Home Sweet Home
Real issue is quantity of ownership not quality of housing
Published
Thursday 29th January, 2004
How is our nation housed? Is our housing of adequate quality and
quantity? Is it reasonable to expect present State Housing policies to
produce an improvement in the areas of shortfall?
In terms of tenure, there are 3 types of housing in our country -
owner-occupied, rented and of course, those persons who occupy land
without the owner's permission, sometimes called squatters. We earlier
referred to the squatting community as comprising an estimated 25% of
the national whole and this proportion itself seems proof that the
existing 'legitimate' housing market of homes for rent and sale is not
working properly. Can we truly be on the path to 'developing nation
status' if so many of our fellow citizens are unable to rent or buy
their own homes? Is this the way we want it to be? What can we do to
start improving that position?
Of course, one has to have a particular outlook in order to declare
that a market is functioning in an inefficient fashion. It seems to be
accepted, almost without question, that the more people owning their own
home, the better the nation is doing. This is not necessarily the case
since some of the most developed countries in the world have relatively
low proportions of home-ownership and some very poor nations have a high
incidence of home ownership. Rather than mode of ownership, the real
issues seem to be the quality of housing and of course, the ability to
move within the market. Mobility is key in a modern society, which
places such a premium on the degree of choices the individual can
exercise.
What is the standard and price of accommodation available to the new
entrant to the job market? Is there adequate provision for elderly
people in either the rented or for-sale market? How are our poorer
citizens to be housed? If this is not properly addressed, we can expect
a further expansion in squatting with consequent environmental
degradation as well as the social fallout from widening inequality.
The long-time value systems, which provided a place for poor
relatives in the homes of the better-off ones or older family with the
younger generation is by and large finished. We are not claiming that
those practices were perfect, but when we consider the limited resources
available here say 50 years ago, they did allow a degree of mobility and
possibility. The nation is today far wealthier and yet the evaporation
of those practices has created new challenges as to how we house
ourselves. How can we make best use of our resources to meet these?
Some of the critical policy initiatives would include -
-
Squatting - It has been established that the most
significant source of wealth in most developing countries is the
owner-occupied home. This seems to be a fairly obvious conclusion,
given the relatively undeveloped state of the stock/investment
market in societies like ours, but it is also true that a large
amount of capital is trapped in properties without proper title
since the owners cannot raise a loan on the value of their homes.
Indeed, one could even argue that with no title the property is
'valueless'. The point is that proper title is essential in
releasing value. We have also been recently reminded that our oil
and gas resources have a finite life; reliable estimates are that
peak production would be over within the next 20 years. If we are to
survive as a viable society it is essential that we spawn small,
viable non-oil businesses. Of course, readers of this section of the
Guardian will be aware of the importance of the cost of capital in
the success of a business. Squatter regularization, undertaken with
the necessary infrastructural work, can create a source of cheap
capital to seed the new generation of businesses the entire nation
needs.
-
Rentals - The State policy on rented housing is unclear
since there is little evidence of new units for rent being built and
the existing rent control policy is badly outdated. Given the
tendency towards new mega-projects and the lack of glamour attached
to maintenance, it is understandable that the State has little
appetite for building homes for rent, but there are other ways to
support the provision of rented housing. Who is building decent
housing for rent? Who can afford these? There do exist charities and
religious bodies, such as the Salvation Army or the Anglican Church,
which provide housing for homeless and elderly people without any
financial support from the State. These bodies have the experience
and credibility to provide a quality service to the needy and with
real public/private partnership, there can be a significant
expansion in the numbers of people housed for a relatively modest
input of State funds.
-
Owner-Occupied housing - There is a series of State
policies to boost this part of the housing market and these have
involved a number of choices as to which parts of the market receive
support. As mentioned above, there is an implicit assumption that
this is healthy and this has in fact propelled policy formation in
this area for some time.
The next article in this series will examine the State policies on
the financing of Owner-occupied housing and the effect of these on the
entire market. |
| How is our nation housed?
Is our housing of adequate quality and
quantity?
Is it reasonable to expect present State
Housing policies to produce an improvement in the areas of
shortfall? |
|
