Self-construction: a bottom-up answer to low income housing

Rakhi Mehra, micro Home Solutions, Mumbai Guest ContributorRakhi Mehra, micro Home Solutions, Mumbai Guest Contributor

This is part one of a two-part post on the self-construction housing opportunity in India's slum areas. This first part highlights the need to acknowledge and facilitate the self-construction market and shares experiences from the mHS pilot; the second part will examine innovations needed to address issues of safety and quality in self-constructed housing, and what we can do to make innovations and information more accessible to communities.

The self-construction phenomenon: An urgent need for catalysis

Self-construction is a phenomenon that is visible across Indian cities and towns. Over 60 percent of India's urban poor live in settlements where units have been self-constructed. This trend is true for megacities such as Delhi and Mumbai, and probably truer for smaller-tiered cities such as Jaipur, Ahmedabad, and Dehradun. Contrary to popular belief, these settlements are not all 'slums' as seen near railway stations or near large drains, but a range of neighborhoods, including urban villages, unauthorized and planned colonies that vary both in terms of their legal status (right to sell, build, mortgage) and access to urban infrastructure and services.

In the absence of scalable private and government housing initiatives, these low-income neighborhoods are the largest 'suppliers' of affordable housing for the country's poor. Rather than considering these settlements as a problem that needs to be redeveloped, at mHS we see them as a solution to the country's growing shelter needs. Thus, if catalyzed and adequately facilitated, self-construction can be an efficient, bottom-up answer to the housing needs of India's urban poor.

What do we really mean by self-construction? Self-construction, often known as "incremental housing," "self-build," and "home improvement," is a process in which the homeowner is closely involved in every aspect of building, extending, or refurbishing his or her unit by undertaking the building work themselves or by contracting a mason under close supervision. Since access to mortgage loans is next to impossible for a number of reasons (lack of legal title, informal workforce, and so on), homeowners finance the construction through savings, borrowing from friends and family, or moneylenders, the latter invariably obtained at exorbitant rates. Also, the informality means that there are no building bylaws or plans, and thus no felt need to consult an engineer or an architect. The construction is influenced by the mason and neighbors, and based on informal, and often faulty, knowledge of construction practices. Self-constructed neighborhoods, therefore, are often lacking in terms of the structural safety of structures, and building collapses are common. Moreover, the lack of professional input on construction practices, such as sufficient light and ventilation, also has a direct impact on the health of dwellers. Introducing technical assistance, mason training, and advice to low-income informal neighborhoods would catalyze this self-construction market.

The Mangolpuri pilot

Shobha is a government employee who works as a cleaner with the Municipality of Delhi. In 1976, her father-in-law received a (7x3mt.) plot on a 99-year lease in Delhi's Mangolpuri resettlement colony, a site and services scheme, as compensation during the slum rehabilitation drive of the 1970s in the city. Oddly, the official document permits construction of a temporary structure with no right to mortgage or sell.

Over 20,000 families were given a plot in this settlement, 40 kilometers outside the center of Delhi. In 2012, the reality is that Mangolpuri is a highly dense, fully built-up neighborhood, providing housing and affordable rentals to over 150,000 residents. After 20 years of isolation, the city has expanded and encircled Mangolpuri, which is now well connected by metro, serviced by amenities such as hospitals and schools, and is a bustling economic center.

Since 2009, mHS has been analyzing the self-construction and incremental housing segment through studies and pilot projects. The first pilot, undertaken in Mangolpuri, was in collaboration with BASIX-BSFL [pdf], a micro-finance agency, and supported by the Michael and Susan Dell Foundation. BASIX provided construction loans to households (based on third-party guarantors) and made it mandatory for customers to avail themselves of technical construction assistance to address the problem of quality and safety at an affordable fee.

mHS facilitated the community workshops and worked with Shobha and 11 other low-income clients' suggestions on improving lighting and ventilation in homes, designing spaces, providing cost estimates, and drafting architectural and engineering drawings, as well as providing on-site consultancy to masons building these homes.

Shobha wanted to upgrade her ground floor structure into a "ground + 2" home, primarily to accommodate her two sons who would marry and continue living in the house with their families. Especially given the dilapidated state of her old home, Shobha wanted her new house to be "beautiful" and "different." While the money ran out before the upper floors could be completed (her son insisted on marble flooring), Shobha was proud that her new home was structurally sound and better-designed, and especially proud of its sparkling marble floor!

The pilot in Mangolpuri left no doubts about the tremendous opportunity that exists in impacting self-construction. However, it also demonstrated that low-income households often have varying priorities, need considerable hand-holding to take tough decisions, and are easily influenced by masons, extended family, and friends. Therefore, solutions must address community aspirations and dynamics. Also, several obstacles lay in the inefficiencies of the supply chain, the lack of space to store material, and the inability of low-income households to negotiate price and quality. Could material suppliers, such as cement companies, play a role in addressing the self-construction challenge as they have done in other countries, notably in Brazil's Reforma Mais program?

Another mammoth challenge is finance to build. Could the intervention also assist these households to access cheaper finance? Bit by bit, finance institutions, especially those with experience in the microfinance segment, are beginning to innovate in order to serve this challenging yet large market.

Policy vacuum for self-construction

Clearly, the urban poor desire and deserve professional assistance so that they can meet their aspirations for better housing and an improved quality of life. The Mangolpuri pilot demonstrated the immense desire for upward mobility and improved living conditions, as demonstrated by the fact that poor families in these settlements are spending their life savings on building and improving their homes. However, the pilot also highlighted that safety is not always a top concern for poor households, primarily due to lack of awareness.

There is an opportunity here, but one that has not yet been sufficiently recognized. Among the government's several social schemes, including Rajiv Awas Yojana, none have focused on the self-construction market. There has been no significant funding available (to train masons, for instance), nor has there been a facilitating environment created to develop this sector and really tap its potential to be a significant supplier of quality affordable housing. In fact, the only action has been the circulation of disaster management guidelines (National Disaster Management Agency [pdf]) through NHB (National Housing Bank) to housing finance institutions with a view to influencing safety. While these highlight the catastrophic risks, requiring housing plan approval will stifle, not facilitate, the self- construction industry (more on this in our next post).

In order to catalyze the self-construction market — which can be the bottom-up answer to housing for growing towns and cities — we need a multi-pronged approach. This involves issuing policy directives, and adoption of these directives by local governments, including rationalization of building codes for such neighborhoods. Moreover, we need non-government organizations such as social entrepreneurs, NGOs, and especially the private sector to take the initiative with models that offer alternative products, materials, and services, and raise awareness across stakeholders so that self-constructed homes can remain affordable, be safer, and offer a better quality of life.

The second part of this two-part post, entitled "Self-construction opportunity: enabling safe and quality construction," will give details on the technical and safety innovations that must be addressed in self-construction, the NDMA guideline requirements, and the new thinking on making information more accessible to these communities engaged in self-construction.

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