How do we solve the housing crisis in Pakistan?

Our current national housing predicament calls for an immediate implementation of an urban land reform plan

Recently, Prime Minister Imran Khan called for developing high-rise (vertical) buildings across the country. This policy, it has been reported, aims to address the housing crisis in Pakistan.

The PM further stated that avoiding unplanned settlements would ease the country’s urban housing problems; cautioning that arable land is presently being ‘eaten up’ by residential developments.

To address this issue, the government is formulating laws for constructing international-standard high-rise buildings.

So far, the major takeaways from the prime minister’s tweets (on this issue) have been:

  • High-rise buildings are the ‘constructions of the future’; ideal for replacing our current onslaught of congested, unplanned settlements.
  • Future cities will be vertical (expect skyscrapers to stud the nation’s skyline).
  • Green, plantation-dense, areas will be protected.

But the Pakistani premier is not the first individual to express concerns on the housing crisis currently in effect in the country. Greek urban planner Constantinos Doxiadis (credited with formulating Islamabad’s first Master Plan layout) did the same over six decades ago.

The Ayub government hired Doxiadis to design the new capital city in the early 60s. He was also tasked with renovating Karachi from its predominantly colonial era layout.

At the time, the Greek architect foresaw the unplanned growth of cities in the country. With premonitory insight, he recommended the government to develop a national housing and settlement plan to mitigate the advance of this threat early.

But his proposals, unfortunately, fell on deaf ears. And fast-forward to 2019, we, as a nation, seem to be entangled in the very yoke of the development issues he predicted.

History, after all, never has been much of an effective teacher in our corner of the globe.

The reasons behind this developmental quagmire

There are a series of factors that have added to the country's housing woes:

Rural-to-urban migration

According to the 2017 census, Pakistan's total population numbered approximately 207.7 million people. Of this total, 75.7 million of the country's citizens were found to live in the urban areas.

Developed cities offer vast economic opportunities. People residing in Lahore, Karachi, and Islamabad, for one, have always enjoyed access to better facilities. The lifestyle that these cities offer is often seen as ‘comfortable’ – if not flat-out luxurious by those in the one-percent.

For the residents of the country’s less-developed zones, migration to these sprawling metropolises is largely seen as the only plausible route to attaining a more desirable mode of existence.

Overall, these concerns have collectedly led to an unprecedented surge in rural-to-urban migration. And this trend is unlikely to abate anytime soon.

Demand and Supply gap

The migratory dynamic referenced above naturally creates a demand and supply gap. At present, the urban housing demand in Pakistan amounts to approximately 350,000 units per year. The corresponding supply of these amenities, which is 150,000 units per year, in no way bridges this gap.

Of the 350,000 units demand figure, 62% is accounted for by low-income groups. The lower-middle income demographic takes up a 25% share. The remaining 10%, on the other hand, is attributed by statisticians to the country’s higher and upper-middle income groups.

Pakistan also faces a backlog of over 8.5 million residential units. This figure is increasing by 200,000 units every year.

All in all, these issues paint a gloomy picture of urban housing for low and middle-income groups.

Successive governments (including the current one) have historically opted to create informal settlements, including slums and informal subdivisions of agricultural land (ISAL). But these do not constitute a permanent solution, by any means – only a temporary, and often politically motivated, fix.

In some quarters, these half-baked remedies are even blamed for having added to the country’s housing quandary.

Unplanned/illegal constructions

Last year, the Supreme Court ordered a sweeping operation to clear encroachments countrywide. It directed the authorities concerned to dismantle illegal structures in public areas. The task at hand, as anticipated at the time by every serious analyst, was daunting.

The operation targeting the Karachi Circular Railway (KCR) is a good example to illustrate the complexity of this endeavour. The area houses more than 25 settlements, comprised of more than 4,653 households. Without a proper resettlement plan in place, these families will be vulnerable to displacement.

Consider another example.

In November 2018, Sindh Chief Minister Murad Ali Shah shared details of the forest cover in the province. He complained that the land mafia had usurped up to hundreds of thousands of forest land for their illicit activities.

Of this land, Dadu district topped the list with at least 27,566 acres of seized area. In, Benazirabad, over 24,000 acres of forest land was reportedly under the mafia’s control.

On a somewhat similar front, the Rawalpindi Development Authority (RDA) identified at least 800 unauthorised constructions this year. Ninety-nine percent of the buildings standing in Quetta have also turned out to be illegal.

The ‘plot culture’

Real estate investors across the country consider plot ownership the most viable and safest investment choice. Even salaried individuals prefer buying plots over houses or apartments. A big reason behind this mode of investment-channelling concerns the existence of a number of outdated laws, faulty building regulations, and poor regulatory authority governance.

Plot transactions, however, are often undocumented, and this adds to the national burden imposed by the unregulated plot economy. As a result, property market prices are seen to increase. This makes housing a largely unaffordable venture for most genuine buyers (people interested in occupying a residential unit for the long haul, and not using it as a saleable commodity).

Working towards a Solution

There are several solutions to tackling the housing shortage problem in Pakistan. For this end, a good start for the PTI-led federal government would be to:

  • Ban slums and illegal settlements.
  • Focus on vertical growth for future cities.
  • Formulate effective building by-laws.
  • Revamp housing regulatory bodies.
  • Promote the concept of affordable housing through awareness campaigns.
  • Seek suggestions from developers, town planners and experts instead of corporate executives.
  • Encourage developers and start-ups engaged in providing low-cost houses.
  • Educate the public on building and house finance issues.
  • Discourage plot culture through taxation.
  • Identify the root-cause of the problem by establishing a three-way link between citizens, local regulatory bodies, and provincial governments. 

Multi-family housing projects: NPHP, Doxiadis, and the spatial perks of high-rises

In October 2018, the PM launched the ambitious Naya Pakistan Housing Programme (NPHP) project, an affordable housing scheme for low-income groups. Under this initiative, at least five million low-cost houses will be built countrywide in a phased manner.

Many property market gurus see NPHP as the first major step towards the provision of low-cost housing in Pakistan. Its goal - to provide houses to low-income groups on easy instalment plans – is certainly a laudable one. And as a further token of approval, these same experts believe that multi-family housing projects are the solution to the nation’s housing issues. Single-family houses, they claim, are not suitable from an urban planning perspective.

Islamabad’s ‘Five Elements’: a blueprint for future developments?

Coming back to Doxiadis, the celebrated town planner had considered both economic and sociological factors while developing Islamabad. His master plan had taken careful note of five construction elements. These, namely, were:

  • Buildings and Structures,
  • Nature,
  • People (the Individual),
  • Society (the Collective – and the humanistic trends begotten), and
  • Network (the intuitive fluidity of intra-city connection/communication)

The architectural wiz saw cities as ‘living organisms’ – and considered a range of life disciplines, ranging from socioeconomics and political theory, as fundamental to their humanistic viability. A good developmental rubric, perhaps, for devising the blueprints of our planned housing developments.

Urban developers say that multi-storeyed buildings are more spacious. These structures, by their design, can accommodate more apartments as compared to a few plots carved out on the same land.

In practical terms, a five-storeyed building measuring only four kanals is spacious enough to host approximately 40 apartments. In the parallel case, only five 10-marla plots can be carved out on the same land area. And to extend the example further, the former project would cost approximately PKR 300 million to be completed within a timeframe of five months.

The employment opportunities generated through such a venture – for at least 300 people, as per intelligent estimates – also merit consideration.

The government, in a flurry of seemingly-wise decision making, has presently reached out to the private sector for help in completing the NPHP project. This collaboration would likely reduce the developmental burden on a single stakeholder. Moreover, the authorities concerned would be able to complete the project in an efficient manner. The government has also asked philanthropists and businessmen to provide financial resources for NPHP’s early realisation.

My ‘Two Cents’ directed towards the State (policy makers take note)

To keep its construction furnaces burning (for which the fuel of ‘popular approval’ factors as a combustion-necessity), the state needs to incentivise any project that aims to provide affordable housing.

For starters, it can do so by providing tax exemptions, and other related facilities, to the stakeholders involved in the developmental workflow. Recently, ABAD extended its support to the government for constructing low-cost houses as well as new cities; in a bid to tackle the nation’s housing shortfall.

At the moment, several start-ups are also offering their expertise (in a private capacity) to address this problem.

ModulusTech is a Karachi-based start-up which builds customised houses for its clients. Its units (up for sale) comprise one-room apartments that can be assembled in a mere three hours’ timeslot. The company’s standard 256-square feet model costs approximately PKR 300,000 per unit.

Similarly, promoting affordable housing and discouraging plot culture should be taken as the need of the hour – a ‘nation building’ measure which the authorities must pursue with consistency.

The plot-making developers’ monopoly, for one, may be dis-incentivised through careful taxation. This prescription would trigger constructions on idle plots. The government can then penalise the wily speculators, through the varied legal means at its disposal, who still choose to resort to the practice.

There is also a need to revisit laws that regulate suburban plot formation. A beneficial corollary of this measure may take the shape of ordinary citizens choosing to take rental yield as the primary source of their income.

As per reports, the government is currently mulling over options to repurpose the country’s historic building developments. And this is good news, since many structures built during the colonial era are currently standing in a very dilapidated condition. A good suggestion would be to renovate these buildings, and convert them to premium housing facilities.

Moreover, the use of agricultural land for commercial and residential purpose should be banned.

The Concerns of Genuine Buyers and the Low-Income Group

But what about the genuine buyers who are at the receiving-end of Pakistan’s urban housing crisis? These ordinary citizens can hardly afford any additional utility. They work hard for food, clothing, and education. Many struggle with paying their rents, and owning a house is largely seen as an impossibility – given the meagre monetary resources at their disposal.

In its mini-budget presented in January, the federal government announced a 19% income tax rebate on the revenue generated from loans given for low-income housing, small businesses, and agricultural projects. It also proposed an interest-free revolving credit (Qarz-e-Husna) worth PKR 5 billion to fund the construction of low-cost houses.

These measures help – both in concrete and sentimental terms.

A Final Word

Our current national housing predicament calls for an immediate implementation of an urban land reform plan. This needs to include a complete revamping of the government departments concerned, such as the House Building Finance Company (HBFC) and the civic agencies covered under the umbrella of the Lahore Development Authority (LDA). And to usher in further noticeable improvements on this front, the government should allocate more funds in its upcoming budget for the housing and construction department - if it is, indeed, serious about realising its objective of providing affordable housing.

Lastly, there is a need to consult the common citizen on the exact nature of their housing concerns. For this purpose, the government may partner with community-based groups and local bodies in order to have a more clear understanding of the issues at hand.

Also, community-based programmes should be launched to apprise the general public about the importance of investing in apartments and houses. For this end, workshops can be conducted to teach ordinary citizens regarding the steps to take for applying for affordable housing.

With the right set of intentions, and corresponding work put in, there is potential for much good in this country.

Manik Aftab

The writer is a real estate analyst at

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