Conference Proceedings : “JANASEVANA” National ... - UN HABITAT

Any investment in housing has an effect on the national income of a country that goes beyond the direct
investment itself. This is measured by an investment multiplier, the ratio of the change in national income
to the initial change in the sectoral investment.
Economic Perspective of Social Housing in Sri Lanka
Dr. Ranjith Bandara, Senior Lecturer, Department of Economics, University of Colombo and
Chairman, Sri Lanka Foundation Institute
Social housing is an umbrella term referring to rental housing which may be owned and managed by the state, by nonprofit
organizations, or by a combination of the two, usually with the aim of providing affordable housing. It can also
be seen as a potential remedy to address housing inequality.
Three broad approaches on social housing ‐‐ classified by Amzallag and Taffin (2003)
• Institutional approach: Social rentals are owned and managed by social landlords (e.g. Municipal bodies, nonprofit
corporations or associations), legally endorsed task to provide affordable dwellings;
• Public assistance approach: Rentals are social whenever they get preferential land assignments, subsidies or
tax allowances or public guarantees, mostly tied to rent regulation, means testing, profit constraints;
• Household resources approach: Social rentals are defined as “below market rent” dwellings, open to
households who cannot satisfy their housing needs on a free market.
In South Asia, although high‐income groups do not face issues of housing shortages, they are a major cause for
concern among middle and low‐income groups. This is the result of rapid population growth, increased urbanization,
high income inequality, and displacement of people due to natural disasters and conflict. Large‐scale slums and
informal settlements that prevail in almost all South Asian countries underline the urgency of meeting the demand for
homes. There is a shortage of more than 38 Mn housing units in the region, not counting housing needs of repair or
replacement. Taking into account the average household size, this translates to 212.5 Mn homeless people, which
amounts to 14% of a total region’s population of 1.5 Bn. According to World Development Indicators of 2009, a
Conference Proceedings – National Housing Symposium 8