Pakistani Government can easily build 5 Million Homes
Pakistan is facing the severe shortage of housing that has crossed 10 million mark. There is need to build 1 million homes every year but we are building just 200,000 units. The new government promised in the election campaign to build 5 million affordable homes. Many people think that it is impossible to build 5 million homes. This blog describes that Pakistani government can easily build 5 million homes.
Total money Pakistan needs to build 5 million homes
The construction cost of an affordable home of 2 bedrooms is USD 10,000 worldwide. This is because when houses are construction in large quantity then the construction cost is much lower. The government land is mostly used to build affordable homes. Let’s consider that average cost to build a home is USD 10,000. Here is the calculation of 5 million homes cost;
1 home = USD 10,000
5 homes = USD 50,000
50 homes = USD 0.5 million
50,000 homes = USD 0.5 billion
5,000,000 homes = USD 50 billion
How government can collect the money to build homes?
Bringing money from abroad
Approximately Pakistani $200 billions are parked in Swiss Banks. At the same time billions of dollars have been laundered illegally. Many Pakistani corrupt people have invested black money in foreign real estate and other businesses. The government should bring back this looted wealth of Pakistan. The money is enough to build dams, roads, hospitals, schools and affordable homes.
Collecting money by ruthless accountability
Pakistani shadow economy is greater than the real economy. According to the experts real economy is just 30% whereas the shadow economy is 70%. The government can grab the ill-gotten money firstly by issuing the new currency notes and secondly by asking the source of income. Wealth of the people should be confiscated who can’t explain the source of income.
Spending property tax to build homes
The provincial and federal governments collect billions from the real estate sector. Government can allocate property taxes to build the affordable homes. All provincial governments can start their own affordable housing schemes. The federal government can assist the provincial governments.
Direct foreign investment
Many foreign Pakistani tycoons and Western governments are willing to invest in Pakistan. They just need a business friendly atmosphere in Pakistan so that their capital is secure. Pakistani government can ask the foreign investors to invest in affordable housing sector. This way Pakistani government can easily achieve its target to build 5 million affordable homes in Pakistan.
Benefits of building 5 million affordable homes
Building affordable homes have many benefits;
Firstly affordable housing will reduce the homeless in Pakistan.
Secondly home ownership will increase in Pakistan.
Thirdly abnormal home prices in Pakistan will crash. The property price crash will make the homes affordable and middle class will be able to buy the homes in the open market.
Fourthly large scale construction of affordable housing will create many jobs. This is because construction sector is related to many other industries. So the construction of 5 millions home will uplift the economy of Pakistan.
Government should immediately start the affordable housing schemes
Affordable housing should be included in the infrastructure development policies. The government of Pakistan should immediately start the affordable housing schemes across Pakistan. Affordable housing can be allocated to people in the following categories;
In first category 25% affordable homes should be provided to the people who have no money to pay the rents and are homeless.
In second category 25% affordable homes should be allocated to the people who can pay some rents but are unable to rent homes in the open market.
In third category 25% affordable homes should be sold out to the people who can pay the deposits and monthly installments. But homes should be sold out at very affordable rates as compared to the open market.
In fourth category 25% affordable homes should be allocated to the people who can pay the lump sum amount. Once again homes should be sold out at low price as compared to the open market.