Commentary

Habitat III must rethink the role of housing in sustainable urbanization

Thinking differently about housing offers a key tool to generate new social arrangements, transform city landscapes in ways that fashion a more vibrant urbanism, and create new possibilities for urban value creation.

Artists spent some 14 months painting the fronts of 209 houses in Las Palmitas neighbourhood of Pachuca, in Mexico's Hidalgo state, to create the largest mural in the country. Next year's Habitat III conference offers an opportunity to see housing as a key component in creating urban value. (Javier Lira/Xinhua /Landov)

Economists, sociologists and political scientists have long theorized a positive relationship between the growth of cities and national economic development. But the contemporary experience in many emerging economies suggests that we need to rethink these assumptions.

Next year’s Habitat III conference and the current process to define its 20-year urbanization strategy, the New Urban Agenda, offer an important opportunity to do so. In this, Mexico is a  strong case study, and its experience overlaps significantly with that of other countries in Latin America and beyond.

Mexico faces a wide array of challenges associated with recent urbanization patterns, in which city boundaries are being extended through the mass production of housing. Housing-led sprawl has not only produced growing demands for public investment in urban services that are straining local and national budgets, it also has undermined environmental sustainability.

[See: Connecting housing with sustainable urbanization in the New Urban Agenda]

One reason Mexico faces these problems is because many housing promoters, in both the public and private sector, have been working under the assumption that the accelerated production of housing strengthens the country’s overall economic development. But we must wonder if the costs associated with these building strategies may actually be undermining overall prosperity gains for individuals, cities and the nation alike.

Together these trends suggest a paradox. As countries like Mexico begin to enter the ranks of middle-income economies, at least as measured by gross domestic product per capita, they are adopting consumption patterns that are more similar to those of the United States and Europe, particularly with respect to housing and other services. Yet these changes are occurring at the same time as questions of environmental degradation are on the social agenda and energy futures are being called into question — with some beginning to argue that such consumption patterns are unsustainable.

To be sure, Latin American countries like Mexico and Brazil do not have the high rates of carbon emissions of the United States and other advanced economies. But Mexico’s rates, particularly in its urban centres, rival those of cities like New York, and without having the same per capita income. All this suggests that something else is clearly driving these aggregate statistics, and one of those factors is the way we are building the Latin American city.

[See: Sustainable cities: Key to future development and governance]

This should raise warning bells: Not enough attention is being given to “densification” and the housing types, locational decisions and infrastructural investments that can keep cities compact and more energy efficient.

Shunted to the periphery

Why is this happening, despite experts agreeing that such concerns are a key to future sustainability? One reason is the strong partisan forces behind the embrace of outward expansion.

“Not enough attention is being given to ‘densification’ and to the housing types, locational decisions and infrastructural investments that can keep cities compact and more energy efficient.”

Some of these approaches are being driven by political and economic elites who benefit from these urban patterns. Although economic neo-liberalization and decentralization of authority may create new opportunities for urban investments at the local level, it also privileged the role of private developers and the housing industry while also transferring responsibility for housing permits and the provision of critical urban services to smaller municipalities.

Yet these entities often are not equipped to provide regulatory oversight, even as they also remain fiscally dependent on transfers from higher levels of government to serve basic needs. This is particularly true for the municipalities that ring the outskirts of established cities. As a consequence, many authorities in these locations accommodate housing developers’ desires to build housing in exchange for tax revenues or the provision of rudimentary infrastructure. These bargains help buttress municipal budgets, but they also tend to increase sprawl and the ever-expanding urban footprint.

[See: In Latin America, housing advocates set their sights on Habitat III]

To be sure, many countries, including Mexico, are mounting new national programs and exploring alternative policy incentives to find solutions to those problems, so as to generate denser cities and encourage verticality while still letting the private sector take a lead in housing production. But seen from the perspective of the locality, it is very hard to balance the aims of sustainability with the logic of private land markets.

In Mexico, there are relatively few available lots in well-serviced areas of the city, while high land costs in central areas make developers unwilling to try to build affordable housing in denser locations. This is why mass producers of housing usually select peripheral locations.

Yet these are the areas that are likely to lack good transport connectivity or sufficient municipal services. And neither developers nor municipal authorities are eager to pay for the infrastructure that would make these areas liveable, let alone sustainable, particularly in the case of public transportation.

All this means that many of those families who end up in these developments may at first think they are going to benefit by finally purchasing their own home. But instead, many continue to suffer — as does the rest of the urban citizenry — because these areas end up being both isolated and under-serviced. Further, they continue to live in areas where the daily quality of life may cancel out the psychological and personal gains associated with home ownership.

This underscores a second paradox. One reason the Mexican government has been willing to embrace an expanded social housing programme is that it holds the potential to provide jobs in the construction industry and help grease the wheels of the economy. But the social problems and mortgage failures that increasingly result from housing’s location in the far periphery of the city have themselves become a drain on the economy.

Creating urban value

During the decades of the 1970s and 1980s many scholars argued that “over-urbanization” held the potential to stifle a more vibrant economic prosperity. We must be mindful of these legacies when we look toward the future. Current urbanization patterns hold the potential to be financially and environmentally unsustainable. If we fail to build dense cities, future generations will suffer.

“In Mexico, the social problems and mortgage failures that increasingly result from housing’s location in the far periphery of the city have themselves become a drain on the economy.”

A key challenge for the New Urban Agenda, then, is to find new ways to channel housing investments in the service of sustainable urbanization. Yet how is this to be done?

[See: UN-Habitat’s vision of sustainable urbanization is good — but not enough]

First and foremost, involving urban planners in the monitoring and regulation of housing production would make it more likely that housing decisions are connected to existent infrastructure in ways that help create more efficient and sustainable urbanism. Planned, compact and dense housing will reinforce efficient arrangements that, in turn, can reduce initial capital investments in infrastructure as well as operating and maintenance costs. Such decisions will go a long way in laying the economic groundwork for wise housing investments, which can be defined as investments that create urban value, not merely housing value.

Urban value is generated when the economic, social and lifestyle gains associated with investment in housing accrue to the larger neighbourhood and even city as a whole, and not merely to the individual buyer or seller of the house. Producing such value requires trained professionals with the willingness and capacity to assess the context and location of housing construction, not merely its construction and mortgage costs.

Order of investments

Yet just as important, achieving these aims also requires new ways of thinking and acting. Politicians as well as housing and urban development professionals must be willing to undertake the necessary steps to reverse the ordering of investment priorities. Rather than giving the green light to more housing and then struggling to ensure that this is followed by transportation and social infrastructure, government agencies at all levels must prioritize infrastructural investments in ways that connect housing production and supply to create socially vibrant and well-connected environments.

[See: A towering challenge: Habitat III must promote municipal fiscal health]

Of course, this is easier said than done. This unfortunate “backwards” logic has a long history in Latin America, owing to the growth of informal settlements that forced authorities to retroactively try to remediate infrastructure gaps generated by the proliferation of self-built housing. Surprisingly, however, the same logic prevails even when it comes to formal housing.

“A key challenge for the New Urban Agenda is to find new ways to channel housing investments in the service of sustainable urbanization.”

Some of this owes to the fragmented organizational logic of governance in the urban sector. Federal, state and local agencies are often institutionally divorced from each other, particularly with respect to the production, monitoring and financing of housing. The sector is riddled with competing and overlapping agencies with mandates to focus on either housing or urban infrastructure and land use, but rarely on both domains simultaneously.

Changing these fragmented relationships is a priority if infrastructural development is going to guide rather than respond to housing production, and cities are going to be built more sustainably. The process toward next year’s Habitat III conference offers a key opportunity to jump-start that conversation at the national and global levels.

House as subject

Yet because institutional reforms of this magnitude are long-term goals that will be politically controversial and can take decades, urban planners must also be prepared to look elsewhere for new thinking that can make a difference in the shorter term. In particular, those who care about cities and national economic prosperity must work together to make progress on changing the way urban planners, developers and construction industry professionals think about housing.

Most have been trained to consider housing as an object — for instance, as shelter that protects against the elements. Yet some of the most inspired housing experiments have been produced by those who think of the house as a subject: conceived as a physical construct capable of generating new social arrangements, transforming city landscapes in ways that fashion a more vibrant urbanism and thus the creation of new possibilities for urban value creation.

[See: Can the New Urban Agenda spark the local action needed?]

One way to do this is to see housing in light of its potential to create social and economic value. For good or bad, all housing structures the lives of its inhabitants, while also establishing how they are either isolated or integrated with other city dwellers. Acknowledging that the boundaries separating activities within and outside the house are permeable and at times artificially constructed will go a long way toward liberating a wide array of professionals from treating housing as just an object.

Armed with the realization that housing serves as a foundational element in the production of better urbanism and a more vibrant social and economic environment, the task at hand is to focus more explicitly on housing’s potential to stimulate and structure sustainable urban economies  — and to ask what new social, spatial, and economic values and relationships a given housing investment will produce, at what scale and with what impacts on the future of cities.

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Diane E. Davis

Diane E. Davis is the Charles Dyer Norton Professor of Regional Planning and Urbanism at the Department of Urban Planning and Design, Harvard Graduate School of Design.