Affordable Housing Crisis and Global Solutions 2025

The global housing crisis has deepened in 2025. Homelessness and inadequate housing affect millions worldwide. The United Nations reports 300 million homeless people, expected to rise to 330 million by the end of 2025. Around 2.8 billion lack adequate housing. Climate change and disasters worsen this crisis. The UN-Habitat Assembly in Nairobi (May 2025) prioritised affordable housing as a human right and sustainable development goal. Innovative financing, public-private partnerships, and policy reforms are key to addressing this challenge.

Global Housing Shortage and Homelessness

Worldwide homelessness is rising across developed and developing nations. Cities like New York and Los Angeles have large homeless populations. Annual evictions reach 15 million globally, exacerbated by climate impacts. Adequate housing is essential for human dignity, safety, and social stability. The crisis varies by region but demands urgent coordinated action.

India’s Housing Situation and Challenges

India faces a severe housing shortage with 18 lakh homeless and 7.3 crore lacking decent housing. Urban population growth outpaces housing supply. Rural-urban migration leads to informal settlements and slums. Poverty, income inequality, and unemployment intensify the problem. Housing shortage obstructs economic growth and social inclusion.

Pradhan Mantri Awas Yojana (PMAY) Overview

India launched PMAY in 2015-16 to provide affordable housing by 2022, extended to 2025. It targets Economically Weaker Sections (EWS), Low Income Groups (LIG), and Middle Income Groups (MIG) in urban and rural areas. PMAY has four components – In-situ Slum Redevelopment, Credit Linked Subsidy Scheme, Affordable Housing Partnership, and Beneficiary Led Construction. Over 1 crore houses sanctioned, 96 lakh delivered. Uttar Pradesh leads implementation; Maharashtra and Andhra Pradesh lag.

Financial and Social Impact of PMAY

PMAY offers subsidised home loans reducing EMIs. Beneficiary-led construction supports landowners building homes. Private developers receive incentives under Affordable Housing Partnership. The scheme promotes women’s empowerment through joint ownership. It boosts employment in construction and allied sectors. PMAY influences housing markets by correcting prices and increasing supply, benefiting cities like Pune, Ahmedabad, and Hyderabad.

International Recognition and Lessons

PMAY is one of the largest affordable housing programmes globally. UN-Habitat, World Bank, and OECD commend its digital monitoring, subsidy design, and financial inclusion. It serves as a model for countries in Africa and Asia. The scheme’s success lies in system design preventing leakages and supporting demand-side needs. Global forums stress housing as key to social progress and sustainable development.

Future Directions and Global Cooperation

The international community must intensify efforts to ensure housing for all. Coordinated policies and innovative financing are essential. Social development summits show the need for secure, dignified housing. Lessons from PMAY and similar models can guide global housing reforms. Addressing homelessness requires sustained commitment from governments, private sector, and civil society.

Questions for UPSC:

1. Point out the socio-economic impacts of rural-urban migration on housing in developing countries with suitable examples.
2. Critically analyse the role of public-private partnerships in addressing affordable housing shortages in India and globally.
3. Estimate the effects of climate change on global homelessness and discuss mitigation strategies adopted by international organisations.
4. Underline the importance of digital infrastructure in welfare delivery systems and how it can reduce leakages, with reference to housing schemes.

Answer Hints:

1. Point out the socio-economic impacts of rural-urban migration on housing in developing countries with suitable examples.

1. Rural-urban migration increases urban population faster than housing supply, causing shortages.
2. Leads to growth of informal settlements and slums with inadequate living conditions.
3. Exacerbates poverty, unemployment, and income inequality in cities.
4. Strains urban infrastructure and public services, reducing quality of life.
5. Example – India’s urban areas face 52% of homeless due to migration-driven demand.
6. Migration driven by search for better livelihoods but results in marginalization without affordable housing.

2. Critically analyse the role of public-private partnerships in addressing affordable housing shortages in India and globally.

1. PPP mobilizes private sector efficiency and investment to complement public resources.
2. In India, PMAY’s Affordable Housing Partnership incentivizes private developers to build affordable units.
3. Helps increase housing supply, reducing prices and benefiting low and middle-income groups.
4. Challenges include aligning profit motives with affordability and ensuring quality standards.
5. Globally, PPPs enable innovative financing and risk-sharing, but require strong governance to prevent leakages.
6. Successful PPPs promote sustainable urban growth and social inclusion when well-regulated.

3. Estimate the effects of climate change on global homelessness and discuss mitigation strategies adopted by international organisations.

1. Climate change causes disasters (floods, storms, droughts) leading to forced evictions and displacement.
2. Increases annual global evictions (~15 million), worsening homelessness and housing insecurity.
3. Disproportionately affects vulnerable populations in developing countries and informal settlements.
4. UN-Habitat and World Bank promote climate-resilient housing and disaster risk reduction policies.
5. Strategies include integrating climate adaptation in housing plans and expanding social protection systems.
6. International cooperation focuses on sustainable development goals linking housing with environmental resilience.

4. Underline the importance of digital infrastructure in welfare delivery systems and how it can reduce leakages, with reference to housing schemes.

1. Digital tools enable real-time monitoring, transparency, and accountability in scheme implementation.
2. PMAY uses geo-tagging and digital tracking to prevent fund and resource leakages.
3. Direct Benefit Transfer (DBT) reduces intermediaries, ensuring subsidies reach beneficiaries directly.
4. Digital inclusion enhances financial access, supporting credit-linked subsidies and home loans.
5. System design using digital infrastructure builds trust and improves efficiency in public housing delivery.
6. Global bodies recognize digital welfare systems as best practice models for scalable, leak-proof delivery.