may change if the UK leaves the EU). It is one of the world’s top tourist cities, abounding with culture and leisure amenities. It is a safe city by world standards. The problem is that its housing crisis is overwhelming. It has overwhelmed its families and its society and has drowned out the ‘economic’ signals of the job market. On the other hand, given its central role in the neoliberalisation of world capitalism with its prioritising of market forces over the mitigating policies of state welfare, this manifestation in 242

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London of the raw experience of the housing dilemma is not surprising. From the narrow and disheartening perspective of the city’s economy as an element in global capitalism, this may not matter. Indeed, it could be presented as economically advantageous. If departing households are families, no matter what economic role the working members played in the city, in large ‘global’ cities they can usually be replaced. A replacement worker with no dependants may well be regarded as better by most employers. A ‘single’ replacement worker whose family lives elsewhere in the country is nearly as good. An immigrant replacement worker divided from his or her kin may be seen as best of all. From the viewpoint of the local state, in economic terms single people are also better: they contribute to the tax base but make far fewer demands than families on its infrastructure, including expensive health and education facilities and personnel (if these are provided by the state). Where the local or central state does subsidise housing for some groups, reductions in the demand from families with children is a boon. It may seem much better, for the city, for all these costs to be borne elsewhere by other local authorities, or even by other countries. In fact, when it comes down to it, why do cities with thriving, profitable, attractive economies that can draw on workers produced by households elsewhere need to house families at all?

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Chapter 10

Conclusion

The question posed at the end of the last chapter – do cities need families? – was deliberately provocative. Cities are not just economic engines and they should not be depicted as such. Most of humanity now lives in urban settlements and our future requires that they are understood and claimed as our homes as well as the places where our livelihoods are based. In reality, cities are comprised of people, rather than the value of their production. Nonetheless, it is believed that the trajectory of the story of city housing and its affordability for city residents – the people whose work makes the city ‘work’ – has entered a new phase in this century. There has always been a struggle over urban housing but the extraordinarily rapid rises in housing prices in the twenty-first century – in the run-up to the financial crash and afterwards – have reshaped the parameters. National and international surveys by governments and privatesector actors (e.g. property developers and estate agents) almost vie with one another now to list the most unaffordable cities.1 Is it Hong Kong? Beijing? Sydney? London? Los Angeles? Luanda? Singapore? Kiev? Mumbai? Tokyo?2 All of these, and others, figured in surveys reported in the media in 2018. There is no clear answer as surveys use different methodologies and are rarely comparable – it is the rising obsession with the topic that is most telling. Some use median incomes related to median house prices and the 244

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focus is usually on house purchasing. This is a severe limitation, given that for many in the housing dilemma the real issue is rents. Private-sector surveys may make no attempt to include the realities of local incomes and housing markets in ‘irregular’ low-income settlements in the cities of the Global South (GS) and thus present a very misleading picture. The survey may consider only the costs for foreigners (expats) needing short-term, relatively fancy accommodation – this explains the appearance of Luanda in Angola in these ‘contests’. The Bloomberg Global City Housing Affordability Index, using self-reported data on take-home pay and various indices of housing costs, reported that in 2017 no one with an average income could buy or rent in the 105 cities they covered. The type of housing they were considering, however, was the purchase of 1,000 square feet of housing or renting a three-bedroom residence, and they assumed expenditure over 28% of net pay to be ‘unaffordable’. Yet even if 50% of net average pay went on housing, only 12 of the 105 cities became ‘affordable’. Their ‘top ten’ unaffordable cities were Caracas (which can be discounted due to the use of US dollars in the index and the country’s impossible inflation and currency swings), Kiev, Hanoi, Mumbai, Buenos Aires, Bogota, Moscow, Rio de Janeiro, Beijing and Shanghai (the full list is found in Appendix 1). In all these cities average rents greatly exceeded total average pay – being two to three times higher except for Buenos Aires. Buying was even more absurdly impossible, not surprisingly. In Hanoi, Mumbai and Buenos Aires, for example, average mortgage payments were around eight times higher than average pay. It is easy to critique an index such as this, which demonstrates all too well the segmented nature of housing markets in most of these cities and the perils of peculiar sampling. The majority living in the sorts of housing they can afford will not self-report to the online database used by Bloomberg to compile its index, nor would their housing be of interest to Bloomberg’s subscribers. Yet it is useful. It helps challenge any assumption that those struggling with housing costs in such cities are only found in settlements that are (or were) informal – that it is a manifestation of ‘typical’ GS poverty. It is city-specific and indicative of the global scope of the ‘big city’ housing affordability crisis. It demonstrates that it also seriously affects formal-sector 245

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workers in planned, legal accommodation. Finally, it highlights the dominance in the unaffordability stakes of the big cities of the GS, as should be expected given the distribution of the world’s urban population. In western Europe, the index finds London to be the least affordable city. Housing datasets are also produced by the IMF and OECD. However, although these are based on more rigorous data, they are disaggregated by country, rather than city, thus obscuring the crucial differentiation in housing costs between the largest cities and the rest. They are thus better suited to tracking broad trends. The IMF’s global real house price index soared from 100 to 159 between 2000 and 2007. After the financial crash it fell to 143 at the start of 2012, since when it has steadily climbed again, reaching 160 by the end of 2017. The rises are widespread geographically. IMF housing cost data are available at a national level for OECD countries and a selection of others across the globe (although, for Africa, only South Africa is represented). As shown in Table 10.1, in 48 of 63 countries real (formal) house prices increased over the year to March 2018. There are no clear patterns by region or ostensible status as GS or Global North (GN). The OECD’s housing data have the significant benefit of disaggregating some indices by income bands and by tenure.3 These include affordability, termed as ‘housing cost overburden’ and defined as spending over 40% of disposable income on all housing costs including taxes, services and utilities. As expected, these nearly always show that the lowest two quintiles of households by income suffer considerable cost overburden. Yet, for the purposes of tracking trends in affordability between age cohorts affected by changing policies and in the largest cities, there are many limitations. First, although most European countries’ data are based on the EU Income and Living Conditions survey, the others use a variety of different sources that may affect data compatibility. Second, the data are national averages for the various indices collected, including rural housing, which means they are not good proxies for conditions in the largest cities most affected by high prices. Third, the affordability time series data available cover only 2010–14. Fourth, being OECD countries, there is limited coverage of the world’s poorer societies. 246

House price to income index 2010–18 – 115.8 – 117.7 116.2 – 116.2 – – 113.9 113.3 122.9 101.5 – – 110.7 107.9

Percentage house price change 2017–18

11.8 11.1 10.4 9.0 8.6 7.2 7.1 6.7 6.4 5.7 5.7 5.5 5.4 5.3 5.3 5.0 4.8

Country

Hong Kong Ireland Iceland Portugal Slovenia Philippines Netherlands Croatia Thailand Spain Czech Republic Canada Latvia Macedonia Bulgaria Luxembourg Germany

UK Belgium Cyprus Japan Poland Sweden Estonia Mexico Taiwan Singapore Finland South Africa Korea Israel Greece Indonesia Turkey

Country

1.9 1.6 1.6 1.5 1.4 1.2 1.0 0.8 0.7 0.6 0.6 0.4 0.3 0.2 0.1 0.0 −0.3

Percentage house price change 2017–18

(continued)

107.8 100.6 – 101.7 97.9 105.0 94.2 – – – 95.3 99.0 92.8 – 95.4 – –

House price to income index 2010–18

Table 10.1  Real (formal) house price rises in 2017–18 and house price to income ratio for 2010–18 in selected countries

4.8 4.4 4.1 3.9 3.9 3.2 3.0 3.0 2.9 2.6 2.5 2.4 2.3 2.2 2.2

Percentage house price change 2017–18 113.2 107.8 – 109.2 108.6 – 106.1 102.3 –   95.0 – 112.3 – 100.3 –

House price to income index 2010–18 Chile Switzerland Morocco Italy Vietnam Norway Serbia Brazil Kazakhstan Russia United Arab Emirates Peru Qatar Ukraine

Country

−0.4 −0.9 −1.2 −1.2 −3.0 −3.0 −4.3 −4.4 −5.3 −5.5 −8.6 −10.1 −11.5 −17.1

Percentage house price change 2017–18 102.8 105.8 – 92.3 – 105.4 – – – – – – – –

House price to income index 2010–18

Source: Compiled from data in IMF Global Housing Watch at www.imf.org/external/research/housing/index.htm.

Notes: House price rises are over a year to the first quarter of 2018 (or latest available); price to income index data are to the last quarter of 2018 (or latest available), 2010 = 100; – = no data.

New Zealand Hungary Colombia United States Slovak Republic China Australia Denmark Malta Lithuania Romania Austria Malaysia France India

Country

Table 10.1  (continued)

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They do, nonetheless, indicate key issues (see Appendix 2 for the data). One is the scale of the variability between countries, demonstrating the importance of income and urbanisation levels and the impacts of the mix of past and present housing policies at national level. For the lowest-income quintile: Greece stands out as having the most severely unaffordable housing in all tenure categories and Germany the least; the unaffordability of buying or private renting is at extreme levels in Spain, the UK, Lithuania and Hungary; and in some countries even when rents are subsidised, the levels of support are too low to prevent major cost overburdens for most of the poor, the worst affected being the UK, Sweden and Romania. However, the data also show that, as expected, households paying subsidised rents or owning a house outright are generally least likely to experience cost overburdening. For the lowest-income quintile, in half of the countries where data are available, it is also more affordable to have a mortgage than to rent privately. The OECD data also show that in 34 of 39 countries average expenditure by all households on all housing costs increased between 2000 and 2013. The neoliberal ideology still dominating contemporary capitalism created the conditions illustrated by these data whereby housing in global cities has become much less affordable. It also promotes the dominant explanatory narrative that suits so many vested economic interests: that this is a problem of supply that can, and should, be solved by market forces and private enterprises. The key argument of this book is that it is not. Or, at least, for the hundreds of millions for whom urban housing affordability is a critically pressing issue, it is not. By (re)presenting the issue as one of incomes, the nature of the struggle and possible solutions come into sharper focus. The primacy of market forces is not denied – indeed, it is emphasised – but in relation to the determination of incomes. It is these which drive the sharp end of problems of housing affordability in all cities. These problems are most evident in big ‘global cities’ because the gap between incomes (wages, pensions, benefits) and housing costs is largest in those centres. This point has been reiterated throughout this book as it has important implications for our understanding of the nature of the contemporary urban housing dilemma. There is much variation in housing prices and rents 249

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between urban settlements in the same country, reflecting their relative economic strength and demography. The scale of the housing dilemma in many towns tends to be less significant than in the largest city or cities that are most embedded in the global metropolitan capitalist system of financial and labour migration flows – the centres to which global capital ‘hops’ without touching the spaces in between, as described by the anthropologist James Ferguson.4 More households at the lower end of national income distributions (although not the very poorest) may get by in smaller towns when, without access to state housing subsidies, they would be homeless in the larger cities. For the UK, this uneven geography of urban housing affordability is strikingly evident from the online interactive rent and mortgage cost maps on BBC websites discussed in Chapter 8. In September 2018, these showed that those able to pay the average national mortgage or rent for a two-bedroom property could house themselves in 46% or 38% of the UK respectively, generally in towns and areas considerably distant from and to the north and west of London. The other side of this coin, though, is that work is harder to find in such areas and pay tends to be lower. An astonishing 35% of the new jobs created in the UK between 2007 and 2017 were in London, which has only 13% of the population.5 Thus households without a working member or other source of income, such as the single-parent families being rehoused out of London to such places, will struggle to escape the housing dilemma despite cheaper housing. The geography of the world’s most expensive cities shifts too: the top end of residential property markets in many global cities lost pace or experienced falling prices from around 2017, including cities as disparate as New York, Mumbai, Sydney, Seattle, Rio de Janeiro and London. At the same time, prices soared or continued their upward trend in other major cities, the fastest growth being in Berlin, İzmir, Reykjavik, Vancouver, Hong Kong, Budapest, Hamburg, Munich, Rotterdam and Frankfurt, all of which saw prices rise by over 13% in 2017.6 In the UK, the rate of increase in prices in other major cities, including Manchester and Birmingham, accelerated as investors looked beyond London. As Chapter 7 explained, high-end properties

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across global cities had generally proved highly profitable after the 2008 crash and footloose investors, dismayed by the generally low yields from safe investments resulting from the easy money that governments were providing to save the world’s financial systems, flocked into the market. However, developers ignored the limits of the super-prime market and the consequent rash of luxury residential units, often in skyscrapers, eventually began to exceed demand. Government actions to constrain overseas investments in such properties also played a part. There have also been issues with very high recurrent service and maintenance charges, which can increase exponentially for buildings over 200 metres tall. Nor has the super-prime market proven immune to the dangers of deregulating building standards. In 2019 in Sydney, after a rash of serious building defects in the top end of its housing market, it was declared that there was a ‘crisis in Sydney’s residential apartment market’, and Australia’s premier conceded that: ‘We allowed the industry to self-regulate and it hasn’t worked.’7 Many new-build luxury flats in the world’s large cities have thus had to drop their prices.8 However, the scale of the expansion in the gap between typical housing costs and what low-income groups can afford has been so large that such shifts have little relevance. For instance, when prices finally started falling in Vancouver in 2019, they had already risen 80% in the five years to May 2018 and homelessness was at an all-time high.9 In Haringey in London – once considered a relatively affordable area for ordinary working people – house prices increased by 298.1% between 1998 and 2018 but fell by a mere 0.74% between 2017 and 2018.10 Median house prices in London in 2019 were still 12 times average earnings and it was estimated that although 42,500 homes per year for sale or rent at below-market rates were needed over the next five years, only 3,500 were likely to be built.11 The skewing of the housing dilemma towards the largest, most economically vibrant cities within countries is a crucial analytical point. As noted earlier, analyses of rents and house prices that use national averages obscure the extent to which the problem is concentrated within the largest cities, as do examples of smaller cities where the impacts of the financial crash on property prices have

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not yet been ‘resolved’. Another way of demonstrating this skewing is by understanding how it shapes the geography of urban poverty – which provides better insights into the workings of the housing dilemma than a focus on price. In the UK, the government provides two sets of data on poverty based on income before and after housing costs (BHC and AHC). For the period 2009–11, the Child Poverty Action Group found that only 17% of London households were classified as ‘in poverty’ BHC. However, once housing costs were factored in, the proportion doubled to around 35%. This transforms the poverty map of urban Britain: the risk of being poor in the UK is at its highest in AHC-London but only around the average for BHC-London.12 The government’s methodology subsequently changed, but AHC-London remained the poorest area in the country in 2018. The fundamental significance of the housing dilemma for human welfare is thus illustrated. Similarly, in the USA, a Brookings Institute report in 2018 explained how, in San Francisco, a household earning $117,400 could be considered ‘low-income’ as housing costs there are so high they could be eligible for state housing assistance. Earnings of $73,300 would be classified as ‘very low-income’.13 Such incomes include workers whose professional status would put them among the middle classes, so there are parallels in these GN figures with the urban housing issues faced by the middle classes in some GS cities. In sum, global cities may be wealth creators but they are also poverty creators. Since insufficient monetary demand, rather than market supply (which must be profitable), drives the housing dilemma, housing needs to be analysed and understood as party of the poverty nexus. This is fiercely resisted by politicians wedded to notions about minimising the role of the state, apart from its enabling functions for the ‘efficient’ workings of markets and entrepreneurialism. For them, the sheer scale of the gaps between the price of ‘decent’ housing and the incomes of those in lower- or even middle-income bands is inconvenient, unbelievable, ‘fake news’. Redefining affordability in absurd ways to draw attention away from the issue is preferable to accepting the implications of the statistics. Launching yet another new initiative that helps only those in the income distribution a 252

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percentage point or two away from affording homeownership – and such initiatives are generally about buying rather than renting – is another political distraction technique. This is analogous to food policymakers focusing on subsidising cake rather than the price of bread. Wishful and woolly thinking about ‘the market’ also plays a part, as when Jim O’Neill, who had been both a chair of Goldman Sachs Asset Management and a UK Conservative Party Treasury minister, wrote in 2018 in the Financial Times about ‘the housing crisis. It is hard not to think that the market is broken … Surely we need a market where owning a home is more affordable and in which social housing no longer carries with it a stigma.’14 This mistakes the issues (perhaps deliberately), since it was the increasing reliance on ‘the market’ that exacerbated the housing crisis. In other words, the market is not broken; instead, as has always been the case, it leads to some horrible housing outcomes for many households who cannot afford anything ‘decent’, and they become more horrible the more the market is ‘unbroken’ (i.e. unregulated and unmitigated). Suggesting that the ‘market’ needs to have more, well-regarded, social (i.e. non-market) housing also makes no sense. However, things fall into place if ‘market’ is replaced with ‘systems of housing provision’ or even simply ‘cities’. Grasping the nettle that market forces could never house significant sections of the urban population in decent conditions took half a century or more, and the impacts of a global war on mindsets and values, for ‘Western’ governments. The mindsets wielding the most power over housing policies and investments across the world are very different now. The situation is illustrated by trends in Indian housing policies, as summarised in 2018 by Shirish Patel, Jasmine Saluja and Oormi Kapadia: India’s social housing programmes, always reluctant and faltering, have slowed and now more or less stopped … Market forces are expected to deliver housing for all, from the very rich to the very poor. Recognizing that this is not working for the poor, the government is providing financial assistance in a variety of ways to anyone constructing low-income housing. Beyond these incentives, no projects or policies are proposed that would actually deliver low-income housing.15 253

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Work by economists on housing affordability is often reflective of contemporary ideological norms and dismissive of interventions or of the problem itself. In a 1995 paper on the ‘concept of housing affordability’, J. David Hulchanski, an American economist, maintained with reference to the USA that: ‘There is simply no escaping the fact the household consumption patterns and the means by which households meet their needs are as diverse as the individual humans and their life situations who comprise these households … housing researchers need to avoid using the term “housing affordability”.’16 Yet, even though these positions are promoted by some of the wealthiest and most powerful vested interests in the contemporary world, they do not have everything their own way. They continue to be challenged not only by those needing affordable housing but by a legacy of legal statutes, researchers, public officials, lobbyists and advocates trying to protect the understanding of housing issues that underpinned the widespread implementation of solutions such as PRH with rents linked to typical incomes, government help with rents or rigorously implemented controls over private rentals. There are still many actors in the field of housing advocating progressive, pro-poor approaches. None is without its drawbacks but many have stood the test of time and have helped improve housing conditions by recognising the hard constraints arising from low incomes. Their voices have not been silenced; it is just that, for decades, they have been increasingly drowned out by the siren calls that formal-sector market forces and cost recovery can supply the needed housing. Academics and policymakers in both the GN and the GS still debate the precise meanings of ‘housing affordability’ or ‘affordable housing’ and which measures of household income should be used as the baseline when estimating how many are ‘challenged’ by housing costs because these exceed more than 30% of their incomes. Discussions continue about whether the often used 30% limit is too arbitrary or works reasonably well as a guideline, at least for many in lower-income bands. Related analyses show that there is considerable overlap, not surprisingly, between those recognised as ‘poor’ by their governments and those struggling with the cost of housing. However, the scale of the housing dilemma varies significantly 254

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depending on the assumptions made about necessary expenditures and housing standards. In the USA in 1999, for example, 14.41 million households, 14% of all households, were considered to be in poverty, nearly all of which (93.4%) also suffered ‘housing-induced poverty’. This latter measure, devised by Nandinee Kutty, estimates those who, after paying for their housing, could not afford the government-determined ‘basket’ of non-housing goods required to be officially ‘non-poor’. However, she also found that a further 3.77 million households among the ‘non-poor’ category were in this position.17 Thus government poverty data were underestimating the significance of housing costs. In total, she estimated that 16.8% – one in six – of all American households were suffering ‘housinginduced poverty’ at that time. However, research by the late Michael Stone, recognised by Kutty as ‘the intellectual parent of the housinginduced poverty measure’, suggests a far worse situation. He argued that the Bureau of Labor Standards’ ‘lower standard budgets’, which were calculated until 1981 then abandoned as neoliberal policies were implemented, are a more realistic and fair estimation of the costs of non-housing necessities in the USA. Using and updating these, his estimates for 2001 of those in what he termed ‘shelter poverty’ were far higher than Kutty’s: 32.1 million households, of which 15.1 million were renters and 17.0 million were homeowners. That put almost a third of American households in shelter poverty at the turn of the century. Stone’s approach showed that large households (e.g. with children) are far more likely to be in shelter poverty than small households. This is significant, since analyses using the standard 30% cut-off for all income bands for reasonable housing costs show the opposite. Factoring in childcare costs makes the situation even worse.18 These are important indicators of the particularly problematic impacts of unaffordable housing on family formation. These debates and their policy implications are mirrored in societies across the world – by no means are they confined to the GN. As shown in Chapter 2, the housing policies of the first post-apartheid government in South Africa were shaped by income analysis proving the sheer unaffordability of market-priced options for the majority. The Zambian JCTR, when publishing data on poverty in 255

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Lusaka, makes cogent arguments that unless these factor in the cost of housing of reasonable standards, the statistics implicitly accept that the problematic housing typically sheltering the poor is not an aspect of poverty. Indeed, were this to be applied across the world, the incidence of urban poverty in different countries would be much higher than usually reported. Although this would not serve to construct cross-country comparisons, given the vastly different poverty methodologies used in different countries, it would highlight the significance of housing costs and conditions in the poverty nexus. Yet, although national poverty data in countries with extensive informal housing may underestimate poverty, the incidence of absolute poverty (the inability to buy enough food) has fortunately been decreasing across the world. This includes, now, most subSaharan African countries, where conditions had often worsened in the latter decades of the twentieth century. This generated a growth industry in analyses about the rise and role of the ‘middle classes’ across the GS19 and helped fuel the development of new housing projects. Yet the financial capacity of these groups to afford formal, market-priced housing in large cities is very variable. In Africa, for example, a decade-long commodity price boom from around 2003 led to a flurry of exuberant reports on ‘Africa Rising’. It also generated some muddled presumptions about an equivalence between population groups in the middle of national income distributions (a statistical measure) and the middle ‘classes’, who, however customarily and differently defined by political economists or sociologists, are usually associated with consumption norms, including housing types, requiring incomes considerably higher than those actually typical of these middle-income bands in many of the world’s poorer countries. There are thus many unaffordable projects in GS cities that have been explicitly promoted as solutions for ‘beneficiaries’ or income groups – sometimes including those with no possible middleclass attributes – who had little or no chance of living in them, as illustrated by the African examples detailed in Chapter 7. Often this is pure cynicism on the part of developers and governments, although sometimes it seems to be their inability to grasp the reality of what is really affordable. Again and again, a conviction that the cost of formal, titled housing can be reliably recovered from households 256

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on low incomes (whatever their ‘class’) in large cities is found to be misplaced. In many GS cities, the incomes of many who are occupationally ‘middle class’ do not stretch that far. Indeed, the problem is now affecting many in the middle classes of GN cities. Even when schemes are government-backed, assumptions made about the loans or rents that households can service are unrealistic – sometimes extraordinarily so. As in the African examples discussed earlier, the state may then pick up the tab to prevent the housing being empty. In other cases, so-called ‘affordable’ houses, backed by government policies but built by the private sector, may be bought but require expenditure so far beyond the reach of the groups most affected by the high costs of housing that their designation as ‘affordable’ is Orwellian. In the UK, for example, in 2017 the Chartered Institute of Housing criticised the government for the ‘huge drop in the number of “genuinely affordable” homes built’ since 2010, as the production of homes at truly affordable ‘social rents’ (about 50% less than market rates) had fallen from 36,000 in 2010 to just over 1,000 in 2016. After this point the government stopped funding them, yet 80% of the housing budget up to 2020–21 was allocated to subsidising private homeownership schemes publicised as helping the housing crisis.20 When PRH areas are demolished by property developers who are ostensibly then required to build some replacement rental homes, these need not be similarly affordable. This means that ‘a four-bed social rented home charged at 40% of market rent can be replaced by a single room [so-called] ‘Affordable Rent’ property charged at 80% of market rent’.21 Whether in the cities of the GN or the GS, these siren calls for market solutions do not, and cannot, yield solutions for those in lower-income bands. They do, however, yield unwarranted political capital from the opportunities for patronage once subsidies become inevitable and nice photo opportunities for politicians (often in high-vis jackets) to demonstrate their ‘commitment’ to ‘affordable’ formal housing either to their constituents or to visiting foreign dignitaries. Yet even if housing costs compared to local incomes are properly factored in to poverty mapping and assessments, the full implications of the housing dilemma may still not be realised because this 257

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cannot account for the invidious effects, at the personal and societal level, of what might be termed ‘urban demographic sifting’ – the shaping of household size and composition by housing costs and employer preferences. Marx theorised that capitalism needed to pay workers not only for their labour power but also for the costs of the reproduction of labour. Workers had to regenerate their ability to work by resting, sleeping, eating, drinking and keeping warm. They also had to reproduce the next generation of workers. As Marx observed, employers have a strong incentive to pay only what is ‘strictly necessary’22 for the reproduction of labour. The problem for housing as an element in these equations is that, while it is possible to agree the amount and sort of food and sleep needed to ‘regenerate’, there is no agreement, scientific or political, about what sort of housing is necessary. There are standards about factors such as space or amenities in housing regulations, if these exist and are enforced. Yet, unlike food, for instance, housing is not easily reducible to individual needs. First, it is fixed in space; and second, workers are people and necessarily many have families. Indeed, if none of them have families at all, the labour force is not being reproduced. There are two really fundamental questions about housing that are not factored in to ‘what is strictly necessary’: where housing should be and for whom. Housing standards and provision, and assessments of affordability, tend to work backwards from family units that already exist within existing urban settings – they do not include whether people have the right to live as families, or what the social and welfare costs are of housing expenditure that prevent workers either living within some sort of family unit, should they wish, or indeed having a family at all. The trends towards ultra-low fertility and the sifting of labour in favour of ‘single’ workers in many globalised cities discussed in the previous chapter are indicative of the outcomes that may be occurring. But these ‘costs’ are not just borne by the worker and their household; they are borne by society more widely and, indirectly but eventually, by capitalism itself. The problem is that if housing within reach of someone’s work is unaffordable and housing that is commensurate with home life, having children and socialising them in an adequately secure environment is unaffordable, then the ‘costs’ build up over time for 258

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all concerned. Most people would probably agree that this is a disturbing scenario for big cities. The issue of where urban workers live has long been studied. Obviously discriminatory housing policies, sometimes tied to migration and employment laws and sometimes rooted in racism, have had significant impacts in both GN and GS societies. Aside from these, the underlying factor is land prices, which decrease with distance from city centres. Where this results in suburbs where households are making reasonable choices about trade-offs between ease of access to work and the central city and housing space, as long modelled and discussed by urban planners, economists and geographers, the outcomes are not causes for concern. Nonetheless, glib notions about metro areas’ extents and their vast economic wealth ignore the welfare costs involved for many. When workers are forced to live so far from city workplaces that their welfare and that of their families is seriously compromised by the costs and time involved in transport, this is not ‘reasonable’. In broad terms, at the edges this trades a housing dilemma for a transportand-time dilemma, whereby the time for recuperation at home is too short to maintain physical and mental health or family relationships. Beyond these edges, the inevitable outcome is divided households with the worker ‘living’ in the city part-time. It is also a serious problem for public-sector schemes that all too often are located on land very far from city centres to reduce costs. Building on land with poor access to public transport is also cheaper. This can end up as a double whammy for those housed in such schemes, faced with both long distances and extremely difficult and costly commutes. Accessibility in terms of price and reliability of transport, and not just distance, are important. All this may be compounded by allowing, encouraging or enforcing the segregation, at scale and at considerable distances, usually on urban peripheries, of low-income schemes from other housing types. The emergence of privatised, gated residential communities for the rich furthers segregation. These are recipes for divisive and dangerous cities. It is not that these issues are new – they are well recognised and long discussed and some efforts have been made to address them.23 The importance and societal safety valve of mixed 259

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residential areas have been advocated for generations, even if the notion can be abused by those seeking an excuse to ‘dilute’ established, reasonably well-located low-income neighbourhoods in GN cities via regeneration projects.24 Innovative plans for mixed housing on reasonably priced peri-urban land with excellent and affordable public transport are possible, addressing both the distance and segregation issues, as shown by a recent study on Mumbai. However, these cannot be achieved by market forces: the Mumbai plan relies for its affordable housing components on cross-subsidies from the wealthier groups via differential land pricing.25 The trends now, in both GS and GN cities, are very negative, as urban land values drive the housing affordability crisis and market solutions and profits become more dominant. The centrifugal forces spinning any housing affordable by low-income groups out and away from the major cities are strengthening. As described in Anna Minton’s book on UK cities, Ground Control,26 these forces are often now intertwined with offensive and sinister private-sector efforts to ‘privatise’ particular public spaces and exclude the nonwealthy from everything from roads to shopping centres. One outcome of these centrifugal forces is that housing in large cities is increasingly way beyond the means of so-called ‘key’ workers – those required to maintain the city’s social and physical infrastructure, including teachers, bus drivers, police officers, nurses, electricians and engineers. In Beijing, for instance, in 2016 average rents were 1.2 times average salaries; for nurses, teachers and bus drivers they were 1.1 to 1.5 times their incomes, forcing them out of the city to endure long commutes averaging 104 minutes per round trip.27 In 2016, the London Chamber of Commerce and Industry (LCCI) raised alarm bells when a report it had commissioned found that half of London’s ‘blue light’ emergency workers, including half of all beat police officers, were living outside the city. The reasons included that ‘earnings in the NHS had gone up by 3% or 4% compared with travel costs of 35% and housing costs of a third … [and] subsidised travel for police officers has been discontinued for new recruits after 2014’28 – reflecting the public austerity measures imposed after the financial crash. Thus, the wealthy private sector bemoans the outcomes of cuts in public services on which they rely 260

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while simultaneously profiting from the associated quantitative easing and asset prices, regeneration schemes and gentrification processes driving out affordable housing. The sector also does all it can to evade policies to force elements of truly affordable housing into well-located private-sector housing schemes that have benefited from a regeneration project through which low-income groups have been evicted. Operating from a position of power against cash-strapped but also often compliant local authorities, developers in London, for example, usually succeed in negotiating down the share of ‘affordable’ housing – most of which is still too expensive for the majority of households – to a negligible fraction of the total or even to none at all, with a quid pro quo of building segregated lower-income housing at some distant, cheaper location. Yet in the case of the report discussed above, the ‘solution’ for the LCCI, a bastion of capitalist values, was to ask the then new Labour Mayor of London, Sadiq Khan, to consider becoming the landlord for subsidised emergency service housing within the city, a bitter irony that probably escaped them.

Trends in global income, urban demography and ideologies: a perfect storm for housing affordability? The scale and scope of the housing dilemma in global cities across the world are now manifested in new ways and with new implications. Key questions addressed by this book are how and why this has occurred. The explanation is tied up with the way in which the crisis of housing affordability has increasingly come to be represented in ‘market-speak’. The distressing circumstances in which hundreds of millions of urban dwellers live are presented, wherever possible, in terms of factors that hinder private market provision from ‘working’ as it ‘should’. The real dilemma that low incomes make formal private-sector provision simply unprofitable (and therefore impossible) is thus avoided, despite being central to successful solutions in the past, because this means accepting that, for a significant proportion of city dwellers, housing is a public good that needs to be subsidised by the state. There are many different ways of doing this and policies need to be tailored to individual urban 261

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societies, but the housing dilemma will worsen until that premise is accepted (again). But such acceptance is up against some of the wealthiest and most powerful vested interests in the contemporary world, because urban housing and property development are the source of phenomenal profits and account for astonishing proportions of global GDP. These issues are embedded in long-term global economic shifts. As a proportion of the value of output, workers’ earnings in OECD countries have been on a downward trend for decades. This has fundamental implications for capitalism due to its reliance on everexpanding consumption. From 1990 to 2009, the share fell from 66.1% to 61.7%.29 In the UK it fell from an average of around 59% from the 1950s to the 1970s to 54% in 2011. In the USA it fell from 51.6% in 1953 to 42.9% in 2016.30 Yet these trends are worse still for those in lower-income bands – those caught up in the housing dilemma. Their share has fallen far more sharply. A 2013 study undertaken by researchers from the London School of Economics for the Trades Union Congress in the UK found that the ‘bottom 60 per cent of earners in the UK – and in a number of other rich nations – have … been experiencing a sustained double-edged squeeze, a shrinking share of a diminishing relative wage pool’.31 For the UK this meant that the bottom half of earners shared around only 12% of national income in 2012 compared with 25% three decades earlier.32 The report concludes that ‘this trend has been driven by a mix of factors, but most significantly, the financialisation of the economy (a process encouraged by the de-regulation of finance) and the weakening bargaining power of labour’. However, it makes no mention of the role of housing markets or the impact on housing affordability. For a number of reasons, I argue that these trends should be seen as more than a backdrop to the new phase of the housing dilemma. There is more to their interaction than a simple link between squeezed earnings for the bottom 50% or so and housing unaffordability. Housing is the largest single nondiscretionary budget item for any household. When this was combined with increasing competition for that expenditure because of negative wages-to-output trends, the lending behaviour encouraged by financial deregulation from the 1990s and the centrality 262

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of subprime mortgages in that behaviour, the role of housing in the global financial crash was assured. In the same way as complex environmental processes, in which several feedback loops are manifested, can reach tipping points leading into new (and potentially alarming) scenarios, economic forces can also reach tipping points. It is posited that the current state of the global city housing dilemma is usefully understood as such. When earnings rise more slowly than the cost of housing over the long term, then the housing dilemma becomes increasingly entrenched. If, simultaneously, policies that previously ameliorated the inevitable outcomes of the dilemma – such as dangerously inadequate housing, poverty levels exacerbated by expensive rents, insecure tenure and evictions, and homelessness – are grossly underfunded or simply discarded, then these outcomes reassert themselves. This can also cause a cohort effect whereby younger households are more likely to struggle to get access to reasonably decent and well-located housing than their parents. These have been the conditions of the past few decades, and they have caused a ‘perfect storm’ for housing affordability. The already existing preference of many governments to tackle housing issues by subsidising homeownership for groups in middle-income brackets has also spread more widely, diverting housing budgets from those truly unable to house themselves through formal market supply. Thus, as Steffen Wetzstein has noted in relation to the global urban housing affordability crisis in ‘advanced Western countries’, housing policies have come to be about ‘assembling the evidence to support particular ideologies’.33 He also emphasises that incomes rather than housing supply are the key causes of the affordability crisis and that the fundamental issue is therefore ‘how to help households to earn salaries and wages in line with rising housing expenses’.34 While true enough, this would require a fundamental reallocation of resources and power far beyond anything required for a proper re-engagement with subsidising decent urban housing for those in the housing dilemma. It is thus even more unlikely. There is also a link between the increases in inequality in the world’s wealthier nations over the past few decades, as detailed in Thomas Piketty’s influential book Capital in the Twenty-First 263

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Century,35 and the housing crisis. Piketty emphasises how increases in the concentration of wealth inheritance are contributing to greater inequality. Yet in the second half of the twentieth century, rises in homeownership in the UK, for example, appeared to suggest that the ‘social distribution of housing inheritance … [would] become much more widespread’, albeit that tenants’ children would rarely benefit.36 However, as housing has become increasingly unaffordable, and the rates of homeownership among younger cohorts has fallen, the predictions for the long term are shifting. In 2017, the Institute for Fiscal Studies found that, in the UK, ‘today’s young adults will find it harder to accumulate wealth of their own than previous generations did, due to the sharp fall in homeownership, the dramatic decline of defined benefit pensions in the private sector and the stagnation in household incomes’. In line with Piketty, the report concludes that ‘inherited wealth is likely to play a more important role in determining the lifetime economic resources of younger generations, with important implications for inequality and social mobility’.37 The arguments made in this book have tried to show ways in which the underlying causes of the housing affordability crisis can be seen to operate across the urban world. The global reach of capitalist ideologies and market forces from the end of the twentieth century has been a key factor. Another is the impact of neoliberal ideologies within this expansion, militating against past policies that had ameliorated the worst excesses of the housing dilemma in all societies. The obsession with market ‘solutions’ that do not work for the housing dilemma is an aspect of this. Urban ‘regeneration’ processes to allow property developers to capture the hugely increased land values in central urban areas, all too often at the expense of the housing of low-income residents, are found in all global cities. Reductions in absolute poverty in many countries across the former GS and falling real incomes and reductions in housing subsidies for many in the lower half of the income distribution in the former GN also serve to narrow any gaps that previously existed. Significant changes in urban demography which may be linked to the housing dilemma can be traced in global cities across the world, including unprecedented falls in fertility and shifts in household composition. 264

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Other aspects of ‘demographic sifting’ through the operation of market forces that prefer ‘single’ migrant workers (but always to these workers’ relative detriment), both local and foreign, can also be identified in many such cities. The physical scale of many cities and their surrounding economic ‘footprint’ in terms of commuter belts and other regular patterns of work-related migration and the associated transport implications constitute another set of global characteristics feeding into the housing dilemma. The outstanding housing characteristic that still denotes cities that were previously designated as GS are informal settlements and those that have been subsequently regularised. Yet in some ways this is just because they are so visible (even though it remains true that many foreign visitors can spend weeks or even months in such cities without ‘seeing’ them). On the other hand, their very existence is proof of the premises of the housing dilemma – that the formal capitalist market system cannot provide, because it cannot profit from, urban housing for those on low incomes. Their very informality allows (or allowed) them to be cheap – and the downside of that affordability for the poor is that the housing may be unsafe and unhealthy. The economic factor that remains relevant in predicting the role and nature of informal settlements in large cities is modal income (as opposed to the average). The poorer the population tends to be, the more common are informal settlements. The other factor is whether non-capitalist tenure systems influence land use. However, just as for high-rise luxury apartments, market forces usually shape informal settlements, and almost invariably do so once they are well established – it is just that in the latter they are unregulated (although high-rise residential buildings in the GN are also now becoming victims of deregulation of building standards). When the history of housing for poorer urban groups in ‘Global North’ cities is borne in mind, with mass slums and terrifyingly high death rates as the characteristics of their previously unregulated housing markets, the salience of understanding housing in all cities with reference to general historical and structural economic forces is reinforced. Additionally, the regularisation of vast swathes of informal settlements, alongside massive state intervention in the GN to ensure the availability of affordable ‘decent’ 265

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urban housing for low-income groups, are key legacies of the way in which the public sector has shaped the urban landscape. The subsequent infiltration of more formal market forces into regularised settlements, especially in many middle-income countries, leading to rising prices and a reduction in their affordability for the poor, is simply further proof of the premise that formal housing markets price out those on low incomes. The housing crisis is believed to be at the centre of future struggles to maintain contemporary large cities as places where ordinary people, doing ordinary jobs and earning ordinary incomes can be ‘at home’. Since Jenny Robinson’s seminal book Ordinary Cities,38 in which she argued that urban theory should cast its net wider than the few selected cities of the GN that had largely dominated debates in the twentieth century, the term ‘ordinary’ in relation to urban studies has come to have particular resonance. The use of the term here is therefore deliberate, albeit used in relation to the importance of large cities respecting and caring for all their inhabitants, and not just the high-income groups who work for, or benefit from, the financial, high-tech, legal and property-related sectors that dominate many global cities. Only the public sector, either alone or in tandem with collective and cooperative land acquisition and housing initiatives, can ameliorate the new phase of unaffordable housing forces as it has done in the past.39 Yet beyond the power of market forces and the profit motive there are demographic factors at play. These are usually shaped by the market but sometimes in very complex and indirect ways. National urban systems in some countries are already being reshaped by selective internal migration in ways that seem now to go beyond previously established norms, boosting the human economic potential of big cities but severely reducing that in others, with populations dwindling in some. In our mainly urbanised world of the twenty-first century, in some ways such smaller centres are replacing the classic ‘rural’ areas of earlier eras of urbanisation which fed their youthful, dynamic labour to the towns while their own populations became skewed towards ‘dependants’ (the old and children). However, at least rural areas often provided cheap or free housing – towns do not. The processes of demographic sifting occurring in global cities through the 266

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operation of market forces in employment and housing sectors need to be recognised as having serious implications for human welfare and family life, just as institutionalised controls on labour migration have in states where these are or have been practised. In combination with plummeting fertility in global cities, urban population pyramids are being reconstructed in ways that may have unpredictable outcomes. The priorities of older people are bound to become more important. Many will not be working full-time, if at all, and will have inadequate incomes and pensions in relation to housing costs. How will this work out? We cannot be sure. However, it is reasonable to say that current negative trends in pension incomes in states with mass provision (including latecomers such as Chile and Brazil)40 and in affordable rental accommodation are likely to bolster the already established preference for homeownership. There is a sharp appreciation, even among the young, that incomes dwindle with age but rents do not. In other words, it is realistically believed that most people can face a housing dilemma in big cities should they be lucky enough to grow old. Homeownership is explicitly seen as an insurance strategy against this eventuality. From Haringey in London to the high-density areas of Harare in Zimbabwe, conversations are held about how homeowning, ‘once the mortgage is paid off’, will provide relief from anxiety and allow options otherwise impossible. In today’s social science parlance, homeowning provides resilience. Thus, because state interventions in housing increasingly promote homeownership in response to capitalist property lobbies, there is a feedback loop into people’s housing plans simply because they do not trust their governments to help them with affordable rents and housing. They are probably right. After all, if single parents with children are being forcibly shifted out of the city to reduce the cost of housing support in London, why not pensioners on housing benefit? Where does this leave us? Are we facing a future in which the tier of global cities, competing viciously against one another for globalised finance and investments, are increasingly the homes of only wealthier workers, investors, and those with inherited wealth and their families? Cities in which other workers are housed (but not homed) by renting as single households and lodgers? This is 267

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too neat and negative a conclusion. Cities are messy places, politically, economically and socially. That is part of their strength. The trends described in this book can be slowed and changed by concerted action by urban people. In addition, despite the trends, future housing patterns continue to be mitigated by the built-in legacies of patterns of previous ‘ordinary’ home ownership achieved in more forgiving times and of regulated rentals and what is left of public rental housing. That is why the housing history of each city over the twentieth century, and its legacy, is such a crucial influence on potential outcomes, alongside the determination of the city population to fight for their rights to the city.

268

1 2 3 4 5 6 7 8 9 10 11

Rank

Caracas, Venezuela Kiev, Ukraine Hanoi, Vietnam Mumbai, India Buenos Aires, Argentina Bogota, Colombia Moscow, Russia Rio de Janeiro, Brazil Beijing, China Shanghai, China São Paulo, Brazil

Global city

3,849% 372% 334% 284% 254% 244% 243% 236% 227% 219% 213% $1,193 $1,065 $919 $2,205 $2,195 $1,001 $2,352 $1,513 $2,920 $2,897 $1,402

$2,070 $2,080 $1,684 $4,829 $4,104 $1,527 $4,446 $2,289 $5,719 $5,366 $2,257

Monthly mortgage payment

% of income

Cost

City centre

Housing cost

Table A1  Bloomberg Housing Affordability Index 2018 (US$)

$401 $783 $931 $1,645 $821 $664 $1,968 $1,381 $2,370 $2,777 $1,102

Monthly rent $1,871 $962 $536 $1,644 $3,227 $1,280 $1,996 $1,521 $2,465 $2,421 $1,491

Monthly mortgage payment

$431 $434 $524 $700 $629 $534 $999 $861 $1,125 $1,024 $759

Monthly rent

Outside city centre

Appendix 1: Bloomberg Housing Affordability Index

(continued)

$31 $286 $275 $777 $866 $410 $968 $640 $1,287 $1,324 $660

Take-home pay

12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 28

Rank

Shenzhen, China Almaty, Kazakhstan Lima, Peru Brasilia, Brazil Ho Chi Minh City, Vietnam Quito, Ecuador Jakarta, Indonesia Bangkok, Thailand Hong Kong, China Cairo, Egypt St Petersburg, Russia Manila, Philippines Panama City, Panama Beirut, Lebanon Istanbul, Turkey Delhi, India Belgrade, Serbia Karachi, Pakistan

Global city

Table A1  (continued)

210% 199% 197% 192% 191% 186% 185% 181% 179% 176% 175% 170% 167% 155% 145% 140% 138% 138% $2,613 $963 $1,023 $1,239 $890 $816 $1,099 $1,295 $4,928 $295 $1,222 $944 $1,137 $1,699 $1,020 $908 $578 $420

$5,113 $1,596 $1,483 $2,173 $1,304 $1,118 $1,427 $1,693 $7,195 $436 $1,919 $1,157 $910 $2,420 $1,812 $1,883 $852 $598

Monthly mortgage payment

% of income

Cost

City centre

Housing cost

$1,491 $729 $988 $943 $1,032 $786 $1,666 $1,812 $5,046 $311 $1,068 $1,562 $1,907 $2,421 $915 $634 $625 $467

Monthly rent $2,983 $1,024 $958 $1,243 $621 $838 $656 $831 $4,524 $259 $1,223 $560 $613 $968 $849 $756 $461 $349

Monthly mortgage payment $865 $504 $661 $596 $602 $523 $648 $844 $2,946 $175 $679 $497 $1,118 $985 $505 $360 $373 $267

Monthly rent

Outside city centre

$1,247 $485 $520 $644 $465 $440 $594 $717 $2,750 $168 $700 $555 $682 $1,095 $706 $651 $418 $304

Take-home pay

41 42 43 44 45 46 47 48 49 50 51 52

30 31 32 33 34 35 36 37 38 39 40

London, UK Guangzhou, China Mexico City, Mexico Rome, Italy Singapore, Singapore Chennai, India Budapest, Hungary Milan, Italy Santiago, Chile Tel Aviv, Israel Johannesburg, South Africa Seoul, South Korea Lisbon, Portugal Jerusalem, Israel Vancouver, Canada Vilnius, Lithuania New York, USA Sydney, Australia San Francisco, USA Bucharest, Romania Prague, Czech Republic Paris, France Bangalore, India

100% 98% 95% 91% 90% 86% 86% 85% 85% 84% 84% 84%

135% 130% 130% 118% 113% 108% 106% 105% 103% 103% 100% $2,276 $992 $1,972 $2,102 $692 $3,841 $3,108 $4,516 $539 $934 $2,317 $651

$3,867 $1,308 $967 $1,956 $3,484 $650 $740 $1,871 $773 $3,005 $1,292 $3,654 $1,111 $3,314 $2,322 $831 $4,098 $4,020 $4,198 $602 $1,122 $3,025 $1,158

$5,882 $2,373 $1,409 $2,843 $5,269 $1,323 $941 $2,676 $864 $4,862 $1,706 $2,149 $1,428 $1,999 $2,693 $933 $5,853 $3,610 $6,529 $707 $1,154 $2,569 $591

$4,021 $1,125 $1,030 $2,285 $3,846 $454 $871 $2,304 $780 $2,606 $1,637 $2,088 $547 $1,307 $1,549 $461 $2,138 $2,515 $2,813 $393 $674 $1,969 $500

$2,996 $1,109 $785 $1,289 $2,580 $566 $551 $1,146 $703 $2,825 $799 $1,212 $880 $1,266 $1,845 $542 $3,273 $2,288 $4,522 $452 $787 $1,705 $356

$2,567 $626 $645 $1,406 $2,239 $255 $596 $1,356 $744 $1,728 $1,024

(continued)

$2,285 $1,014 $2,074 $2,311 $772 $4,457 $3,632 $5,313 $635 $1,108 $2,752 $777

$2,875 $1,007 $747 $1,653 $3,095 $600 $696 $1,790 $749 $2,924 $1,293

53 54 55 56 56 58 59 60 61 62 63 64 65 66 67 68 68 70

Rank

Warsaw, Poland Sofia, Bulgaria Reykjavik, Iceland Ankara, Turkey Stockholm, Sweden Tokyo, Japan Riga, Latvia Zagreb, Croatia Ljubljana, Slovenia Doha, Qatar Athens, Greece Kuala Lumpur, Malaysia Bratislava, Slovakia Dublin, Ireland Vienna, Austria Amsterdam, Netherlands Dubai, UAE Madrid, Spain

Global city

Table A1  (continued)

82% 80% 80% 79% 79% 78% 76% 76% 76% 76% 75% 75% 73% 73% 71% 71% 71% 70% $850 $500 $2,287 $495 $2,128 $2,164 $545 $712 $907 $2,264 $600 $754 $771 $1,994 $1,525 $1,862 $2,338 $1,191

$958 $571 $2,529 $815 $2,953 $3,410 $555 $1,017 $1,139 $1,694 $567 $967 $749 $1,907 $2,032 $1,838 $1,640 $1,259

Monthly mortgage payment

% of income

Cost

City centre

Housing cost

$1,033 $604 $2,656 $456 $2,325 $2,468 $772 $725 $1,032 $3,627 $542 $1,047 $1,034 $2,754 $1,790 $2,665 $3,945 $1,702

Monthly rent $631 $396 $1,799 $451 $1,734 $1,552 $355 $616 $762 $1,155 $678 $501 $539 $1,224 $1,085 $1,164 $995 $697

Monthly mortgage payment $778 $428 $2,163 $258 $1,498 $1,225 $499 $491 $695 $2,580 $614 $502 $763 $2,092 $1,192 $1,782 $2,773 $1,106

Monthly rent

Outside city centre

$1,032 $623 $2,872 $629 $2,702 $2,779 $716 $936 $1,200 $2,997 $799 $1,009 $1,058 $2,745 $2,143 $2,641 $3,319 $1,707

Take-home pay

71 72 73 73 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94

Miami, USA Luxembourg, Luxembourg Munich, Germany Oslo, Norway Taipei, Taiwan Boston, USA Tallinn, Estonia Toronto, Canada Dusseldorf, Germany Melbourne, Australia Copenhagen, Denmark Geneva, Switzerland Washington DC, USA Abu Dhabi, UAE Los Angeles, USA Helsinki, Finland Hamburg, Germany Berlin, Germany Brisbane, Australia Brussels, Belgium Frankfurt, Germany Seattle, USA Perth, Australia Zurich, Switzerland

68% 67% 67% 67% 67% 66% 65% 63% 62% 61% 60% 60% 60% 59% 59% 58% 57% 57% 56% 55% 55% 52% 50% 50% $2,159 $2,308 $2,030 $2,172 $1,455 $2,926 $666 $1,693 $1,595 $2,050 $1,889 $3,268 $2,447 $2,276 $2,330 $1,654 $1,404 $1,297 $1,781 $1,278 $1,510 $2,234 $1,591 $3,010

$1,856 $2,419 $2,524 $2,708 $2,482 $3,353 $783 $1,718 $1,845 $2,400 $1,826 $3,632 $2,126 $1,480 $2,010 $1,871 $1,668 $1,390 $2,052 $1,077 $1,760 $2,032 $1,618 $3,634

$3,465 $2,859 $2,218 $2,331 $1,257 $4,206 $835 $2,181 $1,893 $2,341 $2,650 $3,832 $3,886 $3,763 $3,447 $2,153 $1,759 $1,646 $2,169 $1,775 $1,866 $3,529 $2,020 $3,548

$791 $1,907 $1,710 $1,783 $1,339 $1,452 $503 $1,300 $1,137 $1,907 $1,210 $2,675 $998 $1,100 $1,231 $1,107 $953 $951 $1,363 $869 $1,083 $1,026 $1,271 $2,355

$2,525 $2,047 $1,666 $1,864 $743 $2,692 $543 $1,573 $1,506 $1,553 $1,868 $2,932 $2,776 $2,760 $2,632 $1,484 $1,234 $1,202 $1,538 $1,392 $1,329 $2,349 $1,455 $2,502 (continued)

$3,196 $3,422 $3,017 $3,226 $2,175 $4,454 $1,029 $2,690 $2,590 $3,348 $3,131 $5,431 $4,107 $3,864 $3,978 $2,834 $2,464 $2,280 $3,176 $2,320 $2,747 $4,323 $3,170 $6,024

Canberra, Australia Cape Town, South Africa Basel, Switzerland Portland OR, USA Montreal, Canada Ottawa, Canada Chicago, USA Calgary, Canada Philadelphia, USA Houston, USA Riyadh, Saudi Arabia

95 96 97 97 99 100 101 102 103 104 105

49% 49% 48% 48% 47% 46% 45% 41% 40% 32% 31% $1,727 $796 $2,355 $1,781 $980 $1,165 $1,715 $1,158 $1,444 $1,250 $552

$1,829 $750 $2,534 $1,460 $1,007 $1,247 $1,146 $1,046 $1,075 $676 $422

Monthly mortgage payment

% of income

Cost

City centre

Housing cost

Source: Bloomberg analysis of data from Numbeo (www.numbeo.com/cost-of-living/).

Global city

Rank

Table A1  (continued)

$2,155 $1,036 $2,595 $2,880 $1,345 $1,614 $3,158 $1,624 $2,669 $2,422 $907

Monthly rent $1,402 $536 $2,130 $892 $665 $650 $639 $725 $356 $367 $264

Monthly mortgage payment

$1,523 $860 $2,159 $1,892 $904 $1,150 $1,917 $1,236 $1,674 $1,533 $613

Monthly rent

Outside city centre

$3,531 $1,637 $4,887 $3,694 $2,088 $2,526 $3,804 $2,861 $3,607 $3,949 $1,755

Take-home pay

Greece Croatia Spain United Kingdom Bulgaria

2010

2014

99.3 33.7 25.2 23.2 48.0

2010

68.7 – 14.3 44.3 27.1

97.7 – 80.4 83.9 –

Owner with mortgage

Own outright

100.0 91.9 87.2 69.2 100.0

2014

85.0 – 83.1 95.0 –

2010

97.4 93.5 90.4 89.3 87.0

2014

Rent (private)

– – 48.0 84.7 25.3

2010

(continued)

100.0 46.8 46.6 75.2 59.4

2014

Rent (subsidised)

Table A2  Share of households in bottom quintile of income distribution paying more than 40% of disposable income on total housing cost, by tenure (where data available), 2010 and 2014 (or latest year available) (%)

Appendix 2: Total housing cost overburden rate among low-income households in OECD countries

Lithuania Hungary Chile Denmark Belgium Portugal Czech Republic Italy Netherlands Ireland Estonia Malta Finland Switzerland

Table A2  (continued)

2010

2014

30.8 36.2 – 23.0 12.4 18.0 34.2 19.2 17.9 18.7 26.0 2.3 8.7 35.2

2010

43.0 32.3 – 51.1 14.3 6.0 30.3 15.5 16.2 11.7 18.3 11.1 8.1 31.3 – 90.2 – 75.4 84.1 76.4 69.7 80.3 53.0 30.7 98.2 52.0 41.2 44.9

Owner with mortgage

Own outright

79.0 86.7 88.2 54.7 69.1 88.1 80.9 86.6 51.5 54.2 90.2 42.5 42.3 41.6

2014 – 85.1 – 74.5 68.7 45.2 61.5 67.6 58.4 76.1 51.6 64.4 61.9 69.1

2010 86.3 85.0 83.3 81.0 78.5 75.2 73.4 73.1 71.8 70.9 69.2 68.2 64.2 64.1

2014

Rent (private)

– 50.1 – – 31.2 24.4 53.0 36.7 – 14.2 59.7 13.9 49.7 45.7

2010

–

– –

20.0 54.0 3.3 54.2 46.6

26.1 25.1 51.2 46.0

25.4 52.3

2014

Rent (subsidised)

30.5 5.0 19.1 34.3 14.1 6.6 2.4 12.0 21.2 48.7 28.2 41.9 –

33.3 6.0 16.6 36.6 19.2 7.3 10.1 11.5 22.9 52.6 30.6 40.1 –

33.7 61.9 39.2 72.5 65.5 58.4 57.4 42.9 58.9 – 81.4 – 28.6

48.2 64.0 41.7 78.3 80.4 56.9 51.4 28.2 54.6 100.0 78.7 100.0 27.8

56.9 66.9 51.3 69.5 37.5 49.8∗ 43.5 49.0 49.4 – 38.7 41.2 29.6∗

61.8 61.1 60.7 59.8 58.8 56.6∗ 56.6 55.7 49.5 47.0 41.9 38.4 27.4∗ – 41.1 – 51.0 36.9 – 9.1 24.1 39.9 – – 29.0 –

–

– 38.6 45.5 42.8 84.9 6.2 23.7

87.4 50.2 32.1 32.9 51.6

Sources: Compiled from data in the OECD Affordable Housing Database at www.oecd.org/social/affordable-housing-database.htm. 2010 data is from Table HC1.2.A4; 2014 data from Table HC1.2.4; data for Chile and Germany from Table HC.1.2.A2.

Note: ∗Private and subsidised rents.

Sweden France Norway Poland Slovenia New Zealand Luxembourg Iceland Austria Romania Slovak Republic Latvia Germany

Notes

1 The dilemma of affordable housing and big cities 1 Pittini, A., G. Koessl, J. Dijol, E. Lakatos & L. Ghekiere. 2017. The State of Housing in the EU 2017. Brussels: Housing Europe, the European Federation of Public, Cooperative and Social Housing, p. 10. 2 Sassen, S. 2018. Deconstructing labour demand: implications for lowwage employment. In Western Capitalism in Transition: Global Processes, Local Challenges, eds A. Andreotti, D. Benassi & Y. Kazepov. Manchester: Manchester University Press. 3 See Michael Stone’s 2009 paper reviewing the complexities of the definitional issues and the related policy implications: Unaffordable ‘affordable’ housing: challenging the U.S. Department of Housing and Urban Development area median income. Center for Social Policy Publications, Paper 36, p. 36. http://scholarworks.umb.edu/csp_ pubs/36 4 The loss of analytical rigour and policy-relevant insights that stems from labelling all informal housing as ‘slums’ is a major problem for housing studies in the Global South, as eloquently explained in Alan Gilbert’s 2007 paper: The return of the slum: does language matter? International Journal of Urban and Regional Research, 31, 4, 697–713. 5 UN-Habitat’s report The Challenge of Slums is an important example. Another frequently cited and influential book is Mike Davis’s Planet of Slums, although this takes a political economy perspective. UN-Habitat. 2003. The Challenge of Slums: Global Report on Human Settlements 2003. Nairobi: United Nations Human Settlements Programme (UN-Habitat); Davis, M. 2006. Planet of Slums. London & New York: Verso. 6 Robinson, J. 2006. Ordinary Cities: Between Modernity and Development. London: Routledge; Mcfarlane, C. 2010. The comparative city: knowledge, learning, urbanism. International Journal of Urban and Regional Research, 34, 4, 725–42.

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2 Mismatches between incomes and housing costs: a global condition   1 UN-Habitat. 2016. Urbanization and Development: Emerging Futures: World Cities Report 2016. Nairobi: United Nations Human Settlements Programme (UN-Habitat).   2 UN-Habitat defines a slum as ‘a contiguous settlement that lacks one or more of the following five conditions: access to clean water, access to improved sanitation, sufficient living area that is not overcrowded, durable housing and secure tenure’.   3 Ibid., p. 67, emphasis added.   4 See Potts, D. 2010. Harare and Zimbabwe: from formal city to outsourced urban livelihoods. In Circular Migration in Zimbabwe and Contemporary SubSaharan Africa, D. Potts. Oxford: James Currey; Cape Town: University of Cape Town Press.   5 See Potts, D. & C. Mutambirwa. 1991. High-density housing in Harare: commodification and overcrowding, Third World Planning Review, 13, 1–26.   6 Department of Housing, South Africa. 1994. A new housing policy and strategy for South Africa. www.dhs.gov.za/sites/default/files/legislation/ Policies_Housing_White_Paper.pdf   7 Ibid.   8 Tomlinson, M. 1995. From Principle to Practice: Implementers’ Views on the New Housing Subsidy Scheme. Social Policy Series, Research Report No. 44. Johannesburg: Centre for Policy Studies.   9 SAnews.gov.za. 2014. Housing delivery in SA: How have we fared? 11 March. 10 Donnelly, L. 2014. State to tackle housing title deed mess. Mail and Guardian, 1 August. 11 As the incidence of absolute poverty in the Global South has fallen, there has been much debate about the rise of the middle classes but also controversy about the very varied way in which these are being defined. This can affect the design of contemporary housing projects, as discussed in Chapter 8. 12 Satterthwaite, D. & C. Tacoli. 2002. Seeking an understanding of poverty that recognizes rural–urban differences and rural–urban linkages. In Urban Livelihoods: A People-centred Approach to Reducing Poverty, eds C. Rakodi & T. Lloyd-Jones. London: Earthscan. 13 This discussion of poverty measurement in Lusaka draws on work undertaken for the UK Department for International Development reported

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in Porter, G., F. Lyon, D. Potts & T. Bowyer-Bower. 2004. Improving market institutions and urban food supplies for the urban poor: a comparative study of Nigeria and Zambia: scoping phase. London: Department for International Development, R 8330. The poverty basket data are taken from Jesuit Centre for Theological Reflection. 2002. JCTR food basket update: introducing basic needs basket, JCTR Bulletin, 51, First Quarter. See also Chibuye, M. 2011. Interrogating urban poverty lines: the case of Zambia. Human Settlements Working Paper Series: Poverty Reduction in Urban Areas No. 30. London: IIED. 14 Tait, J. 1997. From Self-help Housing to Sustainable Settlement: Capitalist Development and Urban Planning in Lusaka, Zambia. Aldershot: Avebury. 15 Amis, P. 1996. Long-run trends in Nairobi’s informal housing market. Third World Planning Review, 18, 271–86. 16 Gilbert, A. 2014. Renting a home: the need for a policy response. In Affordable Housing in the Urban Global South: Seeking Sustainable Solutions, eds J. Bredenoord, P. van Lindert & P. Smets. New York: Earthscan. 17 Ibid., p. 93. 18 This calculation by the author is based on minimum pay rates for those aged 25 or over in 2017 of £7.50, and an assumption of 40 hours paid work per week, with tax at 20% for annual income over £10,000 and national insurance contributions at 6%. 19 Based on data in the following sources: Shelter. 2011. Shelter Private Rent Watch: Report One: Analysis of Local Rent Levels and Affordability. London: Shelter (UK); Reynolds, L. 2011. Private Rent Watch Report 2: London Rent Watch. London: Shelter (UK); Clarke, E. 2012. A minimum wage pays £10,740 a year. It now costs £10,248 to rent a home and heat it. Labour Left. www.labourleft.co.uk/a-minimum-wage-pays-10740-a-year-it-nowcosts-10248-to-rent-a-home-heat-it/ 20 Gee, A. 2017. Earn minimum wage in the US? You can afford to live in exactly 12 counties. Guardian, 8 June. 21 The issue of who is ‘single’ in this regard is crucial to some outcomes of the housing dilemma, outcomes that have been supported in some countries by deliberate policies. ‘Single’ cannot be understood to mean that a person has no partner or dependent children, which is the sense of the word in common usage. Instead, it means an urban resident renting a room on their own or sharing one with non-related others, even if they have a partner or dependent children. The usual reason is that their immediate family is housed elsewhere because of costs or various constraints, including legislation. 22 Dorling, D. 2014. All That Is Solid: How the Great Housing Disaster Defines Our Times, and What We Can Do About It. London: Allen Lane. 23 See Payne, G. 2014. Policy and politics in urban land market management. In Affordable Housing in the Urban Global South, eds Bredenoord et al. 280

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24 Other examples from the GS on how typical incomes so often render much of the urban population unprofitable for the private sector can be found in Bredenoord et al., eds. Affordable Housing in the Urban Global South. 25 For the UK, see Plummer, D. 2019. Rising levels of poverty in working families. BBC News, 19 June.

3 Afforable urban housing and the role of basic standards   1 Knox, W. n.d. Urban housing in Scotland 1840–1940. In A History of the Scottish People, W. Knox. www.scran.ac.uk/scotland/pdf/SP2_4Housing.pdf   2 United Nations Population Division, World Population Prospects 2019, Infant Mortality Rate.   3 Quigley, J. & S. Raphael. 2004. Is housing unaffordable? Why isn’t it more affordable? Journal of Economic Perspectives, 18, 1, 191–214.   4 Birchenall, J. 2007. Economic development and the escape from high mortality. World Development, 35, 543–68.   5 Tom-all-Alone’s is described in Charles Dickens’ novel Bleak House. He also often described the poor housing conditions of London in the magazine he edited from 1850 to 1859, Household Words.   6 Engels, F. 1892. The Condition of the Working Class in England in 1844. London: Sonnenschein & Co., 1892.   7 Booth, C. 1891. Labour and Life of the People. Volumes 1–9. London: Williams and Northgate; Vaughan, L. 2018. Charles Booth and the mapping of poverty. In Mapping Society: The Spatial Dimensions of Social Cartography, L. Vaughan. London: UCL Press; Hennock, E. 1987. The measurement of urban poverty: from the metropolis to the nation, 1880–1920. Economic History Review, 40, 208–27.   8 Knox, Urban housing in Scotland.   9 Moss, W. 2003. A History of Russia. Volume 1: To 1917. London: Anthem Press, p. 519. 10 Michael, A., L. Baker & M. Westfall. 1991. Overview of the Soviet Housing Sector. Washington DC: Planning and Development Collaborative for USAID Office of Housing and Urban Program. 11 McCourt, F. 1997. Angela’s Ashes. London: Flamingo, p. 114. 12 University of Portsmouth. A Vision of Britain through Time. GB Historical GIS, Edinburgh City through time. Historical Statistics on Life and Death for the District/Unitary Authority. Rate: Infant Mortality Rate. www. visionofbritain.org.uk/unit/10211104/rate/INF_MORT 13 SI (Statutory Instrument) No. 2214, Building and Buildings, England and Wales. The Building Regulations 2010. www.legislation.gov.uk/ uksi/2010/2214/pdfs/uksi_20102214_en.pdf 281

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14 Straw Works. Strawbale Building. www.strawworks.co.uk/ 15 DCLG. 2006. A Decent Home: Definition and Guidance for Implementation: June 2006 Update. London: Department for Communities and Local Government (DCLG). 16 As with many words (e.g. demand, provide), ‘decent’ also has the possibility for misdirecting subsequent analysis or debates because it is not only used in relation to tangible, material conditions such as pay and shelter but is also used with reference to matters of intangible morality. 17 DCLG. 2006. Housing Health and Safety Rating System: Guidance for Landlords and Property Related Professionals. London: Ministry of Housing, Department for Communities and Local Government. 18 Manchester City Council. 2019. Overcrowding: Bedroom Standard Rules: A Summary of our Rehousing Rules. Manchester: Manchester City Council. 19 Wilson, A. 2014. Overcrowded housing (England) SN/SP/1013. House of Commons Library. 20 Potts, D. 2008. The urban informal sector in sub-Saharan Africa: from bad to good (and back again). Development Southern Africa, 25, 151–67. 21 Tibaijuka, A. 2005. Report of the Fact-finding Mission to Zimbabwe to Assess the Scope and Impact of Operation Murambatsvina by the UN Special Envoy on Human Settlements Issues in Zimbabwe. New York: United Nations. www. un.org/News/dh/infocus/zimbabwe/zimbabwe_rpt.pdf 22 Potts, D. 2011. Shanties, slums, breeze blocks and bricks: (mis)understandings about informal housing demolitions in Zimbabwe. City, 15, 6, 709–21. 23 Potts, D. 2008. Displacement and livelihoods: the longer term impacts of Operation Murambatsvina. In Zimbabwe: The Hidden Dimensions of Operation Murambatsvina, Harare, ed. M. Vambe. Harare: Weaver Press; Pretoria: Africa Institute of South Africa. 24 Ward, P. 2010. Colonias and Public Policy in Texas and Mexico: Urbanization by Stealth. Austin: University of Texas Press. 25 Galvin, G. 2018. On the border, out of the shadows. US News, 16 May. 26 Ward, Colonias, p. 83. 27 Ibid., p. 90, emphasis added. 28 Ibid., p. 73. 29 Ibid., p. 90. 30 Ibid., p. 93. 31 Ibid., p. 65. Government housing programmes were very limited in Mexico until the 1970s and even then only met about one-fifth of effective (i.e. monetary) demand. As Ward notes (p. 66), ‘[l]ow wage rates meant that private housing production was unprofitable’ and prevented any significant mortgage market. 32 Ibid., p. 119. 33 Ibid., p. 139.

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34 Swanson, M. 2009. The sanitation syndrome: bubonic plague and urban native policy in the Cape Colony, 1900–1909. Journal of African History, 18, 3, 387–410. See also the discussion in Chapter 4. 35 Ward, Colonias, p. 98. 36 Ibid., p. 137. 37 Ibid., p. 105. 38 Ibid., p. 107. 39 Tipple, G. 2000. Extending Themselves: User Initiated Transformations of Government-built Housing in Developing Countries. Liverpool: Liverpool University Press. 40 UN-Habitat & Good Earth Trust. 2009. Interlocking Stabilised Soil Blocks: Appropriate Earth Technologies in Uganda. Nairobi: UN-Habitat. 41 Laville, S. 2018. Bamboo house: easy to build, sustainable Cubo wins top prize. Guardian, 22 November.

4 Private-sector urban housing provision: formal and informal   1 Of particular significance is the long-standing work by Alan Gilbert, who, on the basis of decades of work on housing in Latin America, urged other housing scholars to differentiate between subsectors of informal housing because there is so much variation in its quality both within and between cities across the world, and because labelling too many settlements as ‘slums’ hinders appropriate policy variation and can encourage unprogressive urban authorities to embark on evictions to free up valuable land under the banner of ‘slum clearances’. See Gilbert, The return of the slum.   2 There are many studies of colonially segregated cities. A recent book that draws out the connections over time for cities throughout urban history and the world, including the impact of European colonialism in, for example, Calcutta, but also the deliberate creation of segregation in American cities, is Nightingale, C. 2012. Segregation: A Global History of Divided Cities. Chicago: University of Chicago Press.   3 Minton, A. 2012. Ground Control. London: Penguin.   4 Swanson, The sanitation syndrome.   5 Knox, Urban housing in Scotland.   6 Potts, Displacement and livelihoods.   7 Knox, Urban housing in Scotland, pp. 4–5.   8 Simon, cited in Yelling, J. A. 1986. Slums and Slum Clearance in Victorian London. London: Allen & Unwin, p. 12.   9 Hudson, C. 2008. It was the worst slum in Victorian Britain. Mail Online, 10 July, citing Wise, S. 2008. The Blackest Streets. London: Bodley Head.

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10 Ibid. 11 Knox, Urban housing in Scotland, p. 5. 12 Minton, Ground Control. 13 DCLG. 2010. English Housing Survey: Housing Stock Report 2008. London: Department for Communities and Local Government (DCLG). www.gov.uk/government/uploads/system/uploads/attachment_data/ file/6703/1750754.pdf 14 O’Connor, S. 2017. Real wages fall despite lowest jobless rate since 1975. Financial Times, 18 May. 15 Nightingale, Segregation. 16 See Minton, Ground Control; Lemanski, C., M. Durington & K. Landman. 2008. Divergent and similar experiences of ‘gating’ in South Africa: Johannesburg, Durban and Cape Town. Urban Forum, 19, 2, 133–58; Roy, S. 2012. Gated communities in India: an overview. In 2nd International Engineering Symposium: IES 2012, 5–7 March 2012, Kumamoto University, Japan; Pow, C. P. 2009. Gated Communities in China. London: Routledge. 17 Watson, V. 2014. African urban fantasies: dreams or nightmares? Environment and Urbanization, 26, 1, 215–31. 18 Ramirez, K. 2017. Value of U.S. housing market climbs to record $31.8 trillion. Housing Wire, 29 December. 19 Ward, Colonias, p. 87. 20 von Hoffman, A. 2012. History lessons for today’s housing policy: the political processes of making low-income housing policy. Housing Policy Debate, 22, 3, 321–76. 21 Davis, Planet of Slums, back cover material. 22 This is a complex issue. In such evaluations it is important to focus on net rather than gross migration, for example. Not all economic migration is successful but if a move does not work out migrants may move on or return to their place of origin, if that remains a possibility. Although there is a generally observable and verifiable positive impact of rural–urban migration for migrants (see, for example, de Haan, A. 2000. Livelihoods and poverty: the role of migration – a critical review of the migration literature. Journal of Development Studies, 36, 1–47), this does not mean that all migrants increase their welfare by moving. 23 Konadu-Agyemang, K. 1991. Reflections on the absence of squatter settlements in West African cities: the case of Kumasi, Ghana. Urban Studies, 28, 1, 139–51. 24 The outcomes of such processes in Ghana are very varied, for example. For Accra, see Gough, K. & P. Yankson. 2001. The role of civil society in urban management in Accra, Ghana. In Associational Life in African Cities: Popular Responses to the Urban Crisis, eds A. Tostensen, I. Tvedten & M. Vaa. Uppsala: Nordiska Afrikainstitutet; for Kumasi see Simon, D., D. Mcgregor & K. Nsiah-Gyabaah. 2004. The changing urban–rural 284

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interface of African cities: definitional issues and an application to Kumasi, Ghana. Environment and Urbanization, 16, 2, 235–48. 25 For India, see Cowan, T. 2017. Subaltern counter-urbanism: dynamics of urban and industrial change in Gurgaon, India’s millennium city. PhD thesis, Geography Department, Kings College London. The occupation of smallholder ejidos land in Mexico was made possible by land reforms resulting from the Mexican Revolution. Its tenure derived some of its features from indigenous Aztec and medieval Spanish systems and originally allowed the rights to use and inherit the land; sales were not allowed until the 1990s. See Blumberg, S. & E. Lahera. 2007. Modern Land Reform in Mexico’s Ejidos: Updating the 1992 Agrarian Law. Princeton: Woodrow Wilson School of Public and International Affairs, Princeton University. 26 This is the norm in most housing analyses, although there is strong evidence to the contrary in relation to the outcomes for local residents (if not for capitalist property developers). For a useful review, see Payne, G., A. Durand-Lesserve & C. Rakodi. 2009. The limits of land titling and home ownership. Environment and Urbanization, 21, 2, 443–62. 27 Ibid. 28 Andersen, J., P. Jenkins & M. Nielsen. 2015. Who plans the African city? A case study of Maputo: part 1 – the structural context. International Development Planning Review, 37, 3, 329–50. 29 Chimhowu, A. & P. Woodhouse. 2006. Customary vs private property rights? Dynamics and trajectories of vernacular land markets in subSaharan Africa. Journal of Agrarian Change, 6, 3, 346–71. 30 Smith, S. 2015. The relationship between housing tenure and service delivery within the low-income settlements of Kenya’s secondary cities: everyday life in relation to the rental economy. PhD thesis, Department of Geography, Royal Holloway, University of London. 31 Konadu-Agyemang, Reflections on the absence of squatter settlements, p. 141. 32 Davis, Planet of Slums, p. 41. 33 UN-Habitat. 2010. The State of African Cities 2010: Governance, Inequality and Urban Land Markets. Nairobi: UN-Habitat. 34 Ibid., p. 42.

5 Squaring the circle: social housing programmes and affordable rents   1 In 2015, Savills, the real-estate adviser, calculated that world real estate was valued at $217 trillion, equivalent to 2.7 times global GDP, and accounted for 60% of all ‘mainstream’ assets. This included commercial property and developed forestry and agricultural land, but residential property, valued 285

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at $162 trillion, made up the largest proportion at 75%. See Savills. 2016. World real estate accounts for 60% of all mainstream assets. Savills News, 25 January.   2 Plummer, R. 2019. Does help-to-buy prop up housebuilders? BBC News, 27 February.   3 Steffel, R. V. 1976. The Boundary Street Estate: an example of urban redevelopment by the London County Council, 1889–1914. Town Planning Review, 47, 2, 161–73.   4 University of the West of England. 2008. The history of council housing. http://fet.uwe.ac.uk/conweb/house_ages/council_housing/print.htm   5 In 2014, one factor included in calculations for council rents was average manual earnings for the county in which the property was located divided by national average manual earnings. This meant that geographical variations in wages paid for low-income work were also accounted for. Cornwall’s manual wages were estimated at about 40% lower per week than those for London, for example. See DCLG. 2014. Guidance on Rents for Social Housing. London: Department for Communities and Local Government (DCLG).   6 Harris, J. 2016. The end of council housing. Guardian, 4 January.   7 Ward, Colonias, p. 87.   8 Stoloff, J. n.d. A Brief History of Public Housing. Washington DC: US Department of Housing and Urban Development, Office of Policy Development and Research. http://reengageinc.org/research/brief_history public_housing.pdf   9 Ibid. 10 Ibid. 11 Buckley, R. & E. Gurenko. 1997. Housing and income distribution in Russia: Zhivago’s legacy. World Bank Research Observer, 12, 1, 19–32. 12 OECD. Affordable housing database. www.oecd.org/social/affordablehousing-database.htm 13 Tait, From Self-help Housing to Sustainable Settlement. 14 See, for example, Gonick, S. 2011. Disciplining the metropolis: Grand Paris, immigration, and the banlieue. Berkeley Planning Journal, 24, 1, 26–45; Minton, Ground Control. 15 Marcuse, P. 2002. The shifting meaning of the black ghetto in the United States. In Of States and Cities: The Partitioning of Urban Space, eds P. Marcuse & R. van Kempen. Oxford: Oxford University Press. 16 Maylam, P. 2001. South Africa’s Racial Past: The History and Historiography of Racism, Segregation, and Apartheid. Aldershot: Ashgate. 17 Surplus People Project. 1983. Forced Removals in South Africa: The Surplus People Project Report. Cape Town: Surplus People Project; Murray, C. 1983. Struggle from the margins: rural slums in the Orange Free State. In Struggle for the City: Migrant Labor, Capital and the State in Urban Africa, ed. F. Cooper. Beverly Hills: Sage. 286

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18 Beall, J., O. Crankshaw & S. Parnell. 2006. A matter of timing: migration and housing access in metropolitan Johannesburg. In African Urban Economies: Viability, Vitality or Vitiation?, eds D. Bryceson & D. Potts. Basingstoke: Palgrave Macmillan. 19 Ramphele, M. 1993. A Bed Called Home: Life in the Migrant Labour Hostels of Cape Town. Cape Town: David Philip. 20 Paice, L. 2008. Overspill policy and the Glasgow slum clearance project in the twentieth century: from one nightmare to another? Reinvention, 1, 1. 21 Smith, S. 2015. The relationship between housing tenure and service delivery within the low-income settlements of Kenya’s secondary cities: everyday life in relation to the rental economy. PhD thesis, Department of Geography, Royal Holloway, University of London. 22 Potts, D. & C. Mutambirwa. 1991. High-density housing in Harare: commodification and overcrowding. Third World Planning Review, 13, 1, 1–26. 23 See Davis, Planet of Slums; Amis, Long-run trends in Nairobi’s informal housing market. 24 See, for example, Amis, P. 1984. Squatters or tenants: the commercialization of unauthorized housing in Nairobi. World Development, 12, 1, 87–96; Centre on Housing Rights and Evictions (COHRE). 2006. Listening to the Poor? Housing Rights in Nairobi, Kenya. COHRE Fact-finding Mission to Nairobi, Kenya. Final Report. Geneva: USP. 25 For London, see Watt, P. 2018. ‘This pain of moving, moving, moving:’ evictions, displacement and logics of expulsion in London. L’Année Sociologique, 68, 1, 67–100. 26 McCourt, Angela’s Ashes. 27 Desmond, M. 2017. Evicted: Poverty and Profit in the American City. New York: Penguin Random House. 28 Wall Street Journal. 2016. Who read what in 2016. Wall Street Journal, 7 December. 29 Lundberg, I. & L. Donnelly. 2019. A research note on the prevalence of housing eviction among children born in U.S. cities. Demography, 56, 1, 391–404. 30 Amis, Squatters or tenants, p. 94. 31 See, for example, Gilbert, Renting a home. 32 Davis, Planet of Slums, pp. 43–5. 33 Hubert, F. 2003. Rent control: academic analysis and public sentiment. Swedish Economic Policy Review, 10, 61–81, pp. 64–5. 34 Davies, B., C. Snelling, E. Turner & S. Marquardt. 2017. Lessons from Germany: Tenant Power in the Rental Market. London: Institute for Public Policy Research. 35 Gilbert, A. 2016. Rental housing: the international experience. Habitat International, 54, 173–81. 36 Hubert, Rent control, p. 65. 287

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37 Alrich, A. 2003. Germans displaced from the East: crossing actual and imagined central European borders, 1944–1955. PhD thesis, Department of History, Ohio State University. 38 Hubert, Rent control, p. 65. 39 Davies et al., Lessons from Germany. 40 O’Sullivan, F. 2015. In Germany, renters’ rights trump guest bathrooms. CityLab, 5 January. 41 Niemitz, K. 2016. How Germany Made Rent Control ‘Work’. London: Institute of Economic Affairs. 42 Germany’s relative prudence in lending for its own housing market protected it from some of the excesses of the 2008 financial crash, as emphasised in Voigtländer, M. 2012. The Stability of the German Housing Market. MPRA. Paper 43315. Munich: Institute der deutschen Wirtschaft Koln, Hochschule Bonn-Rhein-Sieg; see also Expatica. 2017. How to get a mortgage in Germany. www.expatica.com/de/housing/How-to-get-amortgage-in-Germany_740222.html 43 Bourassa, S. & M. Hoesli. 2008. Why do the Swiss rent? Journal of Real Estate Finance and Economics 40, 3, 286–309, p. 306. This article also explains that the Swiss impose limits on mortgage payments of a maximum of 33% of income (p. 294). 44 Ibid., p. 287. 45 Ibid., p. 288. 46 Ibid., p. 290. 47 Lammy, D. 2018. We’re in a new era of slum landlords and tenant squalor. Guardian, 25 October. 48 Jeraj, S. 2013. Illegal evictions: divide and rule. Bright Green, 28 May. 49 BBC News. 2015. Why is the UK’s housing benefit bill so high? BBC News, 21 September. 50 Ibid. 51 Plummer, Rising levels of poverty in working families. 52 Dickens, C. Our Mutual Friend (Kindle edition); see also Nelson, H. S. 1965. Dickens’s Our Mutual Friend and Henry Mayhew’s London Labour and the London Poor. Nineteenth-Century Fiction, 20, 3, 207–22. 53 HM Treasury. 2015. Chancellor George Osborne’s Summer Budget 2015 speech, 8 July. www.gov.uk/government/speeches/chancellor-georgeosbornes-summer-budget-2015-speech#content 54 Gee, A. 2017. Earn minimum wage in the US? You can afford to live in exactly 12 counties. Guardian, 8 June. 55 BBC News. 2019. Why some Japanese pensioners want to go to jail. BBC News, 31 January; Newman, M. 2016. Crime in Japan – Series 1: Economics of elderly crime. Contrarian Marketplace, 22 February. https:// newmanlive.files.wordpress.com/2017/11/cm-crime-in-japan-geriatricjailbirds.pdf 288

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6 Squaring the circle: affordable urban homeownership   1 The ‘disciplining’ nature of debt and capitalism’s vested interest in incorporating as many people across the world into indebtedness has long been recognised. For the post-financial crash situation, see Dukelow, F. & P. Kennett. 2018. Discipline, debt and coercive commodification: postcrisis neoliberalism and the welfare state in Ireland, the UK and the USA. Critical Social Policy, 38, 3, 482–504.   2 The author’s research among low-income migrants in Harare, Zimbabwe found this to be true of nearly all respondents. Research among women across urban southern Africa has found the same. See, for example, Larsson, A., M. Mapetla & A. Schlyter, eds. 1998. Changing Gender Relations in Southern Africa: Issues of Urban Life. Lesotho: Institute of Southern African Studies, National University of Lesotho. For Europe, see Elsinga, M. & J. Hoekstra. 2005. Homeownership and housing satisfaction. Journal of Housing and the Built Environment, 20, 4, 401–24.   3 de Soto, H. 2000. The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else. New York: Basic Books.   4 Stoloff, A Brief History of Public Housing.   5 Thompson, D. 2017. The shame of the mortgage-interest deduction. The Atlantic, 14 May. This regressive feature of tax relief for mortgages is usual where it is practised, and largely inevitable, given that low-income households are generally unable to buy houses at market rates and, by value, most mortgage lending goes to the richest households who can borrow for expensive houses.   6 See, for the UK, Hamnett, C. 2009. The Madness of Mortgage Lenders: Housing Finance and the Financial Crisis. London: Institute for Public Policy Research. www.ippr.org/files/images/media/files/publication/2011/05/ madness_of_mortgage_lenders_1692.pdf   7 Ito, M. & F. Matsumoto. 2015. Lee Yuan Kew’s growth strategy not for everybody. Nikkei Asian Review, 24 March.   8 The Economist. 2015. Why Singapore became an economic success. The Economist, 26 March.   9 Scott, A. 2017. Here’s what it would really mean if Britain was like Singapore. New Statesman, 6 February. 10 Crabtree, J. 2017. Singapore is not quite what Brexiters think it is. Financial Times, 4 April. 11 Housing and Development Board [Singapore]. 2015. Public Housing: A Singapore Icon. Singapore: Housing and Development Board (HDB). 12 Ibid. 13 Ibid.; Lim, P. 2012. A brief introduction to Singapore’s rental flats. Icompare Loan, Property Market News, 3 December. 289

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14 Singapore Government. Land Acquisition Act is enforced: 17th Jun 1967. History SG Online Resource Guide. http://eresources.nlb.gov.sg/history/ events/1f669eff-bc82-49d1-a27c-2624e4cab8c6 15 Cited in Scott, Here’s what it would really mean if Britain was like Singapore. 16 Bayat, A. 2000. From ‘dangerous classes’ to ‘quiet rebels’: politics of the urban subaltern in the Global South. International Sociology, 15, 3, 533–57. 17 Ward, Colonias. 18 Satterthwaite, D. & D. Mitlin. 2013. A Future that Low-income Urban Dwellers Want, and Can Help Secure. London: IIED. 19 See, for example, for South Africa, Bond, P. 1995. Urban social movements, the housing question and development discourse in South Africa. In Debating Development Discourse, eds D. B. Moore & G. J. Schmitz. London: Palgrave Macmillan. 20 Mitlin, D. 2014. Politics, informality and clientelism: exploring a pro-poor urban politics. ESID Working Paper No. 34. Manchester: Effective States and Inclusive Development (ESID) Research Centre. 21 Gilbert, A. & J. Gugler, eds. 1982. Cities Poverty and Development: Urbanization in the Third World. New York & Oxford: Oxford University Press. 22 Davis, Planet of Slums, p. 38. 23 Roy, A. 2005. Urban informality: towards an epistemology of planning, Journal of the American Planning Association, 7, 2, 147–58, p. 149. 24 Kumar, A. 2005. Mumbai’s expendable poor. Economic and Political Weekly [India] 40, 6, 5 February. 25 Bharucha, N. 2015. Nine landowners control a fifth of Mumbai. Times of India, 10 January. 26 UN-Habitat. 2012. State of Latin American and Caribbean Cities. Nairobi: UN-Habitat, p. 66, Figure 3.4. 27 Ibid., p. xii. 28 Ibid. 29 World Bank. World Development Indicators online dataset: per cent in slums by country. 30 Ascensão, E. 2010. The ‘postcolonial slum’: informal settlement as a ‘building event’ in Lisbon, Portugal. Working paper presented at The Urban Salon, 18 January, p. 6. http://kcl.academia.edu/EduardoAscens%C3%A3o 31 Paskins, J. 2016. Paris under Construction: Building Sites and Urban Transformation in the 1960s. New York: Routledge. 32 Ward, Colonias. 33 Black African landowners also rented farmland for housing as far back as the nineteenth century, when private freehold landholding still existed for a few. However, these areas were whittled away by the 1913 and 1936 Land Acts in South Africa, which removed rights to virtually all such property for 290

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black Africans. See James, D. 2007. Gaining Ground: ‘Rights’ and ‘Property’ in South African Land Reform. Abingdon & New York: Routledge, citing P. La Hausse. 34 Kiewit, L. 2014. Shack farming invasion booms in W. Cape. eNCA, 12 January. 35 Ward, P. & N. Durst. 2014. Measuring self-help home improvements in Texas colonias: a ten-year snapshot, Urban Studies, 51, 10, 2143–59. 36 See Ward, Colonias. This ‘recipe’ of how to create a colonia in Texas was created, partly tongue in cheek, by a local developer, Cecil Macdonald, and is reproduced in Ward’s book. 37 Ibid., p. 69. 38 Ibid., p. 113. 39 Ibid., p. 114. 40 Sacchetti, M. 2018. In South Texas, tens of thousands live in border enclaves without water, power or certainty of their future. Washington Post, 30 January. 41 Zavaleta, A. & M. Kaplan. 2018. Immigrant caging on the Texas–Mexico border. Rio Grande Guardian, 17 October. 42 Ward, Colonias. 43 For a review of approaches to housing policy involving self-help, see Bredenoord, J. & P. van Lindert. 2014. Backing the self-builders: assisted self-help housing as sustainable housing provision strategy. In Affordable Housing in the Urban Global South, eds Bredenoord et al. 44 Royston, L. 2002. Security of urban tenure in South Africa: policy and practice. In Holding their Ground: Secure Land Tenure for the Urban Poor in Developing Countries, A. Durand-Lasserve & L. Royston. London: Earthscan. 45 See ‘Setting the context: South Africa’, paper presented at ‘More Than Shelter: Housing as an Instrument of Economic and Social Development’, Harvard Joint Center for Housing Studies, International Housing Conference, held at Bellagio Study and Conference Center, Bellagio (Como), Italy, 9–14 May 2005; Knight, R. 2004. A decade of democracy: housing, services and land in South Africa. South Africa Delegation Briefing Paper. Shared Interest. http://richardknight.homestead.com/files/sihousing2004.htm 46 Potts, D. 1999. Housing policies in Southern Africa. In Urban Issues in Southern Africa, eds S. Jaglin, P. Gervais-Lambony & A. Mabin. Cape Town: David Philip; Paris: Karthala. 47 Logan, J., Y. Fang & Z. Zhang. 2010. The winners in China’s urban housing reform. Housing Studies, 25, 1, 101–17. 48 OECD. 2016. HM1.3 housing tenures. OECD Affordable Housing Database – http://oe.cd/ahd OECD; Social Policy Division, Directorate of Employment, Labour and Social Affairs. www.oecd.org/els/family/HM13-Housing-tenures.pdf 291

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49 Wang, Y. P. n.d. China’s urban housing revolution: from socialist work units to gated communities and migrant enclaves. Presentation. Glasgow: Urban Studies, University of Glasgow. 50 Li, V. 2016. Housing policies in Hong Kong, China and the People’s Republic of China. ADBI Working Paper Series No. 566. Tokyo: Asian Development Bank Institute (ADBI). www.iberchina.org/files/2016/ housing_china_hk_adb.pdf; Yu, Z. 2006. Heterogeneity and dynamics in China’s emerging urban housing market: two sides of a success story from the late 1990s, Habitat International, 30, 277–304. 51 Westendorff, D. 2007. Security of housing tenure in the People’s Republic of China: background, trends and issues. Case study prepared for UN-Habitat. 2007. Enhancing Urban Safety and Security: Global Report on Human Settlements 2007. London: Earthscan. 52 Wang, China’s urban housing revolution. 53 Li, Housing policies. 54 Ibid. 55 Ibid. 56 Westendorff, Security of housing tenure. 57 Yu, Heterogeneity and dynamics. 58 Ibid. 59 Li, Housing policies.

7 Global finance, big cities and unaffordable housing   1 Jones, C. & A. Murie. 2008. The Right to Buy: Analysis and Evaluation of a Housing Policy. London: John Wiley. Sales had been allowed before in specific circumstances but this policy rewrote the rules; see Beckett, A. 2017. Right-to-buy: the housing crisis that Thatcher built. Guardian, 26 August.   2 Stoloff, A Brief History of Public Housing.   3 Ward, Colonias, p. 87.   4 Milligan, B. 2013. Right-to-buy: Margaret Thatcher’s controversial gift. BBC News, 10 April.   5 For example, Simon, D., W. van Spengen, C. Dixon & A. Närman, eds. 1995. Structurally Adjusted Africa: Poverty, Debt and Basic Needs. London & Boulder: Pluto Press.   6 Potts, D. 1985. Capital relocation in Africa: the case of Lilongwe in Malawi. Geographical Journal, 151, 2, 182–96.   7 TCPD. 1986. Lilongwe Outline Zoning Scheme. Lilongwe: Town and Country Planning Department (TCPD).   8 Kaluwa, B. 1994. The delivery of urban services in Malawi: the case of housing. In Planning Urban Economies in Southern and Eastern Africa, eds K. Wekwete & C. Rambanapasi. Aldershot: Avebury. 292

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  9 The early success and potential of Malawi’s THAs and their decline from underfunding was described in Pennant, T. 1990. The growth of smallscale renting in low-income urban housing in Malawi. In Housing Africa’s Urban Poor, eds P. Amis & P. Lloyd. Manchester: Manchester University Press, p. 197. 10 Chilowa, W. & G. Roe. 1987. The Plight of the Urban Poor: Results from a Baseline Survey. Zomba: Centre for Social Research. 11 Kaluwa, The delivery of urban services in Malawi, p. 267. 12 Ibid., p. 265. 13 Mullins, D. 2010. Housing associations. Working Paper No. 16. Birmingham: University of Birmingham, Third Sector Research Centre. 14 Jones & Murie, The Right to Buy. 15 Ibid. 16 Collinson, P. 2013. Meet the new class of landlords profiting from Generation Rent. Guardian, 28 June. 17 Copley, T. 2014. From Right to Buy to Buy to Let. London: Greater London Authority & London Assembly Labour. 18 Ibid. 19 Poverty Reduction and Economic Management Unit (AFTP2), Water and Urban Development Unit (AFTU1), Africa Region. 2009. Ethiopia: The employment creation effects of the Addis Ababa integrated housing program. Report No. 47648-ET. Washington DC: World Bank 20 Ibid., p. 5. 21 The Economist. 2017. Not for the poor anymore: Ethiopia is struggling to make housing affordable. The Economist, 31 August. 22 Ibid. 23 Kajilwa, G. 2017. Why Kibera residents opted to give out new houses. Standard [Kenya], 24 August. 24 Croese, S., L. Cirolia & N. Graham. 2016. Towards Habitat III: confronting the disjuncture between global policy and local practice on Africa’s ‘challenge of slums’. Habitat International, 53, 237–42. 25 See Cain, A. 2017. Alternatives to African commodity-backed urbanization: the case of China in Angola. Oxford Review of Economic Policy, 33, 3, 478–95. 26 The Economist, Not for the poor anymore. 27 Schmidt, M. 2017. Ghost cities: Africa’s moving in. Africa in Fact, 19 April. 28 Croese, S. & M. Pitcher. 2019. Ordering power? The politics of stateled housing delivery under authoritarianism: the case of Luanda, Angola. Urban Studies, 56, 2, 401–18. 29 Cain, Alternatives to African commodity-backed urbanization, p. 487. 30 Harvey, D. 2004. Paris, Capital of Modernity. New York: Routledge. 31 Harvey, D. 2010. The right to the city: from capital surplus to accumulation by dispossession. In Accumulation by Dispossession: Transformative 293

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Cities in the New Global Order, ed. S. Banerjee-Guha. New Delhi: Sage Publications India. 32 Centre on Housing Rights and Evictions. 2005. In the footsteps of India and China? Evictions Monitor, 1, 3, 12–14. 33 Ibid., p. 13. 34 Kumar, Mumbai’s expendable poor. 35 Ibid. 36 Chatterji, R. 2005. Plans, habitation and slum redevelopment: the production of community in Dharavi, Mumbai. Contributions to Indian Sociology, 39, 2, 197–218, p. 199. 37 Tutton, M. 2009. Real life ‘Slumdog’ slum to be demolished. CNN, 23 February. 38 Shaikh, A. 2016 Mumbai: largest slum in Asia – Dharavi gets ready for a makeover. DNA India, 11 January; Kamath, N. 2017. Fresh bid to redevelop Asia’s biggest slum Dharavi in Mumbai. Hindustan Times, 27 June. 39 Kitson, R. 2013. Heygate Estate’s last resident is forcibly evicted by police. Evening Standard [London], 8 November. 40 Sheppard, O. 2017. Embattled Aylesbury leaseholders vow to win their eviction fight against the council. Southwark News, 11 May; Lees, L. 2014. The death of sustainable communities in London. In Sustainable London? The Future of a Global City, eds R. Imrie & L. Lees. Bristol: Policy Press; Turner, G. 2018. Revealed: London council took on financial risk of estate development. Guardian, 12 September. 41 Williams, A. 2017. Mistrust haunts £4bn London housing project. Financial Times, 6 December. 42 Lees, L., T. Slater & E. Wyly. 2013. Gentrification. New York: Routledge; Bridge, G. & T. Butler, eds. 2011. Mixed Communities: Gentrification by Stealth? Bristol: Policy Press; Wyly, E. & D. Hammel. 2004. Gentrification, segregation, and discrimination in the American urban system. Environment and Planning A, 36, 7, 1215–41. 43 For example, see Lees, L,. H. Shin & E. López-Morales, eds. 2015. Global Gentrifications: Uneven Development and Displacement. Bristol: Policy Press. 44 Cummings, J. 2015. Confronting favela chic: the gentrification of informal settlements in Rio de Janeiro, Brazil. In Global Gentrifications, eds Lees et al. 45 Erman, T. 2011. Understanding the experiences of the politics of urbanization in two gecekondu (squatter) neighborhoods under two urban regimes: ethnography in the urban periphery of Ankara, Turkey. Urban Anthropology, 40, 1/2, 67–108. 46 Richard Nixon, Special Message to the Congress Proposing Legislation and Outlining Administration Actions to Deal with Federal Housing Policy, 19 September 1973, cited in von Hoffman, History lessons for today’s housing policy, p. 48. 294

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47 Blanchard, O. & L. Summers. 2017. Rethinking Stabilization Policy: Back to the Future. Washington DC: Peterson Institute for International Economics. 48 See Versluysen, E. 1988. Financial deregulation and the globalization of capital markets (English). Policy, Planning and Research Department Working Paper No. WPS 40. Washington DC: World Bank. 49 Bank of England. 1991. Housing finance: an international perspective. Bank of England Quarterly Bulletin, February, 56–66. 50 Lewis, M. 2011. The Big Short: Inside the Doomsday Machine. London: Penguin. 51 Blinder, A. S. 2013. After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead. New York: Penguin. 52 According to the account in Lewis’s The Big Short, there was strong demand for these packaged investments from German investors, for example, and the marketing was also globalised: ‘along with Goldman, Deutsche Bank was the leading market maker in abstruse mortgage derivatives’ (p. 67). 53 Hamnett, The Madness of Mortgage Lenders. 54 Ibid. 55 The Week. 2017. Ten years on: the financial crisis in numbers. The Week, 7 August. 56 Before being renationalised, the prospectuses of Fannie Mae stated: ‘The certificates and payments of principal and interest on the certificates are not guaranteed by the United States, and do not constitute a debt or obligation of the United States or any of its agencies or instrumentalities other than Fannie Mae.’ The determination to maintain this fiction even after the forced nationalisation remained: similar statements still appear on Fannie Mae documents today. 57 Some argued that banks had been ‘forced’ to lend to people too poor to repay by the USA government’s Community Reinvestment Act (CRA), which tried to prevent discriminatory lending practices that disadvantaged African Americans and other minorities by CRA-regulated institutions. However, that Act stated that loans had to be consistent with safe and sound operations, the US Congress’s Financial Crisis Inquiry Commission found that it had not played a significant role in the crash, and most subprime loans were not made by CRA-regulated institutions. 58 Local Government Association [UK]. 2017. Council funding to be further cut in half over next two years – LGA warn. Press Release, 17 December. 59 The Week, Ten years on. 60 The Week. 2017. UK workers facing worst wage squeeze since Napoleonic wars. The Week, 10 March. 61 Harvey, D. 2001. Globalization and the ‘spatial fix’. Geographische Revue, 2, 23–30. 295

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62 For example, Youel, S. 2019. The rise in vacant properties exposes the housing shortage myth. City Metric, 14 March. 63 Somerset Webb, M. 2017. Save more – it’s the only way to escape trouble. Financial Times, 21 July. 64 Somerset Webb, M. 2019. ECB purchases of equity would be a dangerous step. Financial Times, 27–28 July. 65 Summers, L. 2019. The global economy is at risk from a monetary policy black hole. Financial Times, 12 October. 66 See, for example, www.heterodoxnews.com/HEN/home.html

8 Broken cities: unaffordable housing as the norm?   1 BBC News. 2016. ‘Sky-high’ rental hotspots across England revealed. BBC News, 5 May.   2 PricedOut. The campaign for affordable house prices. www.pricedout.org. uk (accessed 4 December 2017).   3 Ibid.   4 Atkin, J. 2017. 9th largest lender is the Bank of Mum and Dad, Mortgage Finance Gazette, 2 May. In 2017, around 117,000 property transactions helped by BoMaD involved parents releasing equity from their own homes or pensions, or using pension income. See Somerset Webb, M. 2018. Bank of Mum and Dad risks going out of business. Financial Times Money, 1 September.   5 Read, S. 2018. Want your own home? Have wealthy parents. BBC News, 8 December.   6 Average monthly mortgage repayments for first-time buyers in 2018 were estimated to be cheaper than renting an equivalent property across the UK: £723 compared with £912. See Somerset Webb, Bank of Mum and Dad.   7 Financial Times. 2018. Mortgage payments to swell for first-time buyers. Financial Times, 17 November.   8 Ministry of Housing, Communities and Local Government. 2018. English Housing Survey: Headline Report 2016–17. London: Ministry of Housing, Communities and Local Government.   9 Cribb, J. 2018. How housing has divided the young. BBC News, 15 August. 10 Cox, H. 2018. Dallas strikes it rich. Financial Times, 29–30 September. 11 HSBC Holdings. 2017. Beyond the Bricks: The Meaning of Home. London: HSBC Holdings; Passy, J. 2017. The American Dream appears to be more attainable in Mexico and China. Marketwatch, 7 May; Seales, R. 2017. The country where 70% of millennials are homeowners. BBC News, 6 April. This survey was based on online sampling, which may be reasonable for this generation; nonetheless, the reliability of these comparative data is questionable. 296

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12 The impacts of deregulation of rents and conditions in the UK’s rental sector and of cuts to housing benefits are analysed in Davis, C. 2013. Finance for Housing: An Introduction. Bristol: Policy Press. 13 Whitworth, D. 2017. Revenge eviction law not working. BBC Newsbeat, 9 February. 14 Private Eye. 2018. Cheap skates. Private Eye 15–28 June, p. 37. 15 Cook, C. 2017. Why do England’s high-rises keep failing fire tests? BBC News, 27 June. 16 Stewart, H., N. Watt & R. Mason. 2015. George Osborne scraps tax credit cuts in welfare U-turn. Guardian, 25 November; Rampen, J. 2016. The benefit changes hitting families, workers and those struggling to pay their housing bills. Daily Mirror, 7 April. The outcry against these welfare changes was widespread in the UK and included those who are not usually radical in their views. Frank Field, the chair of the Commons Work and Pensions Select Committee, noted the ‘glut of evidence from local councils worried about the rent arrears and homelessness that accompanied the arrival [of the welfare changes] … [with] landlords … stunned by having two-thirds of their universal credit tenants in rent arrears’. Field, F. 2018. Wonderland visions of welfare reform collapse on contact with real life. Financial Times, 20–21 October. 17 HM Treasury, Chancellor George Osborne’s Summer Budget 2015 speech. 18 House of Commons Library. 2018. Research briefings: introducing a voluntary Right to Buy for housing association tenants in England. https:// researchbriefings.parliament.uk/ResearchBriefing/Summary/CBP-7224 (accessed 29 August 2018). 19 Clark, R. 2015. Why housing associations are the true villains of the property crisis. Spectator, 25 July. 20 Wall, T. 2018. London tenants to protest at auction of social flats worth £7.2m. Observer, 24 March. This article explains how the 2016 annual report of the HA, Genesis, showed that it had sold 58 social homes to the private sector and that, of the 159 new homes completed, only three were provided at social rents. The chief executive is reported as saying that ‘housing people on the lowest income was not his “problem”’. 21 Capps, K. 2018. Trump’s budget would hammer public housing. CityLab; Sisson, P. 2018. With U.S. affordable housing in crisis, Trump admin wants to cut aid. Curbed, 13 March. 22 Desilver, D. 2018. For most U.S. workers, real wages have barely budged in decades. Washington DC: Pew Research Center. 23 HM Treasury, Chancellor George Osborne’s Summer Budget 2015 speech. 24 In London in 2018, these affordability tests meant that for average properties a potential borrower must prove ‘that at a stress rate of 7 per cent 297

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you’ve got another £1,000 of disposable income [i.e. after tax and nonhousing necessary expenditure] to pay towards your mortgage’. Pickford, J. 2018. As safe as houses? Sales fall and Brexit casts a shadow. Financial Times, 15 September. 25 Pickford, J. 2019. First-time buyers deposits barrier. Financial Times, 3 August. 26 Pickard, J. & J. Evans. 2016. UK ministers slammed for widening ‘affordable’ housing definition. Financial Times, 6 January. 27 Dathan, M. 2015. David Cameron’s solution to the housing crisis: only affordable to those who earn more than £50,000. Independent, 7 October. 28 Fearn, H. 2019. No wonder the government’s housing promises are a complete sham – MPs treat this crisis like an afterthought. Independent, 5 November. 29 Property Wire. 2018. Home builders praise flagship Help to Buy scheme. Property Wire, 6 September. 30 PricedOut index. www.pricedout.org.uk/the_pricedout_index (accessed 20 July 2018). 31 Collins, N. 2018. Market is finding its own solution to the problem of inheritance tax. Financial Times, 12–13 May. 32 BBC News. 2016. David Cameron: We’ll directly commission 13,000 new homes. BBC News, 4 January. 33 Lammy, We’re in a new era of slum landlords and tenant squalor. 34 Jones, H. 2018. Sex for rent: the rogue landlords who offer free rooms in return for ‘favours’. Guardian, 2 April. 35 O’Sullivan, F. 2018. British people feel locked out of London. CityLab, 20 September. 36 Webb, K. 2016. No wonder people are being forced to live in caravans: housing benefit bears no relation to reality anymore. Independent, 21 November. 37 Wainwright, D. 2019. Benefit cuts ‘have made private renting unaffordable’, BBC News, 9 May. 38 Gelblum, B. 2019. Families with children are now being housed in shipping containers due to lack of council accommodation. London Economic, 31 August. 39 Webb, No wonder people are being forced to live in caravans. 40 Butler, P. 2015. Housing raid finds 26 people living in three-bedroom east London home. Guardian, 25 June. 41 One landlord in Haringey in north London created nine ‘flats’ in one house, for example. Haringey Council. 2015. Haringey landlord prosecuted for illegally converting house to nine flats. London Property Licensing, 6 November. www.londonpropertylicensing.co.uk/haringey-landlord-pros ecuted-illegally-converting-house-nine-flats

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42 In Hounslow in south-west London, nearly 400 such illegal outbuildings on private house plots were reported in 2014. Sharma, R. 2014. Building illegal flats, BBC News, 24 September. In Newham, the problem is also rife. Gentleman, A. 2012. The woman who lives in a shed: how London landlords are cashing in. Guardian, 9 May. 43 Hilditch, M. 2016. Survey reveals thousands living in caravans and mobile homes. Inside Housing, 17 November. 44 Data are compiled from Baird, S. 2017. Mobile homeland. Curbed, 13 September; National Housing Unit Characteristics: All Housing Units. 2017. American Housing Survey online data. www.census.gov/programssurveys/ahs.html; Geoghegan, T. 2016. Why do so many Americans live in mobile homes? BBC News, 24 August. 45 StateMaster [USA]. Percent of housing units that are mobile homes statistics. www.statemaster.com/graph/hou_per_of_hou_uni_tha_are_ mob_hom-housing-percent-units-mobile-homes (accessed 4 March 2017). 46 Geoghegan, Why do so many Americans live in mobile homes? 47 Bair, F. 1961. Regulation of Mobile Home Subdivisions. Chicago: American Society of Planning Officials. www.planning.org/pas/reports/report145. htm 48 The New York municipal regulations for mobile homes note: ‘It is through zoning that most municipalities exercise the greatest extent of control over mobile homes.’ See Coon, J. 2008. Municipal Regulation of Mobile Homes. New York: New York Department of State, Division of Local Government Services. 49 Neate, R. 2015. America’s trailer parks: the residents may be poor but the owners are getting rich. Guardian, 5 July. 50 Ibid. 51 Gray, N. 2018. The urbanist case for trailer parks. CityLab, 26 July. 52 Ibid. 53 Goodman, L. 2018. Manufactured homes could ease the affordable housing crisis. So why are so few being made? Urban Wire, 29 January. 54 Gray, The urbanist case for trailer parks. 55 Goodman, Manufactured homes could ease the affordable housing crisis. 56 Al Jazeera. 2014. Mobile homes: many hidden homeless Americans living in vehicles. Al Jazeera, 10 October. 57 Quoted in Quinn, M. 2018. ‘It’s the new form of affordable housing’: more people are living in their cars. Governing, 24 July. 58 Bruder, J. 2018. Nomadland: Surviving America in the Twenty-first Century. New York: W. W. Norton. 59 Davis, K. 2017. Scores of people are living in vans on Bristol streets. Bristol Live, 2 October.

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60 Benedict, K. 2018. Estimating the number of homeless in America: statistics show that America’s homeless problem is getting worse. The Dataface, 21 January. 61 BBC News. 2017. Los Angeles homeless numbers jump 23% in a year. BBC News, 1 June. 62 House of Commons Committee of Public Accounts. 2017. Homeless Households: Eleventh Report of Session 2017–19. London: House of Commons. https://publications.parliament.uk/pa/cm201719/cmselect/ cmpubacc/462/462.pdf 63 Davis, Planet of Slums, p. 36. 64 FEANTSA. 2017. Homelessness in Greece. Country Fiche. Brussels: European Federation of National Organisations Working with the Homeless (FEANTSA). www.feantsa.org/download/greece-2017292 8673074328238317.pdf 65 Chrysopoulos, P. 2016. Most of the Athens homeless are Greeks, victims of economic crisis. Greek Reporter, 31 May. 66 Spain was one of the countries most affected by the subprime mortgage crash, as its lenders’ indulgence in the characteristically egregiously risky lending practices was particularly excessive. Its peculiar mortgage legislation then exacerbated the outcomes as borrowers there remain liable for any debt not recovered by repossession and sale of the property. Elsewhere, foreclosing banks usually bear those losses. Akin, O., J. G. Montalvo, J. García Villar, J.-L. Peydró & J. M. Raya. 2014. The real estate and credit bubble: evidence from Spain. SERIEs, 5, 2, 223–43. 67 Edwards, S. 2017. Homelessness in Spain is on the rise, and owners are getting rough as they try to get squatters out. Newsweek, 19 June. 68 See, for example, Vasudevan, A. 2015. Metropolitan Preoccupations: The Spatial Politics of Squatting in Berlin. Chichester: John Wiley & Sons; Vasudevan, A. 2017. The Autonomous City: A History of Urban Squatting. London: Verso. 69 Royston, L. & M. Clark. 2014. Urbanisation: low-cost housing not lowcost enough. Mail and Guardian, 11 April. 70 For a description of these urban village processes for the Indian city of Gurgaon, see Cowan, Subaltern counter-urbanism. 71 Shanghaiist. 2018. Inside Hong Kong’s cage homes: when houses are the size of parking spaces. Shanghaiist, 16 August. 72 Kwok Yu Lau & A. Murie. 2017. Residualisation and resilience: public housing in Hong Kong. Housing Studies, 32, 3, 271–95, p. 278. 73 Social Surveys Section (2). 2016. Housing conditions of sub-divided units in Hong Kong. Thematic Household Survey Report No. 60. Hong Kong: Census and Statistics Department, Hong Kong Special Administrative Region.

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74 Yi-Ling Chen. 2015. The factors and implications of rising housing prices in Taiwan. In Taiwan–U.S. Quarterly Analysis. Washington DC: Brookings Institute. 75 Everington, K. 2017. Taipei and New Taipei plan to demolish 290,000 illegal structures. Taiwan News, 7 December. 76 Ibid. 77 Ashcraft, B. 2013. Japan’s coffin apartments are not for claustrophobes. Kotaku, 26 February. 78 Alcorn, S. 2013. These photos of tiny, futuristic Japanese apartments show how micro micro-apartments can be. Fast Company, 29 May. 79 Real Estate Japan. 2017. How much living space does the average household have in Japan? Real Estate Japan, 12 August. 80 China Labour Bulletin. 2017. Another tragedy unfolds in Beijing’s migrant worker shanty towns. China Labour Bulletin, 20 November. Similar tragedies continue to occur: see China Labour Bulletin. 2018. Five young kindergarten teachers die in sub-standard housing tragedy. China Labour Bulletin, 20 November. 81 Ngai, P. 2018. Research report on rural–urban migrants’ housing security and housing conditions. English precis. Hong Kong: Department of Sociology, University of Hong Kong. 82 Ibid.

9 Broken cities, broken households: the demographic impacts of unaffordable housing   1 Burton, A. 2005. African Underclass: Urbanisation, Crime and Colonial Order in Dar es Salaam. Oxford: British Institute in Eastern Africa in association with James Currey.   2 Lefebvre, H. 1968. Le Droit à la Ville. 2nd edition. Paris: Anthropos.   3 White, A. 2007. Internal migration trends in Soviet and post-Soviet European Russia. Europe–Asia Studies, 59, 6, 887–911.   4 Cheng, T. & M. Selden. 1994. The origins and social consequences of China’s hukou system. China Quarterly, 139, 644–68.   5 Ngai, Research report on rural–urban migrants’ housing.   6 Edes, A. & S. Inskeep. 2017. In Chinese cities, migrants’ work is welcome. Their children are not. National Public Radio, 16 November.   7 Lin, G. & Fangxin Yi. 2011. Urbanization of capital or capitalization on urban land? Land development and local public finance in urbanizing China. Urban Geography, 32, 1, 50–79.   8 Village land taken over and sold or leased for larger-scale farming by the local government can also lead to compensation with urban hukou for

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villagers, including urban housing and various types of social security benefits. Cai, M. 2016. Land for welfare in China. Land Use Policy, 55, 1–12.   9 Fan, C. 2002. The elite, the natives, and the outsiders: migration and labor market segmentation in urban China. Annals of the Association American Geographers, 92, 1, 103–24. 10 Hancock, T. & X. Wang. 2018. Easing of Chinese residency rules stirs bubble fears. Financial Times, 22–23 July. This strategy by local governments is explained in Chan, K. 2009. The Chinese hukou system at 50. Eurasian Geography and Economics, 50, 2, 197–221; Davies, G. & G. Ramia. 2008. Governance reform towards serving migrant workers. China Quarterly, 193, 140–9. 11 Hancock & Wang, Easing of Chinese residency rules. 12 Ibid. 13 Zuo, M. 2016. Beijing spells out strict residency rules for migrants to the capital. South China Morning Post, 12 August. 14 Roxburgh, H. 2018. China’s radical plan to limit the populations of Beijing and Shanghai. Guardian, 19 March; Cox, W. 2019. Beijing and Shanghai limit population growth. NewGeography.com, 28 March. 15 Hancock & Wang, Easing of Chinese residency rules. 16 Hopps, K. 2016. Newham’s housing crisis is ‘only going to get worse’ says council. Newham Recorder, 6 April. 17 Elkes, N. 2018. London boroughs have moved 181 families to the West Midlands. Birmingham Live, 25 April. 18 Hamnett, C. 2010. Moving the poor out of central London? The implications of the coalition government 2010 cuts to housing benefits. Environment and Planning A, 42, 2809–19. 19 Dearden, L. 2017. Hundreds of homeless people given one-way tickets to other areas by their local councils. Independent, 17 October 20 Ibid. 21 Guardian. 2017. Bussed out: how America moves its homeless. Guardian, 20 December. 22 Hamnett, C. 2014. Shrinking the welfare state: the structure, geography and impact of British government benefit cuts. Transactions of the Institute of British Geographers, 39, 490–50. 23 Li, B. & H. Shin. 2013. Intergenerational housing support between retired old parents and their children in urban China. Urban Studies, 50, 16, 3225–42, citing UNDP, 2005. 24 It is important to note that family units can be the sites of oppressive behaviours, and division can help to avoid this. Both nuclear, and extended, family units can be problematic and the arguments here do not suggest that such households must be promoted. Instead, the issue is about whether families can manage to be together, if they wish – which very many do.

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25 Cosslett, R. 2018. Priced out of parenthood: no wonder the birthrate is plummeting. Guardian, 20 July. 26 Jefferys, P. 2013. Living with the parents: are we Danish or Spanish? Shelter blog. 27 Bulman, M. 2017. Number of young adults living with parents reaches record high. Independent, 8 November. 28 East of England LGA. 2017. Review of research on migration influences and implications for population dynamics in the wider south east. Bury St Edmunds: East of England Local Government Association (LGA). www.eelga.gov.uk/documents/wider%20south%20east%20update%20 reports/extended%20summary%20lse%20migration%20review.pdf 29 Arnett, G. & A. Sedghi. 2014. Europe’s young adults living with parents: a country by country breakdown. Guardian, 24 March. 30 European Federation for Public, Cooperative and Social Housing. 2015. The State of Housing in the EU 2015. Brussels: Housing Europe. www. housingeurope.eu/resource-468/the-state-of-housing-in-the-eu-2015 31 The Local. 2016. 80% of Spaniards under thirty still live at home with parents. The Local, 1 March. 32 Jefferys, Living with the parents. 33 Eurostat. Total fertility rate 1960–2016. https://ec.europa.eu/eurostat/ statistics-explained/images/a/a7/Total_fertility_rate%2C_1960–2016_%28 live_births_per_woman%29.png 34 Li & Shin, Intergenerational housing support, p. 3227, citing Hirayama & Forrest, 2009. 35 Ibid., p. 3229. 36 Ibid., p. 3238. 37 This correlation was calculated by the author using the percentage of adults in this age group who were not living with parents and the total fertility rate for each country in the EU. The data sets used were both from Eurostat: Total fertility rate 1960–2016 (live births per woman); and Share of young adults aged 18–34 living with their parents by age and sex – EU-SILC survey. https://ec.europa.eu/eurostat/web/productsdatasets/-/ilc_lvps08 38 UN-Habitat. 2014. The State of African Cities 2014. Nairobi: UN-Habitat, p. 32. 39 In 2014, 75% of women without children were in the UK workforce and 74.1% of women with children. Catalyst. 2019. Quick Take: Women in the Workforce – UK. New York: Catalyst [Workplaces that Work for Women]. www.catalyst.org/knowledge/women-workforce-uk (2019). 40 Johnson, K. 2017. Data snapshot: 2.1 million more childless U.S. women than anticipated. Durham NH: Carsey School of Public Policy, University of New Hampshire.

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41 Johnson, K. 2018. Domestic migration and fewer births reshaping America. Durham NH: Carsey School of Public Policy, University of New Hampshire. 42 Hamilton, B. 2018. Births: provisional data for 2017. Report No. 004 (May). Hyattsville MD: National Center for Health Statistics. www.cdc. gov/nchs/data/vsrr/report004.pdf 43 Dettling, L. & M. Kearney. 2011. House prices and birth rates: the impact of the real estate market on the decision to have a baby. NBER Working Paper Series No. 17485. Cambridge MA: National Bureau of Economic Research (NBER). 44 Choi, J. H. 2018. The state of millennial homeownership. Urban Wire, 11 July. 45 Ciluffo, A., A. Geiger & R. Fry. 2017. More U.S. households are renting than at any point in 50 years. Washington DC: Pew Research Center. 46 Fry, R. 2017. It’s becoming more common for young adults to live at home – and for longer stretches. Washington DC: Pew Research Center. 47 Pew Research Center. 2014. The rising cost of not going to college. Washington DC: Pew Research Center. 48 OECD. Family database. SF2.1: Fertility rates. Paris: Social Policy Division, Directorate of Employment, Labour and Social Affairs, OECD. www. oecd.org/els/family/database.htm 49 Chetty, P. 2017. Reasons behind the declining fertility rate of urban India. Project Guru, 29 July; Thakur, A. 2016. Fertility rate in India’s urban areas lower than US, Times of India, 14 May; UNFPA. 2011. Impact of demographic change in Thailand. Bangkok: United Nations Population Fund (UNFPA); Viet Nam News. 2017. Dropping fertility rates raise alarm. Viet Nam News, 7 July; Department of Census and Statistics. 2017. Demographic and Health Survey: 2016. Colombo, Sri Lanka: Department of Census and Statistics; Financial Tribune. 2014. Iran’s fertility rate lowest in Islamic countries. Financial Tribune [Iran], 22 November; Saltenyte, U. 2013. Are birth rates lower in cities? Euromonitor International, 23 October. 50 The contribution of migrants to city demography is complex. They tend to be in their most fertile years, which can significantly raise city birth rates even if their fertility levels are the same or lower than the domestic population’s. Also, retired people may leave cities for economic and social reasons, reducing death rates. Natural increase (births minus deaths) can therefore be an important contribution to city population growth despite low fertility, but this is affected by migration patterns. In London, ONS data on local area migration show that of 126,308 births in 2017, 57.9% were to mothers not born within the UK. 51 UNFPA, Impact of demographic change in Thailand. 52 Migrants from particular communities may carve out their own employment cartels in certain sectors by helping each other out with information on job opportunities and credit, but these are often in low-paid jobs. 304

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53 Cowan, Subaltern counter-urbanism, pp. 127–8. 54 The role of circular migration in urban processes across the world and the influence of shifting costs and incomes on the nature of in- and out-migration to cities across Africa, and thus on urbanisation itself, from the 1960s to the early twenty-first century is detailed in Potts, Circular Migration. 55 Bloomfield, R. 2016. The rise of Monday-to-Friday London living: meet the ‘weekly boarders’ who rent in the city and go home to the country at weekends. Evening Standard, 29 March; Koch, C. 2010. Rise and shine, it’s rush hour: a night on a commuter campsite. Evening Standard, 26 August. 56 Potts, Circular Migration. 57 Gugler, J. 2002. The son of the hawk does not remain abroad; the urban– rural connection in Africa. African Studies Review, 45, 1, 21–41, p. 29. 58 The contestations over family migration and the role of housing in this for Africa are discussed in Crush, J. & C. Soutter. 1999. ‘Natural family conditions’: narratives of stabilization and the South African coal mines. South African Geographical Journal, 81, 1, 5–15; Hance, W. 1970. Population, Migration, and Urbanization in Africa. New York & London: Columbia University Press. 59 Vickery, K. 1999. The Rhodesia railways African strike of 1945. Part II: Cause, consequence, significance. Journal of Southern African Studies, 25, 1, 49–71. 60 Schling, H. 2017. (Re)production: everyday life in the workers’ dormitory. Society and Space, 11 July. 61 Caprotti, F. 2011. Eco-urbanism and the eco-city, or, denying the right to the city? Antipode, 46, 5, 1285–303. 62 Asher, S. 2015. Singapore’s construction worker poets. BBC News, 19 March. 63 Kirk, M. 2015. The peculiar inequality of Singapore’s famed public housing, CityLab, 9 June. 64 White, Internal migration trends in Soviet and post-Soviet European Russia. 65 Potts, Circular Migration. 66 Ibid., p. 123. 67 Johnson, Domestic migration and fewer births. 68 East of England LGA, Review of research on migration influences. 69 The ONS made some changes to its internal migration methodology for 2016–17. The main change was to the treatment of students, but this would have served mainly to increase the numbers of in-migrants to London since, of the 20 local authorities with the largest increases in their net internal migration flows, 11 were London boroughs. 70 The proportion of first-time house buyers based in London who purchased their homes outside the city doubled in five years from 16% in 2013 to 31% in 2018; over the same period London house prices rose 305

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by 34%. Pickford, J. 2018. First-time buyers forced further from London. Financial Times, 20 October. 71 In 2015, the domestic net outflow included 30,140 people in their thirties, now prime ages for family formation in the UK. See Ferguson, D. 2017. ‘We didn’t even have room for a table’: meet the 30-somethings fleeing London. Guardian, 11 February. 72 Halliday, J. 2017. Number of Londoners abandoning capital hits 10-year high. Guardian, 29 December. 73 East of England LGA. Review of research on migration influences.

10 Conclusion   1 Tartar, A. & L. Wei. 2017. Mumbai homes more expensive than Shanghai, see which city is least affordable. India Times (Economic Times), 24 October; Tartar, A. & L. Wei. 2017. These cities make NYC housing look dirt cheap: from Beijing to Rio de Janeiro, housing affordability is a challenge. Bloomberg News, 20 October; Swissinfo.ch. 2017. Housing prices are through the roof in these 10 cities. Swissinfo.ch, 4 October; Thakur, P. & A. Tan. 2012. Mumbai is the world’s least affordable home market. Bloomberg, 10 April; Laming, S. 2015. London ranked most expensive world city to live and work, but Hong Kong, Shanghai and Mumbai look least affordable. Savills News, 5 October.   2 Chau, D. 2018. Australian property ‘severely unaffordable’, Sydney crowned ‘second least affordable market’. ABC News, 23 January; BBC News. 2017. Angolan capital ‘most expensive city for expats’, BBC News, 21 June.   3 See www.oecd.org/social/affordable-housing-database.htm   4 Ferguson, J. 2006. Global Shadows: Africa in the Neoliberal World Order. Durham NC & London: Duke University Press.   5 BBC News. 2018. London dominates UK jobs growth over past decade. BBC News, 27 November.   6 Collinson, P. 2018. Berlin tops the world as city with the fastest rising property prices. BBC News, 10 April.   7 Saulwick, J. & T. Rabe. 2019. Immediate reforms: Triguboff’s Meriton wants building industry change. Sydney Morning Herald, 12 July; Saulwick, J., M. Gorrey & L. Visentin. 2019. ‘It hasn’t worked’: premier admits Sydney’s building industry is failing. Sydney Morning Herald, 10 July.   8 Lawford, M. 2019. A far cry from the boom years. Financial Times, 11–12 May.   9 Evans, J. 2019. High-rise, high-spec, high-risk. Financial Times, 29–30 June. 10 See www.zoopla.co.uk/house-prices/haringey/ (accessed 22 November 2018).

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11 Evans, High-rise, high-spec, high-risk. 12 Hirsch, D. & L. Valadez. 2014. Local indicators of child poverty – developing a new technique for estimation. Loughborough: Centre for Research in Social Policy, Loughborough University. These figures are based on relative poverty, the concept most usually used in wealthy countries. In the UK a household with an income below 60% of the national median income is regarded as poor. 13 Nunn, R & J. Shambaugh. 2018. San Francisco: where a six-figure salary is ‘low income’. BBC News, 10 July. 14 O’Neill, J. 2018. Corbyn’s Labour looks poised to shake up the economic status quo. Financial Times, 22–23 September. 15 Patel, S. B., J. Saluja & O. Kapadia. 2018. Affordable housing needs affordable transit. Environment and Urbanization, 30, 123–40. 16 Hulchanski, J. 1995. The concept of housing affordability: six contemporary uses of the housing expenditure-to-income ratio. Housing Studies, 10, 471–91. 17 Kutty, N. 2005. A new measure of housing affordability: estimates and analytical results. Housing Policy Debate, 16, 113–42. 18 Stone, M. 2006. What is housing affordability? The case for the residual income approach, Housing Policy Debate, 17, 1, 151–84. 19 Africa Development Bank. 2011. The middle of the pyramid: dynamics of the middle class in Africa. Market Brief, 20 April; Ncube, M. 2014. The Emerging Middle Class in Africa. London: Routledge; Melber, H., ed. 2016. The Rise of Africa’s Middle Class: Myths, Realities and Critical Engagement. London: Zed Books; Kharas, M. 2010. The emerging middle class in developing countries. OECD Working Paper No. 285. Paris: OECD Development Centre. 20 BBC News. 2017. Housing budget needs review, says trade body. BBC News, 14 September. 21 Copley, From Right to Buy to Buy to Let. 22 Marx, K. Economic Manuscripts: Capital Volume I, Chapter 23. www.marxists.org/ 23 Power, A. 2016. Council estates: why demolition is anything but the solution. London School of Economics and Political Science, 4 March. 24 Lees, The death of sustainable communities in London. 25 Patel et al., Affordable housing needs affordable transit. 26 Minton, Ground Control. 27 Yuan Yang. 2016. Beijing rent ranked world’s least affordable. Financial Times, 21 April. 28 London Chamber of Commerce and Industry. 2016. Threat to London as most emergency service workers living outside the capital. Press Release, 30 June.

307

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29 Lansley, S. & H. Reed. 2013. How to Boost the Wage Share. Touchstone Pamphlet 13. London: Trades Union Congress. 30 Federal Reserve Bank of St Louis, Economic Research [USA]. Shares of gross domestic income: compensation of employees, paid: wage and salary accruals: disbursements: to persons. https://fred.stlouisfed.org/series/ W270RE1A156NBEA 31 Lansley & Reed, How to Boost the Wage Share, p. 8. 32 Ibid., citing research by the Resolution Foundation. 33 Wetzstein, S. 2017. The global urban housing affordability crisis. Urban Studies, 54, 14, 3159–77, citing Jacobs & Manzi, 2013. 34 Ibid., p. 3168. 35 Piketty, T. 2014. Capital in the Twenty-First Century. Cambridge MA: Harvard University Press. 36 Hamnett, C. 1991. A nation of inheritors? Housing inheritance, wealth and inequality in Britain. Journal of Social Policy, 20, 4, 509–36. 37 Hood, A. & R. Joyce. 2017. Inheritances and inequality across and within generations. London: Institute for Fiscal Studies, p. 21. 38 Robinson, Ordinary Cities. 39 The need for such interventions is promoted in David Madden and Peter Marcuse’s book on housing in the Global North, which also argues that housing should be treated as a human right and not left to market forces. Madden, D. & P. Marcuse. 2016. In Defense of Housing. London: Verso. 40 Moreolo, C. 2017. Chile: Chilean pensions under pressure. Investment and Pensions Europe, May. On Brazil and Chile, see also Schipani, A. & J. Leahy. 2018. Brazil’s finance minister eyes Pinochet solution. Financial Times, 3–4 November.

308

Index

‘A Decent Home’: housing standards regulations, England and Wales, 50 Addis Ababa, 74, 84, 170; housing policies, 74 adults living with parents, 224–7, 232; England, 12; London, 12; USA, 229 affordability: definition, 11 affordable housing, xiii, 7, 9, 10–11, 42, 59–60, 62, 67, 72, 86, 91–4, 96, 115, 143, 150, 157, 159, 160, 166–8, 175, 179, 180–1, 187, 196, 198, 215, 217, 221–3, 230, 235, 257, 260–1, 267; conceptualisation, 8, 10; defined as 30% of income, 17, 24–5, 34, 37–8, 107, 135–6, 192, 195, 254–5; definitions, 201, 254 Africa, 4, 9, 14–15, 17–18, 31, 34, 43, 49, 57, 66, 73, 74–5, 85, 88, 93–6, 98, 108, 121–2, 147, 150, 151, 162–3, 172, 209, 217–18, 225, 230, 233–5, 238, 246, 256–7; urban fantasies, 85; see also southern Africa age of marriage, 229 ageing, 23, 156; and housing, 133, 136, 267 aid, 23, 186 American Dream: homeownership, 138, 195, 296n11 Amis, Philip, 34 ANC (African National Congress), 28 Angela’s Ashes, 46–7, 118–20 Angola, 172, 245 anthropology, 250 apartheid, 85, 110–15, 149, 153, 163, 217–18, 222, 237, 255 Arab Spring, 227 Argentina, 147 Artisans’ and Labourers’ Dwellings Improvement Act (Cross Act) (UK) 1875, 77

Asia, 3–4, 34, 49, 66, 73, 85, 88, 95, 108, 121, 147, 176, 209, 211, 224–5, 230 Athens, 181, 207–8 austerity programmes: as result of financial crash, 5, 54, 133–4, 141, 185–7, 222, 260 Australia, 93, 195, 251 backyard shacks, 59–61, 69, 76, 209, 223 Banda, Hastings Kamuzu, 163 Bangkok, 229–30 Bank of Mum and Dad (BoMaD), 194 banks, 4, 27, 127, 142, 183–5, 208 Barcelona, 180 Bayat, Asef, 144, 146 bed spaces: rented, 114, 203, 209, 211 bedrooms, 34, 40, 113, 124, 196, 202; and multi-person households, 38, 53; standards (UK), 53 Beijing, 74, 155, 175, 211, 220–2, 244–5, 260 Berlin, 123, 125–6, 180, 208, 250 Birmingham, 57, 222, 250 Bloomberg Global City Housing Affordability Index, 245, 270–4 Bombay First: regeneration projects in Mumbai, 176 Booth, Charles, 45 Boundary Street housing estate, 104 Bradford, 80 Brazil, 133, 147, 148, 267; middle classes, 31 Brexit, 54, 142, 242 Bristol, 207, 222 Britain, 2, 80, 82, 89, 104–5, 122–3, 125, 132, 142, 162, 192; see also United Kingdom broken cities, 18, 103, 106, 163, 190–1, 215 Buenos Aires, 34, 229, 245 309

B ROK E N C ITIE S building materials, 4, 12, 49, 61, 74, 151, 210; bamboo, 68; corrugated iron, 49, 55; costs, 68–70, 73; environmental impacts, 68; load-bearing properties, 49, 68; soil bricks, 49–50, 68, 163; stabilised soil bricks, 68; straw bales, 49, 68 building societies, 4, 27; Zimbabwe, 24 building standards, 9, 19, 48, 50, 55, 61, 67, 94, 151, 265; and deregulation, 265; appropriate, 163; debates, 71; doubleedged sword for poor, 64; Harare, 20; Zimbabwe, 58–9 building technologies, 12 Bulawayo, 57 Bulgaria, 235 bureaucracy, 177 cage housing, 1, 210, 233 Calcutta, 46–7 Cameron, David, 201 Cameroon, 172 Cape Town, 181 capital cities, 70, 96, 153, 163, 173 capitalism, 13, 74, 87, 89, 91, 93–4, 106, 130–1, 138, 141–2, 146, 154–5, 161, 186, 190, 221, 230, 243, 249, 258, 262; basic requirements, 3–4, 6–7; contradictions, 190; free-market, 4; hegemony, 3–4, 94; regulated, 5; secular stagnation, 190; spatial fixes, 188; subsidised by governments, 103, 130–1, 134, 136, 189–90, 261; variations in practices between countries, 3 caravans: as permanent housing, 203, 209 census data, 204, 207 Central African Republic, 42 Centre on Housing Rights and Evictions (COHRE), 223 Chartered Institute of Housing (UK), 257 Chengdu, 221 chiefs, 122 Child Poverty Action Group (UK), 252 children, 23, 30, 43, 53, 86, 106, 134, 163, 194, 219–20, 223, 225–8, 232, 236, 242, 264, 266; and evictions, 118, 120; and housing, 39, 212, 215, 258; childcare costs, 225, 255; see also families with children Chile, 267

China, 2, 3, 74, 87, 133, 143, 153–6, 161, 174, 195, 209, 212, 218–21, 223, 224, 227, 229, 231, 237; middle-classes, 31; state capitalism, 4; see also hukou registration Chitungwiza, 22 Chongqing, 155 circular migration, 23, 233, 239 citizenship, 113 class, 117; elites, 117, 190; middle-classes, 16, 31, 82, 85, 157, 162, 164, 171, 173, 178, 196, 198, 209, 252, 256–7; proletariat, 91 climate: and housing, 12, 38, 67, 107 collateralised debt obligations (CDOs), 184 colonial cities, 13, 66, 217; urban segregation, 75 colonialism, 13, 21, 74–5, 85, 157, 217 colonias, 6–7, 149–50 communism, 3, 220; and housing, 2, 108, 160 Community Reinvestment Act (USA), 295n57 comparative urbanism, 4, 13, 63, 266 Condition of the Working Class in England, 45 construction sector, 149, 237 consumption, 179, 230, 256, 262 cost of living, 229, 233 cost recovery: and housing policies, 10 Costa Rica, 147 Council for Youth (Spain), 226 council housing (UK), 6, 53, 104–6, 136, 159, 162, 166–7 credit, 119, 134 credit rating agencies, 28 Crisis (UK), 204 Cuba, 2 culture, 82, 139, 242; and housing, 12 Czech Republic, 235 Dakar, 96 Dar es Salaam, 87, 96 Davis, Mike, 91, 93, 121, 207 de Soto, Hernando, 139 debt, 140, 164, 172, 225, 289n1 debt crisis, 164 decent housing, 4, 9, 10, 15–17, 33, 34, 40, 44, 48, 50, 53, 58, 76–8, 83–4, 87, 89, 92, 99, 101, 103–5, 108–9, 115–7, 122, 129, 131, 133, 135–6, 142, 146,

310

Ind e x European Union (EU), 6, 142, 235, 242, 246; housing report, 226 evictions, 45, 93, 95, 118–20, 125, 145, 148, 151, 174–9, 187, 202, 216, 222–3, 263 expropriation: of housing, 174, 178–9; of land, 96, 143, 220

148, 159, 169–71, 182, 191, 193, 197, 202–7, 213, 215, 231, 234, 236–7, 252, 263, 266 democracy, 27, 217–18 demographic sifting, 258, 265–6 demography, 44, 225, 250; birth rate, 228–9; China’s one-child policy, 229; death rate, 163, 265; fertility, 88, 148, 156, 214, 216, 221, 224–5, 227–9, 258, 264, 267; infant mortality, 42, 46; urban, 20, 214–16, 229, 261, 264 demolitions, 20, 60–2, 69, 75–6, 81, 148, 157, 175, 178, 180, 221 Denmark, 226, 227 Depression (1930s), 105, 140 deregulation, 123, 140–1, 193, 195; see also financial deregulation destitution, 132, 185, 239 Dharavi, 176–8, 210 Dickens, Charles, 44–5, 119–20, 132 disease, 67 Dorling, Danny, 40 Durban, 29–30 eastern Europe, 2–3, 107, 125, 153, 156, 161, 231 economic development, 141 economic policies, 141; cost recovery, 6, 26, 151, 165, 254; free market, 42, 123; heterodox, 190 Edinburgh, 42, 45–6, 59 elderly people, 40–1, 111, 120, 132, 142–3, 224, 236, 239, 266–7; see also ageing, pensions elections, 54, 60, 162, 167, 176, 193 emigration: from Europe during Industrial Revolution, 44 employment, 11, 18, 99, 105, 108, 115, 120, 130, 149, 170, 173, 175, 180, 188, 216, 219, 229, 230–1, 235, 242, 259 empty housing, 8, 40, 93, 156, 208, 220, 257 Engels, Friedrich, 45 essential service workers: effects of high housing costs, 32, 35, 260 Ethiopia, 74, 171–2; modes of production, 172 ethnicity, 109 Europe, xiii, 21, 42–3, 46, 50, 81, 85, 89–90, 108, 122–7, 143, 146, 154, 183, 188, 204, 208, 225, 226–7, 229, 246; informal housing, 10

families: and housing, 2, 22–3, 39, 43, 51, 64, 84, 108, 111–12, 114, 139, 153, 154, 204, 216, 219, 221, 223–30, 232–3, 236, 238, 243, 258, 267; living apart, 1, 23, 217, 220, 231–4, 237; living together, 23, 53, 224, 232–5, 239 families with children, 34, 38, 84, 125, 143, 197, 219, 223–6, 243, 255, 267; and housing costs, 53 Fannie Mae (Federal National Mortgage Association), 140, 185, 295n56 favelas, 1, 182 female-headed households, 86, 223 Ferguson, James, 250 financial crash, 79, 83, 86, 133, 136, 140–1, 183–92, 194, 196, 198, 207–8, 222, 225, 228, 244, 246, 251, 260, 263; as proof of housing dilemma, 5; subsequent state interventions, 5, 185–7, 189–90, 261 financial deregulation, 183–4, 186, 262; Garn–St. Germain Act, 183; Glass– Steagall Act, 183 flooding, 47 Florida Homelessness Action Coalition, 223 food: budgets, 32; security, 31, 134 foreclosure, 4, 185, 208; see also repossessions foreign donors, 72, 170 France, 195, 226 Freddie Mac (Federal Home Loan Mortgage Corporation), 140 gated housing, 85, 259 gecekondus, 182 Generation Rent, 1, 193–4 Generation X, 228 Geneva, 127 gentrification, 12, 86, 168, 179–82, 206, 261 Germany, 88, 124–7, 180, 249 GI Bill (USA): subsidies for homeownership, 140

311

B ROK E N C ITIE S Gilbert, Alan, 34, 121, 124, 146, 283n1, 278n4 Glasgow: public rental housing (PRH), 115; slums, 76 global cities, 8, 159, 193, 221, 249–52, 261, 266–7, 269–74 global finance: and housing, 159, 176–81, 183–90 globalisation, 81, 165, 193 governance, 166 Greece, 207–8, 226, 249 Grenfell Tower, 195 Gross Domestic Product (GDP), 18, 185, 262 Ground Control, 260 Guangzhou, 211, 221, 229 Guatemala, 147 Gugler, Josef, 146, 234 Gurgaon, 232 Harare, xii, 8, 20–6, 33, 49, 57, 59–61, 113, 117, 151, 153, 169, 239, 267; evictions, 20; hyperinflation, 20; poverty levels, 20 Harare residential areas: Glen Norah, 24–5, 27, 151, 169; Glen Norah C, 24–7; Hatcliffe, 61; Hatcliffe Extension, 61; Highfields, 22, 113; Kuwadzana, 22, 24, 33; Mabvuku, 22; Mbare, 59 Harrogate, 193 health, 44, 55, 67, 109, 117, 130, 185–6, 202, 211, 225, 243, 259; and housing, 10, 52; impact of inadequate housing, 43–7, 55, 66, 97, 106, 117, 122, 164, 195, 214, 265; impact of long commutes, 259; public, 39, 77, 163; urban indices, 9 health workers, 130 heating costs, 38, 49, 51, 82, 107, 116, 135, 136 Help to Buy (UK), 103, 198, 199 Heygate Estate, 178 Home Builders Federation (UK), 199 homelessness, 11, 40, 42, 61–2, 70, 86–7, 132, 143, 158, 187, 202–9, 216, 222–3, 242, 250, 251, 263 homeowners, 9, 22, 24, 54, 58, 61, 69–70, 95, 121, 141, 144–7, 181–2, 194 homeownership, 6, 40, 58–9, 83–4, 86–91, 93, 99, 103, 113, 121, 124, 127, 137–58, 160, 168, 195, 198, 228, 231, 239, 253, 257, 263–4, 267–8; falling rates for young adults, 193, 195, 228,

264; ideologically conservatizing, 89, 139; subsidies from state, 90, 138, 140–1; supported by state, 89, 91, 263, 267, 295n56 homes, as opposed to houses, 1, 51, 116, 118, 120, 139, 204, 215, 227, 232, 244, 251, 258, 266–7 ‘Homes for Heroes’ (UK), 105 Hong Kong, 1, 210, 244, 250 house prices, xiii, 82–3, 86, 141, 181, 187–8, 198, 221, 225, 228, 246–51 housebuilding sector, 72–87, 167; formal, 10, 79–86; informal, 56, 72; large scale companies, 4; UK, 79–80, 200 household budgets, 23, 32–3, 36, 117, 133, 154, 255, 262 household composition, 21, 109, 214–18, 224–8 household formation, 84, 88, 216, 224–6, 232 household income, 29, 35, 97, 127, 165, 170, 199, 200, 207, 228, 254, 264 household members: dependents, 235; sons, 30, 168; spouses, 23; wives, 235 household welfare, 31 households: ‘single’ person, definition, 280n21 housing: as a public good, 261; formal, 14, 18–19, 34, 56, 76, 113, 151, 209; informal, 15, 16, 20, 21, 29, 56–7, 73, 87, 91, 97, 102, 142, 157, 211, 256; legal, 4, 10, 15, 29, 84, 101, 219 housing activists, 40, 174, 180, 204, 208, 223, 254, 268 housing affordability, xii–xiii, 10, 18–21, 30, 35–6, 38, 53, 63, 65, 68, 80, 83–4, 87–90, 107, 127, 152, 158–62, 183, 188, 197, 203, 208, 216, 223–4, 227, 234, 249–50, 254, 260–1, 263–4 conceptualisation, 254; definitions, 19 housing affordability curves, 26–7, 70, 83, 86, 123, 135; Glen Norah C, 25; graph, 26; South Africa, 27 housing associations, 79, 166–7, 195, 197 housing benefits (UK), 131, 136, 168, 197, 203, 222–3, 267; cuts, 202 housing cooperatives, 127, 129, 150, 266 housing cost overburden rate (OECD), 246, 249, 275–7 housing costs, 12, 18–9, 22, 24, 30, 33, 38, 42, 48, 69, 84, 100, 107, 132, 136,

312

Ind e x 154, 170, 186–7, 201, 206, 215, 224–6, 230, 233, 239–40, 245–6, 249, 251–60, 267; competing with other basic needs, 24, 31 housing demand, 12; as basic need, 2, 79; monetary, 2, 7–9, 40, 43, 79, 80, 90, 94, 116, 126, 175, 186–7, 215, 220, 231, 252 housing dilemma, 8, 13–16, 19, 23, 27–8, 36–40, 47–48, 56, 63, 78, 83–4, 86–90, 98, 100–3, 105–8, 110, 112, 114–16, 121–3, 125, 127–38, 140–2, 144, 148, 150, 154, 156, 158–9, 161–2, 164–5, 167–8, 171, 180, 183, 185, 187, 191–2, 198–9, 202–3, 205, 208, 217, 219, 221, 224–5, 229–32, 236, 243, 245, 249–52, 254, 257, 259, 261–7; definition, 2, 10; Harare, 24; England, 80; London, 80; mitigated by public policies, xii, 10, 100–37, 190, 264; structural similarities between Global South and Global North, 9, 48, 63 housing extensions, 59, 61–2, 70, 73, 145 housing finance, 5, 27, 34, 50, 64, 107, 126, 140, 151, 183–5; constraints of profit orientation, 4–5, 26; financial institutions, 4, 5, 12; formal sector requirements, 4 Housing Health and Safety Rating System 2006 (HHSRS) (UK), 50–4 housing histories, 12, 20, 22, 74, 108, 110, 126, 152, 265, 268 housing markets, 12, 30, 40, 48, 74, 77–8, 83, 85, 88–91, 101–2, 107, 127, 140, 180, 189, 195, 215, 219, 226–7, 245, 262, 266–7; effectiveness for higher income groups, 11; formal, 7, 41, 90, 122, 181; informal, 122; segmented, 7–9, 16, 245; super-prime, 188, 251 housing programmes, 4, 6, 90, 100, 103, 110, 115, 159, 182, 197, 198, 253; influence of ideology, 21, 78, 263; involvement of private finance, 4; means testing, maximum income, 24, 169; means testing, minimum income, 24–5, 165, 169; too expensive for target groups, 19, 26, 169, 170–3, 199, 256–7 housing provision: private sector 72–99; public sector 100–37; see also housing supply, housebuilding sector housing shortage, 21, 26, 28, 69, 150, 222 housing speculation, 40

housing standards, xiii, 9–10, 39, 42–71, 92, 95, 116, 130, 151, 169, 202, 204, 206, 211, 213, 215, 255, 258; and deregulation, 195–6, 251, 265; debates, 67–71; decent, 37; double-edged sword for poor, 42, 48, 62; essential for human welfare, 43, 70; Global North, 48, 62; Global South, 55–6, 62; inappropriate, 48, 56; non-compliance, 56, 96; UK, 48–9, 53; used punitively, 48 housing subsidies, 21, 27–8, 48, 56–8, 73, 82, 88, 102–3, 107, 114, 129–33, 136, 140, 151, 154–5, 161, 165, 167, 169, 171, 180, 187, 191, 196–7, 205–6, 208, 237, 250, 257, 260–1, 263–4, 267; reductions under neoliberalism, 10; supporting private housing sector, 5 housing supply, 1, 8, 19, 263; as explanation for unaffordable housing, 1, 7; factors influencing, 12; formal sector, 10, 39; informal sector, 9, 12 housing tenure: insecure, 263; private purchase, 16, 123, 140–1, 143, 226, 229; renting, 23, 33, 35, 55, 72, 80, 86–8, 102, 118, 120–1, 123–5, 128, 138, 147, 149, 153, 155, 169, 172–4, 182, 192–3, 195, 200, 207, 211, 220, 229, 232, 240, 245, 249, 253, 267; secure, 28, 30, 64, 123, 148, 181; squatting, 59, 60, 108, 110, 145–6, 164, 208 housing-induced poverty, 255 hukou registration (China), 133, 154, 212, 218, 220–1, 223, 231 Ilford, 212 IMF (International Monetary Fund), 28, 162, 246, 248; Global Housing Watch data, 246–8 immigrants, 150, 230; and housing, 237–8; skilled, 231 immigration, 8, 142, 230, 238 imperialism, 13 income inequality: increasing, 264 incomes: compared to housing costs, 17, 263, 265; disposable, 12, 31, 35, 38, 70, 117, 225, 246, 255, 275–7; hard limits on housing expenditure, 30–1, 33–4, 140; real, 136, 187, 208, 233, 239, 264; urban, 40, 80, 239 incrementalism see housing types: site and service

313

B ROK E N C ITIE S India, 174–5, 209, 253; middle-classes, 31 Industrial Revolution, 43–4, 81, 106 industrialization, 143, 219; deindustrialization, 163 industry, 103, 112, 160, 196, 199, 251; manufacturing, 220 inflation, 123, 126, 135–6, 196, 207 influx control (southern Africa), 111, 113, 239 informal housing: definition, 56 informal sector, 33, 185, 231; conceptualisation, 9 informal settlements, 7, 9, 20, 33, 56, 74, 92–51, 113–14, 117, 121, 128, 145, 148–50, 172, 175, 209, 212, 238, 245, 265 infrastructure, 17, 22, 69, 87, 109, 113, 117, 130, 147, 149, 151, 157, 243, 260 inheritance: and housing, 156, 161, 231, 264, 267 interest rates, 83, 141, 187, 189–90, 194, 198; at record lows, 189 International Labour Organization (ILO): and decent work, 50 International Monetary Fund, 28 investment, 44, 86, 102, 104, 110, 127, 140, 142, 150, 183, 188–90, 194, 205 Islamic cities, 68 Istanbul, 74 Italy, 226 Japan, 136, 190, 227 Jesuit Centre for Theological Reflection (Zambia): urban budget data, 32, 255 Johannesburg, 29, 30, 112–44, 209 Kano, 74 Kenya, 96–7, 117 Kibera, 118, 172, 210 Kiev, 244–5 Kilamba, 173 Kinshasa, 85, 96 kinship, 232 Kisumu, 96–7, 117 Kochi, 74 Kutty, Nandinee, 255 labour, 258; trade unions, 32 labour markets, 30, 40, 48, 227, 265, 267; segmented, 8, 231; see also low pay Lagos, 84, 85, 96, 181

Lammy, David, 201 land occupations, 63 land ownership, 73, 77, 98, 118, 177, 239 land speculation, 40 land supply: and housing costs, 1, 7–8 land tenure, 21, 71, 85, 92, 93, 221; capitalist, 57; indigenous, 21, 93–8, 145, 150, 209, 217, 231; non-capitalist, 5, 21, 56–7, 95, 98, 122, 145, 209, 231; pre-capitalist, 74; squatting, 56 land titles, 71, 95 land value, 12, 220, 260, 264 landlords/ladies see lessors Latin America, 4, 34, 63, 74, 85, 121, 146–8, 225, 229–30 Lefebvre, Henri, 217 Lendlease property developers, 178–9 lessors, xiii, 34–5, 43, 78, 80, 83, 96–7, 116–23, 125–6, 128–31, 168–9, 181–2, 201, 211, 261; absentee, 59, 119, 121, 147 Lilongwe, 163, 164, 209 Limerick, 46, 119 Lisbon, 1, 148, 181 Little Dorrit, 119 livelihoods: urban, xii, 21, 170 local government, 36, 54, 65, 104, 127, 162, 166, 167, 186–7, 197, 203, 205, 212, 222, 243, 261 lodgers, 23, 59, 73, 116, 122, 267; see also renters London, xii–xiii, 1, 15, 19, 24, 34–7, 81–3, 104–5, 118, 119, 120, 124, 128, 135, 167, 168, 170, 178–80, 186, 188, 192–5, 199, 201–3, 209, 211–13, 222–3, 225–6, 229, 233, 240, 242–4, 246, 250–2, 260–1, 267; Haringey, xii–xiii, 8, 35, 179, 251, 267; graph of housing dilemma, 36; migration trends, 240–2; Newham, 203, 222; slums, 77; underground railways, 80 London Chamber of Commerce and Industry, 260 Los Angeles, 41, 136, 146, 206–7, 244 low pay, 16, 38, 41, 92, 170, 180, 198, 225, 236, 245, 261; and housing dilemma, 16, 32–3, 108, 115, 131, 133, 136, 234, 236, 263 low-cost housing, 160, 177 low-income housing, xii, 3–4, 6, 9, 11, 16, 19, 22, 27, 33, 43–4, 102, 106, 118,

314

Ind e x 160, 163, 169, 171, 173, 185, 198, 206, 253 Luanda, 173, 244, 245 Lusaka, 32–3, 82, 256 Malawi, xii, 21, 24, 163–6, 171, 209 Malawi Housing Corporation, 164 Malaysia, 195 malnutrition, 117, 121, 196 Manchester, 37, 84, 193, 222, 250 Maputo, 96 market forces, 2, 4, 6, 9, 16, 23, 40–1, 50, 69, 72, 76, 78, 87–8, 90, 100–1, 105, 121, 126, 144, 160, 168, 181–2, 195, 205, 242, 249, 253–4, 260, 264–6; and allocation of resources, 159; as a factor in unaffordability of housing, 19, 108, 253 market imperfection: as a factor in unaffordability of housing, 4, 100–2 market signals, 128 marriage, 224, 227 Marx, Karl, 258 Marxism, 190, 258 McCourt, Frank, 46, 118 medicine, 117 Mexico, 65, 150, 154, 195, 204, 229; colonias, 62, 63, 65; urban planning regulations, 64 Middle East, 67 middle-income poaching, 19, 168–70 migrant labour, 22 migrants, 8, 23, 25, 44, 89, 92, 114, 121, 149, 154, 156, 175, 212, 214, 216, 218–21, 230, 231–5, 239–42; and housing, 211, 230–6, 239; and urban demography, 304n50 migration: net, 88, 230, 239 migration controls, xii, 217, 238; and housing, 57, 216; propiska (USSR), 107; USSR, 218; see also hukou registration (China), influx controls (southern Africa) migration theory, 216 mines, 112 minimum wages: inadequate for decent housing, 36, 38 minorities: discriminated against in housing, 128, 295n57 Minton, Anna, 260 mobile homes see trailer housing (USA) mode of production, 3, 73–5, 146

modernity, 104 morality, 161 mortality, 51 mortality rates, 43 mortgages, xiii, 5, 12, 24, 26–7, 40, 59, 127, 139, 140, 151, 171, 183–4, 186, 194, 236, 257, 267; tax relief, 90, 140, 289n5 Moscow, 46, 245 Mumbai, 74, 84, 118, 147, 175–6, 178, 210, 244–5, 250, 260 Nairobi, 34, 85, 117–18, 172, 210 Nakagin Capsule Tower, 210 Namibia, 20–1, 57, 113, 153, 156, 172 National Living Wage (UK), 37, 134–5 National Low Income Housing Coalition (USA), 38 nationalisation, 107, 154, 185 neoliberal capitalism, xii, 5–7, 58, 79, 81, 106, 109, 124, 130, 166, 176, 190, 209; policies, 6, 186 neoliberal turn, 6, 10, 138, 151, 160–1 neoliberalism, 24, 91, 100–1, 138, 142, 147, 151, 153, 161–5, 168, 171, 175, 178, 186, 191, 197, 239, 242, 249, 255, 264; ideology, 5–7, 54, 78, 139, 142, 159, 162, 182, 184, 186, 208, 249 New Taipei, 210 New York, 15, 18, 46, 118, 123, 136, 250; child poverty, 18 New Zealand, 93 Nicaragua, 147 Nigeria, 174 Nixon, Richard, 183 Nomadland: Surviving America in the Twenty-first Century, 207 non-governmental organizations (NGOs), 146, 166 North Africa, 227 North America, 9, 43, 85, 88, 93, 123, 143, 154, 183, 225; informal housing, 10 OECD housing affordability data, 246, 249, 275–7 office conversions (UK): to housing units, 212–3 Old Nichol slum, 77, 104, 117 Operation Murambatsvina (Zimbabwe), 61, 223; and United Nations, 61 Ordinary Cities, 266

315

B ROK E N C ITIE S overcrowding, 19, 45–6, 51, 53, 59, 67, 76, 87, 97, 99, 106, 108, 111, 114, 155, 164, 201, 203, 208–13, 220, 231–4, 238, 240 Panama, 147 Paraguay, 147 Paris, 15, 148, 174, 211 pensions, 16, 23, 40, 51, 132–3, 136–7, 185, 218, 249, 264; inadequate to cover housing costs, 40, 267 per capita incomes, 13 Peru, 147 philanthropy and low-income housing, 15, 76, 78, 104; Guinness Trust, 104, 166; Peabody Trust, 15 Piketty, Thomas, 263–4 Planet of Slums, 91, 98, 207 police, 221, 260 political economy, 172 politicians, 61, 98, 117, 143, 167, 234, 252, 257 politics, 13, 31, 115, 123, 144, 162, 193; and housing, 109; resistance to provision of public housing, 7, 77, 89, 109, 160 poverty, 14, 16, 18, 27, 38–9, 43, 67, 92, 111, 113, 131–2, 149, 163, 197, 208, 222–3, 245, 252, 255–7, 263–4; measurement, 31–3, 256; multifaceted, 33, 44; urban, 18, 21, 31, 35, 121, 256 poverty datum line, 31–3 poverty incidence: effect of housing costs, 32, 252 poverty mapping, 252; London, 45; urban Britain, 252 pre-capitalist cities, 73 pre-capitalist societies, 74, 93 pre-colonial cities, 217 Pretoria, 57 PricedOut, 193, 200 privacy, 1, 10, 16, 35, 51, 53, 84, 108, 116, 227 private property, 3, 5, 10, 54, 61, 77, 139, 161 private rental sector (PRS), 16, 37, 54–5, 115, 121, 201; formal, 122, 157 private sector, 5, 16, 19, 75, 77, 83, 85, 87, 89, 99, 101–2, 105, 107–8, 118, 125, 131, 133, 135, 139, 143, 145, 161, 177, 179, 191, 197, 203, 257, 260, 264;

formal, 24, 27, 99, 158, 192; lobbying re housing policies, 54 privatisation, 161–2, 169, 174, 186, 197; of public housing stock, 22, 88, 152–7, 160–2, 166, 168; of public rental housing, 227, 231 proletarianisation, 132; risks of unemployment, 23, 106, 111 property developers, 96, 101–2, 126, 147, 152, 160, 171, 178, 182, 189, 212, 221, 244, 256–7, 261, 264 Public Health Act (UK) 1875, 77 public rental housing: UK, 131 public rental housing (PRH), xii, 10, 20, 53, 78, 103, 106–10, 114–15, 122, 152, 153–5, 157, 160–2, 165, 167–8, 173, 178, 194, 196, 202, 212, 227, 231, 254, 257, 268; see also council housing (UK) public sector housing, 6, 22, 56, 78, 79, 104–9, 111, 114–16, 127, 133, 136, 142, 144, 146–7, 152, 154–5, 157, 160–2, 185, 197, 201, 203, 226, 236, 266; stigmatised, 160; under communism, 2, 88, 155, 161, 218 purchasing power, 198, 233 quiet encroachment, 144, 150, 152, 154, 157 race, 75, 85, 115, 136; see also segregation Rachmanism: abusive landlords, 128, 201 racism, 21–33, 75, 259 Reagan, Ronald, 162 refugees, 231 regeneration projects, 152, 179, 181, 186, 187, 221, 257, 260–1, 264 regularisation of informal settlements, 65, 93–4, 102, 145, 148–9, 157, 173, 181, 212, 265–6; and rising housing costs, 181 religion, 85, 109 removals from cities: UK, 222–3; USA, 223 rent collectors, 119–20 rent controls, 3, 16, 23, 102, 122–3, 125, 127, 157, 164, 268; see also rent-setting rent subsidies, 53, 54, 100, 108, 129, 130–1, 133, 136, 165, 196, 204, 213; housing benefit (UK), 129–31, 133, 136, 165, 196, 204, 213; vouchers (USA), 102, 107, 197 rental housing, xiii, 2, 12, 23, 32–40, 43, 50, 53, 54, 64, 69, 70, 72, 76–7, 80,

316

Ind e x 83–4, 86, 93, 96, 99–100, 102–9, 112, 114–17, 120, 123, 125–9, 131, 133, 135–6, 141, 145, 161, 164, 167, 169, 170–2, 179–81, 186, 192, 194–8, 201–5, 207, 209, 225, 236, 238–9, 245, 249, 251, 254, 257, 260, 263, 267; affordable, 102; see also public rental housing, public sector housing renters, 9, 24, 69, 117–18, 120–1, 125–7, 131, 139, 145, 157, 194, 205, 229, 255 rent-setting: according to incomes, 2–3, 105–9, 286n5; by market forces, 23 repossessions, 208; see also foreclosure reproduction of labour, 258 rickets, 46 Right to Buy (UK), 168–70; Housing Act 1980, 159–60, 162, 168 right to the city, 92, 109, 115, 153–4, 175, 217–18, 223, 237, 268 Rio de Janeiro, 1, 84, 181, 229, 245, 250 Robinson, Jenny, 266 Romania, 154, 235, 249 row housing, 238 rural land: subdivided for urban plots, 63–4, 93, 96–7, 148 rural slums: South Africa, 113 Russia, 108, 153–4, 156, 161, 238; see also USSR, Soviet Union salaries, 194, 260 Salisbury, 113 Saltaire: model worker housing, 80; terraced housing, 81; UNESCO World Heritage Site for Industrial Revolution, 80 San Francisco, 180, 206, 252 sanitation, 9, 30, 39, 44, 47, 49, 50–1, 55, 58, 63, 65, 69, 111, 113, 117, 151, 172, 177, 181, 206, 211, 233; pit latrines, 69 sanitation syndrome, 66, 75–6, 174 Scotland: housing, 78, 115 segregation, 20, 112, 259, 260; see also white minority regimes (southern Africa) self-help housing, 72 Seoul, 181 Serrekunda, 55 Shack/Slum Dwellers International, 146 Shanghai, 155, 175, 211, 221, 229, 245 shared housing, 37, 39, 135, 192, 220, 226, 232

shared rooms, 23, 38–9, 45, 59, 86, 202, 211, 232–3; multi-households, 46 sheds, 203, 209, 233, 238 Shelter: campaigning group, 192, 202, 226 shelter poverty concept, 255 Shenzhen, 1, 211 shipping containers: used as housing, 203 Singapore, 141–4, 154–5, 237, 244 site and service housing, 10, 20, 22, 24, 26, 29, 57, 58–60, 150–1, 153, 157, 163, 165, 172 Slovakia, 235 Slovenia, 154 Slovo, Joe, 28 slum clearance, 15, 77, 104, 105, 174; Global North, 122; UK, 76 slums, 15, 17, 32, 42–6, 55–6, 76–8, 80–1, 86, 91, 97, 99, 100, 104–5, 109, 117–18, 122, 142, 147, 148, 150, 157, 164, 172–8, 181–2, 201–2, 211–12, 238, 265; Cowgate, 42, 46; Global North, 9, 18, 43, 46, 80, 99, 213; Global South, 9, 12, 99, 210; Kibera, 118, 172, 210; overused term, 73, 76, 278n4, 283n1; UK, 76 social capital, 97, 231 social contracts, 90, 105, 146–7, 159, 185; Global North, 39 social engineering, 109–10, 174, 220, 223 social exclusion, 92, 101 social grants, 16, 134; China, 218 social heterogeneity, 109 social housing, 2, 100–37, 253; affordable, 2, 10, 12, 16, 54, 100, 194, 196, 226, 253; unaffordable for poor, 257; see also housing programmes, public rental housing social security: absence, 23; opposition to, 54, 160 sofa-surfing, 207 South Africa, xii, 1, 20–1, 27, 29–30, 40, 57, 74, 85, 96, 110–15, 133, 149, 152–3, 163, 231, 246, 255; housing White Paper, 27, 28; low-income housing policies, 28; RDP houses, 29–30 South Korea, 229 south-east England: migration trends, 241 southern Africa, xii, xiii, 19–21, 110–11, 113–14, 155–6, 160, 209, 217, 219, 234, 237 Southern Rhodesia, 22, 113

317

B ROK E N C ITIE S Southwark Council: and regeneration projects, 178 Soviet Union, 88, 153, 238; see also USSR, Russia Soweto, 33, 113–14, 153 space: in housing, 10–11, 15–16, 20, 30, 32, 35, 39, 51, 53, 67, 76, 84, 103, 113, 116–17, 124, 128, 148, 155, 157, 201–3, 206–15, 219, 225, 227, 230, 232, 236, 240, 258, 259 Spain, 88, 208, 226, 249 squatter settlements, 15, 57, 93, 94, 96, 97, 113, 142, 148, 165, 181 squatters, 1, 15, 28, 93–4, 96–7, 113, 118, 145, 148, 165, 181, 208 St Petersburg, 46, 59 standards of living, 134 starter home programme (UK), 199 state: reduced role under neoliberalism, 6, 159; role of in development, 12, 106, 134, 252 State of Latin American and Caribbean Cities, 148 Stone, Michael, 11, 278n3 stress: caused by poor housing, 67, 214 structural adjustment policies, 34, 60, 91, 151, 163, 164, 209, 233, 239; conditionality, 165 subdivided units (SDUs), 210–11, 219 subprime mortgages, 183–4, 208, 263; NINJA loans (No Income, No Job, No Assets), 184 suburbs, 20, 49, 59, 61, 80–1, 90, 182, 233, 240, 259; transport, 80 Summers, Lawrence, 190 Surplus People Project, 113 Suzhou, 211 Sweden, 226–7, 249 Sydney, 180, 244, 250; and housing deregulation, 251 Taipei, 181, 210 Taiwan, 210 take-home pay see disposable incomes Tanzania, 87 taxation, 83, 90, 129, 134, 143, 167, 189, 196, 198, 243 tenants, 70, 96–7, 107, 116–28, 131, 152–5, 157, 159, 161, 168, 176, 180–2, 193, 195, 197, 201, 231 tents, 233

terraced housing, 80–2, 84 Texas, 48, 64–6, 149–50, 204; building standards, 65; colonias, 62–3, 65; urban planning regulations, 64, 66 Thailand, 230 Thatcher: Margaret, 79, 123, 161–2 The Big Short, 184 The Challenge of Slums, 91 The Gambia, 48, 55 Tianjin, 155, 221, 227, 229 Timbuktu, 74 Tokyo, 84, 210, 244 tourism, 180, 242 town boundaries, 96 townships (southern Africa), xii, 20, 22, 59, 110–15, 153, 209 Traditional Housing Areas (Malawi), 163–5 trailer housing (USA), 204–6, 209 transfer: of public housing stock, 103, 152, 156, 160 transport, 12, 35, 84, 90, 111, 114–15, 117, 144, 173, 259, 260; commuting, 149, 175, 240, 259, 265; railways, xiii, 80, 235; roads, 22, 59, 64, 69, 132, 145, 149, 164, 173, 212, 260 transport-and-time dilemma, 259 Turkey, 182, 229 UAE, 195 UN Universal Declaration of Human Rights, 224 unaffordable cities, 244–5 unemployment, 16, 24, 40, 115, 131, 160, 165, 188, 193, 198, 218, 231, 239, 242 UN-Habitat, 17, 91, 98, 121, 147, 148, 150, 172, 181, 223; definition of slum, 19, 32, 279n2 United Kingdom, xii, xiii, 6, 34–8, 40, 45, 48–54, 56, 66, 68–9, 71, 73, 76, 79–80, 83–4, 86–7, 103, 105–7, 116, 128–36, 141–2, 144, 159–62, 165–70, 174, 185–88, 192–203, 207–8, 212–13, 215, 222–3, 225–8, 231, 233, 237, 242, 249–50, 252–3, 257, 260, 262, 264 United Nations, 17, 62, 98, 121, 148 United States of America, 16, 64, 83, 85, 89–91, 106–7, 109, 118, 123, 135, 138–41, 150, 160, 162, 183–5, 188–9, 195–8, 204–7, 223–4, 228–9, 240, 252, 254–5, 262; minimum wages, 38; public housing policies, 107

318

Ind e x unplanned housing, 28, 91, 100, 120–1, 144, 163, 217 upgrading, 20, 56, 66, 82, 145, 147, 150, 157, 165, 172–3, 175, 212 urban amenities, 82, 84, 115, 182, 217, 242, 258 urban born, 231, 232 urban infrastructure, 9 urban land: high costs, 69; see also land supply, land values urban penalty, 43–4 urban planning, 55, 58, 61, 148, 259 urban population growth, 239 urban services: electricity, 17, 22, 32, 50, 61, 63–6, 82, 97, 111, 117, 144–5, 148, 172, 211, 233; waste disposal, 49; water provision, xiii, 9, 17, 22, 30, 32, 43–4, 49–51, 55, 58, 61, 63–7, 69, 97, 111, 113, 116–17, 120, 145, 151, 153, 164, 172, 177, 211, 233 urban sex ratios, 234 urbanisation, 43–4, 92, 97, 121, 144, 146, 148, 154, 157, 220–1, 224, 234, 249, 266 urbanisation level, 249 USAID, 22 USSR, 2–3, 107, 155, 218; see also Soviet Union, Russia

for housing costs, 135; see also low pay, labour markets Ward, Peter, 63, 149, 160 Washington Consensus, 163 Watson, Vanessa, 85 welfare state: cuts, 186–7 welfare subsidies, 134 wells, 55, 69 West Africa, 94–5, 97, 113 white minority regimes (southern Africa), xii, 20, 57, 110, 154, 160, 209, 217–19 Windhoek, 57, 113, 153 wood fuel, 69 worker dormitories, 1, 46, 211, 219, 235, 237 worker hostels, 20, 112, 220, 234, 237 workers’ earnings: falling in relation to national output, 262 workhouses, 132 World Bank, 24, 28, 91, 162, 170–2 World Wars, impact on housing policies, 73, 104–6, 108, 123–4, 126, 157 Wuhan, 211, 221

Vasudevan, Alex, 208 vehicles: used as accommodation, 206–7 Venezuela, 147

Zambia, xii, 21, 24, 32, 108, 239; see also Jesuit Centre for Theological Reflection ZANU (PF) (Zimbabwe African National Union (Patriotic Front)), 60 Zimbabwe, xii, 8, 20–5, 29, 40, 48, 57, 58–60, 70, 113, 151, 153, 156, 160–1, 165, 169, 223, 239, 267; demolitions, 69, 76; housing standards, 56 Zurich, 127

wages, 35, 40, 129–30, 134, 150, 164, 170, 188, 191–2, 219, 225, 228–9, 233, 235–6, 238, 249; in relation to rents, 36–8; median, 135; minimum, 37, 134–6, 170; minimum, insufficient

Xi’an, 220, 221 York, 18, 193

319