Mortgage crisis shows markets alone cannot ensure housing for all – UN expert

23 October 2008

The mortgage crisis that is at the heart of the current financial turmoil reflects “fundamental” flaws in the way countries approach housing, and highlights the danger in thinking that markets alone will ensure adequate housing for all, an independent United Nations human rights expert said today.

“The belief that markets will provide adequate housing for all has failed. The current crisis is a stark reminder of this reality,” the Special Rapporteur on adequate housing, Raquel Rolnik, said in a statement issued in New York.

“A home is not a commodity – four walls and a roof. It is a place to live in security, peace and dignity, and a right for every human being,” she stressed.

Ms. Rolnik, who reports to the Geneva-based UN Human Rights Council, noted that in the United States alone, the millions of homeowners and renters affected by foreclosures will result in a sharp increase in the numbers of the homeless.

“With the continuing housing and financial crisis spreading to many countries, things are only going to get worse. Millions more may face eviction because they cannot pay their mortgages.”

She said that most analysts blame the crisis on a shortage of liquidity or a failure of regulation. However, the sub-prime mortgage crisis reflects “fundamental flaws in our approach to housing” and the inability of market mechanisms to provide adequate and affordable housing for all.

“Excessive focus on homeownership as the one and single solution to ensure access to housing is part of the problem,” she stressed.

The Special Rapporteur suggested that the current crisis should force people to think of a better system, one that provides more housing options and avoids relying on a single solution. “We need to think out of the box.

“Homeownership may be the preferred option for many. But adequate housing for all is a public goal whose achievement requires a wide variety of arrangements, from tax advantages to buy a home to better legal protection for tenants and rent control areas; from direct subsidies to the poor to publicly owned housing and a range of tenure arrangements. Markets, even with appropriate regulation, cannot provide adequate housing for all.”

She urged those countries that have not already done so to legally recognize the right to adequate housing for all, noting that some developing countries are more advanced in that regard than many wealthier ones.

Ms. Rolnik took up her post in May of this year and serves in an independent and unpaid capacity, as do all UN Special Rapporteurs.

Ms. Raquel Rolnik was appointed in May 2008 as Special Rapporteur on adequate housing as a component of the right to an adequate standard of living and on the right to non-discrimination in this context. Her mandate involves reporting annually to the Human Rights Council on the status of the realization of the right to adequate housing throughout the world, and identifying practical solutions and good practices towards this end. An architect and urban planner, Ms. Rolnik has extensive experience in the area of housing and urban policies.


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