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The KPDA Bulletin - January to July 2020 Issue

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J A N U A R Y T O J U L Y 2 0 2 0

Affordable Housing Can

Become a Reality for

Cities

By the World Economic Forum

Cities are growing at an unprecedented rate, presenting an

incredible opportunity for the development of local economies.

However, their residents need good, affordable housing – and

this remains a challenge around the world. Well-functioning

property markets can act as a financial springboard for

enterprises and job creation. An enabling environment for

affordable housing can be developed with the right

infrastructure, investment and macroeconomic policies targeted

towards social and financial inclusion.

Affordability – Exploring the Problem

The challenge of affordability requires not just short-term fixes

but also long-term strategies. Solutions will need to address both

the supply side and the demand side of the housing market, and

involve public-sector, private-sector and non-profit

stakeholders.

It is not only about being able to

afford to buy or rent a house, but

also being able to afford to live in

it. This goes beyond meeting

expenses related to operations

and maintenance; it also involves

considerations of transport,

infrastructure and services. If a

house is cheap enough to buy and

run, but located far from

livelihood opportunities or

amenities such as schools, it

cannot be said to be affordable.

The reasons for a lack of

affordability vary from city to

city, but commonly include

housing costs rising faster than

incomes, supply of houses not

keeping up with demand, scarcity

of land, and demographic changes

such as population growth, ageing

and changes in household

composition.

Supply-Side Challenge 2: Land

Use

City governments generally use

two tools – zoning and regulation

– to shape where and how new

houses can be built.

Consideration

is given to:

- Transit-oriented development,

in which expansion of cities is

planned around new urban

transport infrastructure.

- Algorithmic zoning, with

incentives for developers based

on assessment

of what is needed to maximize the

vibrancy of a community.

-

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