The prospect of low-cost housing provision by the private sector: a case study on the urban poor in Bangkok

Abstract

Spontaneous settlement has been a major problem for Third World cities since the 1940s.Urban low cost housing not only helps solve the housing deficiency issue in the cities, but it also helps ease the cost of labour and amplify the level of industrial development as well.State intervention on housing provision could hardly solve the problem, since it requires large amounts of fiscal budget and efforts.The research aims to investigate the possibility of involving the private sector to provide low-cost housing to the urban poor.The study applied a questionnaire survey on 1,000 low-income households from the Bangkok inner city, suburban Bangkok, and outer Bangkok, together with 88 real-estate firms in various sizes and classes to obtain data matching the needs of the urban poor with the interest of private sectors to join the program.The study found that most real estate operators agreed with the collaborative ideas but not necessarily wanted to join the program.The study found that the Baht 350,000-500,000 range of price was most feasible for private public collaboration to provide housing for the urban poor in Bangkok.For housing types, the private sector was mostly interested in doing projects in the condominium and flat types.For incentives, the private sector gave priority to the connection of utilities, the relaxation of development control, tax reduction on commercial tax, and relaxation on the property transfer tax respectively.The study suggested that outer Bangkok would be an ideal location for potential schemes to cut land cost.Since the most attractive incentive was title deed transfer tax break, followed by exile tax reduction, relaxation of estate and building regulation, and the right to public utilities and infrastructure connections.