A Huge Social Problem...

HOUSING  COSTS  PUT  SQUEEZE  ON  CITY  DWELLERS .

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City dwellers around the world pay $650 bn more in housing costs than they can afford yearly , as rapid urban growth meets a constrained supply , according to a report .

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Some o the world's leading urban areas face the biggest housing cost problems , with New York , Tokyo and London among the worst affected , the McKinsey Global Institution said .

Beijing , Sao Paulo and Buenos Aires are among those facing the biggest crunch among lower income cities .

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McKinsey looked at the cost of housing as a proportion of household income , showing the extent to which a city's residents face financial pressure .

For the first time in history , more than half's the world population lives in urban areas and the proportion is set to rise to two-thirds by 2050 , according to the UN .

   

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Housing affordability has become "a huge social and economic issue affecting billions ", said Jan Mischke , a senior executive at  McKinsey . " More and more cities are growing fast , they are quite likely competing for talent and workers " .

Around the world , 330 m urban households lack decent

housing  or ate cutting back on basic spending to cover their

housing costs .

By 2025 , this number will grow to 440m - a third of the world's urban population - unless governments do more to build and   subsidise housing .

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The study recommends reducing building and maintenance

costs and cutting the cost of finance for both home buyers and housing developers .

Governments should also do more to free up sites for development , with land costs in leading global cities accounting for up to 60% of the cost of building a home , according to Mr. Minscke . " Land markets tend to be government controlled , either directly - for ex. Singapore - or as in London and New York where the government is  a significant land owner and the prime actor in regulating land use .Some cities are taking steps to reduce housing costs , and N.York mayor Bill de Blasio's plan to build 200,000 homes in the next decade goes next to Germany's system of rent controls .

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Cities like London and N.York  were victims of their own success. These cities are under significant pressure because they are engine rooms for growth .

Cities cannot survive unless they have adequate provision for key workers like teachers , nurses , bus drivers and cleaners to live within commuting distance of their work  !!

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