Housing as economic policy: the role of housing in addressing SA's biggest challenges

Abstract

Housing is a much-debated topic in South Africa, and often hits the headlines, but it is rarely discussed from an economic perspective. Yet its embeddedness in the economy is conspicuous. Stark differences in housing conditions, especially between the leafy suburbs and overcrowded townships in our cities, reflect longstanding socio-economic inequalities. Growing levels of informal housing and homelessness are the result of structural exclusion, coupled with burgeoning unemployment and poverty. Meanwhile, private property has become a major investment vehicle and a means of growing wealth for middle-income and rich households: owner-occupied housing is South Africa???s single largest asset class worth more than R3 trillion. Activating housing's function as an economic and financial asset for the poor has also become a feature of recent government initiatives like Operation Vulindlela. While most people have experienced the intricate relationship between housing and economy, especially during pandemic-induced government lockdowns, the linkages between the two are not always well understood. There is a lack of systematic data and critical research on the economic aspects of housing in South Africa, especially from a political-economic perspective institutional crisis. While many housing scholars neglect the economic and financial dimensions of housing, economists tend to ignore housing's various roles in wealth production and distribution. Policy debates on housing are dominated by social justice and human rights concerns without adequate connection to economic policy discussions.