The second in Lingnan University’ new China and Regional Studies Webinar Series looked at the ongoing issues around the cost and availability of formal urban housing in both India and Hong Kong, and the consequent challenges of eradicating informal, or slum, alternatives. The speakers were Professor Darshini Mahadevia, Associate Dean of Arts at India’s Ahmedabad University, and Simon Yau Yung, Professor of Urban Studies in Lingnan’s Department of Sociology and Social Policy.
A remedy for state and market failures in India
Around 530 million people, or about 38 percent of India’s population of 1.4 billion, live in the nation’s urban areas. Despite offering a potential escape route from rural poverty, the rate of growth in urbanisation over the last two to three decades has been running at around 2.8% per annum, much slower than in China, and this growth has remained localised. In China urban population growth is driven primarily by internal migration, backed by government policy measures, whereas in India most of the increase is due to a high birth rate and the conversion of villages into cities in census data.
Formal housing is outside the reach of nearly half the households in India’s major cities, Prof Mahadevia explained. About 24 percent of the urban population were living in inadequate housing in 2012, and, according to the 2011 census, just under 17 percent were then living in slum dwellings that were illegal and could be demolished at any time. Since then the slum population has been growing at about twice the rate of the overall urban population.
The informal housing that is constructed by developers is often built on private land with no reliable access to basic services. With private capital uninterested in investing in formal housing for the low-income sector, the state’s efforts to intervene have also been strikingly unsuccessful. While public housing rents are subsided by government, conditions in these units are frequently not much better than in informal housing. What’s more, progress in expanding the public housing stock has been very slow. The number of units is currently increasing at around 0.22 million per year, but the last time the overall shortfall was calculated, in 2012, it stood at 18.8 million. At the present rate of completion it will take 100 years for supply to match demand.
Prof Mahadevia believes the way forward lies in implementing JFC Turner’s ideas on ‘incremental’ housing. ”Wherever there are slums, we could work on gradually improving them in an incremental manner and, finally, legalising them,” she said.
This pathway would take this housing from squatter settlements, to temporary or pavement dwellings, to slums with de facto tenure, and, finally, to upgraded, legalised slums.
Land shortage leaves SDU upgrades as Hong Kong’s best solution
Prof Yau began by tracing the history of informal settlements in Hong Kong. Despite a massive public rental housing construction programme that began in the 1950s, said to be prompted by a particularly large fire in one of the city’s squatter areas, informal housing in Hong Kong has never been eliminated. “In the early 60s, about one quarter of the population lived in squatter areas,” Prof Yau said.
In the 1980s, the horizontal growth of slums was increasingly replaced by vertical slums, consisted of tiny caged homes and cubicle units, within multi-storey blocks, as well as illegal rooftop housing. Today we have the phenomena of subdivided units (SDUs), which are not only extremely cramped but often also have fire safety, structural stability and environmental hygiene issues.
Despite government measures that have been implemented since 2012 to regulate SDUs, the number of such units increased by 50 percent between 2013 and 2020. Landlords of these units have strong financial incentives to continue with this business model. Research findings from November 2021 revealed the total rent received from a divided unit was twice as high as that of the complete unit.
In 2016, around 42 percent of households living in SDUs were waiting for public rental housing and had no affordable alternative. While 12 percent of SDU residents – including recent immigrants, refugees and asylum seekers – were ineligible for public rental housing. The average time eligible applicants had to wait to be allocated housing increased from 2.6 years in 2011/12 to 5.5 years in 2018, and has only increased since.
While Prof Yau advocated the use of data analytics to identify breaches of government regulations, he pointed out that forced evictions from SDUs could leave huge numbers of people homeless.
“Breaking the supply-demand imbalance is the ultimate solution,” he said. However, the shortage of land in Hong Kong meant that it was going to be impossible to replace the city’s SDUs with sufficient formal housing for some time.
Prof Yau, therefore, recommended a similar approach to that advocated by Prof Mahadevia. Residents should be helped to improve their living conditions. Greater size, construction and maintenance, standards needed to be set and enforced for SDUs, and an effective way found to control rents and curb the creation of new such units.