The Role of Public-Private Cooperation in Urban Housing Development

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Jan 16, 2009
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Housing has become one of the most complex problems for a large number of people. The housing conditions in the urban areas have been deteriorating fast mainly due to the unprecedented growth of population caused by large-scale immigration from the rural areas, low rate of new housing construction activities and above all the inability of low-income families to afford high rents and higher cost involved in housing construction.

As a result, slums and squatter settlements have mushroomed in the city centers, unauthorized housing colonies are cropping up in large numbers and the homeless population has increased in number rather considerably. Also on account of inadequate land spaces or the total absence of essential housing services, the environmental conditions in urban habitations and other areas have been degrading continuously. Congestion and overcrowding in urban centers are now more common.

In cities like Cochin apartments are becoming popular mainly due to better private-public coordination for solving the housing problem. Such a partnership has already led to major developments in the city. The infrastructure projects are also witnessing wider involvement of the private sector. Consider the Nedumbassery International Airport project. The state government could not find the necessary funds required to develop this mega project. The land acquisition proceedings were rather costly and the shortage of funds held up faster developments.

The leading management experts suggested a way out and it was implemented as such. Through issuing public bonds, the necessary finances were amassed in record time. Many other states and cities are now trying to imitate this model of development. Thus those areas also are likely to witness greater developments. People investing in such bonds will receive the returns on investment when the project starts generating sufficient income and is able to break even. The only drawback is that such projects take much time to get completed.
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