Financialization of Housing
We all learnt from our schooling days that Humans have three basic needs i.e. Food, Clothing and Shelter. We need all three of them to live a dignified life as a Human Being. Shelter or the Housing is a very important part of it so as to raise a family and thrive in the community. Unfortunately among the other three needs this is one that has been exploited the most recently to a massive extent causing homelessness, displacement and unaffordability.
The reasons for this unusual trend is because of “Speculative Investment”. This is caused because financial corporations and funds entry into Housing and Real Estate Sector as a way to make a staggering returns on the investments. In recent years the housing sector has been transformed by global financial actors and unprecedented amounts of excess capital. It is no longer as we once knew it. Housing has been financialized: valued as a commodity rather than a human dwelling, it is now a means to secure and accumulate wealth.
As it was anticipated that the free markets would take care of the prices based on the Supply and Demand cycle and there would be no need of external intervention. However, this objective fairly seems to be off the mark as Real Estate is no longer a way to have a modest place to live and raise a family, but rather an investment which is expected by the investors to grow over time. This Neoliberalism mindset has led to rise in the prices. However, like the crisis of 2008 this mindset might lead to formation of a bubble wherein the investors expect their investments to grow but might not always end up with same outcome.
Human Rights are sidetracked and neglected by the policy makers in the bid to attract foreign capital and investors. So a right balance needs to be drawn between this and it must be kept in mind that Housing is first an important part of one’s life and not just a commodity.
Especially in this critical times when the whole world is locked down because of the COVID-19 virus, the importance of a Home is more than ever. It is very crucial to have a personal space for an individual when most probably they would be working from Home or even when they are not working / layed off due to the Shutdown everyone needs a shelter to reside more than ever.
Affordable housing is something that has startled many because of the Initiatives taken by Governments in many parts of the world. This ensures that everyone has a shelter on their head. This is a really ambitious target and the UN expects to do achieve it by 2030.
In India the importance of having a Housing for all in this unprecedented times is a miracle. Soon to be the most populated country in the world with 1.3 billion people currently, and with its economy size, India is at a critical juncture for the protection of the right to adequate housing. Now is an opportune time to put in place long-term plans to address the country’s accelerated urbanization and population growth, and to ensure human dignity and rights for millions of people. India can and must tackle inequality, poverty and housing exclusion with the same conviction it places in its democratic values. The challenges are daunting: over 58.6 million households do not have access to adequate housing in urban and rural India, and there is an extensive need for repair of dilapidated housing stock and the provision of essential services such as electricity, water, sanitation and waste management.
Indian government has introduced an ambitious Housing for All Scheme, the aim of which is to build approximately 20 million houses in urban areas, potentially housing 100 million people by 2022. The goal is to address the housing needs of many of the urban poor, including those living in recognized informal settlements, which have the urgent need to be relocated to proper housing because of them living in subhuman conditions and are often made targets of the capital landlords who shift the whole slums for the sake of benefiting from the sale of Land to the Builder or an Investor.
But it’s not all negative, there are certain benefits of this Financialization regime. First, because of rising investment in Housing sector there is steady rise in Infrastructure development at a national scale. With its burgeoning population, there is a need to have more and more housing and to a certain extent Private sector has led to availability of more and more resources. Secondly, with the development coming in comes new Job opportunities in the form of hospitality industry, entertainment industry gaining more and more scope.
So it’s not just that Financialization has led to all the tragic outcomes. But when compared according to me having financialization of the Housing Market has rather more cons than pros. However, it needs to be tweaked with laws regarding Human Rights and regulations from the Governments so that it is ensured that housing remains more than just a commodity to the people.
