AN advertiser in a daily newspaper wants for his 250 square yard plot with four rooms in Defence Housing Authority Rs10.30 million. Another advertiser in the same area wants for his plot of 300 sq yards with four bed-rooms Rs10.65 million. A third advertiser in the Clifton-Defence area wants for his 1,000 sq yards plot with six bed rooms rupees Rs40.50 million. These are only samples of the advertisements which run into many column or pages. These advertisers may be able to get what they want for their plots or houses, or somewhat less. But what a man with the average income is going to do to acquire safe shelter that is becoming of his rank or station in life after years or decades of hard work, often of the entire family.

Traditionally, the rent of a house built in recent times is one per cent of the cost. That means if a house cost Rs10 million its rental income should be Rs0.1 million a month. How many of us are able to pay a rent of Rs0.1 million on a house built on 250 or 300 square yards. What about houses which are very small and the owner still expects a very high rent or price?

Our house prices are touching New York rates for commercial purposes. After paying such rents to real estate owners, at what prices do they sell their goods in the cities? And will the difference between the central city rates for goods and mofussil prices or rural prices be very vast. These are the kinds of pricing puzzles which we will face soon. We have to be ready with the answers or solutions.

The government was initiating a housing policy to promote the construction eventually of 7.2 million housing units in short supply in the country. It had a multi-pronged approach. The housing industry would promote 40 other industries in the construction sphere beginning with steel and cement, and ending with chemicals and paints. It would also provide employment to millions of skilled and unskilled workers. But shortage of money hit the initiative.

Now we are told the industry needs Rs70 billion; but only Rs4 billion is readily available. The gap exceeds Rs60 billion.

Meanwhile, the prices of plots have shot up sky high. Even little plots cost a great deal of money. Cement and steel prices too have gone up. House-building has become too costly while bank credit is too meagre and is tied up with two many conditionalities.

Small increases in loans promised by the House Building Finance Corporation have brought scant relief. Low-income groups have not benefited from bank lending. But the affluent can borrow. Even for many of them the land prices are too high and rising all the time and the brokers are not making firm commitments of sale. And the prices of the building materials have gone high, and skilled construction workers are not readily available. And when they their wages are too high.

All that has forced the State Bank of Pakistan to lift the ceiling of Rs10 million imposed on banks for lending for house building. But it is one thing to lift the ceiling and another to make the loan actually available to genuine house-builders.

What is remarkable is that for the all the large fortunes made by those who sell plots of land at giddy prices and houses even at higher prices, and make millions of rupees overnight, they pay no taxes, while the man with small means is forced to pay heavy taxes, including hefty sales tax of 15 per cent. Affluent overseas Pakistanis used to be the envy of resident Pakistanis. But now to add insult to injury the resident Pakistanis who have become overnight millionaires are the envy of overseas Pakistanis.

In a letter to the editor of this newspaper last week an agonised lady wrote that she and her husband had worked over 20 years abroad and saved money to buy a home when they returned to the country and set up a small business. But now, to their lasting distress they find that housing prices had shot up that high, they could just afford a small house and forget all about their long dream for small business.

The Law and Justice Commission has come up with an excellent Amendment to the law banning land grabbing. It has raised the punishment for land grabbing and ‘Qabza’ group to 10 years’ rigorous imprisonment from three to five years. It is for the government to act on this decision and prevent the Qabza’ groups which will become far more active following the sky-rocketing real estate prices.

In fact, if it had acted earlier on the old law and sent land grabbers to jail for three to five years, there would have been far less land grabbing. Now the government has to be far more active in this area and re-possess much of the illegally grabbed lands.

The government has also suggested to the prime minister to set up an agency like NADRA to register all the lands in the country and have a central agency for keeping land-owning data, through computers. That will indeed be very welcome.

The question now is: Will the commercial banks cut short their loans to the housing sector as they have been persuaded by government to mount a rescue operation for the Karachi Stock Exchange running into hundreds of millions of rupees? In the KSE, the banks will have to bail out the rich and super-rich who had in recent months made too much money. But in the case of lower income housing, it will be helping the helpless, the lower and middle income groups hit hard by soaring land prices.

The prime minister has been urging the chief ministers to release unused government land for housing for the poor and low income groups but the provincial governments are reluctant to do so as to keep the surplus land in reserve for their own political gains. Greater pressure should be brought on the chief ministers to release the land so that the land prices do not sky rocket further.

The State Bank should come up with a detailed and credible policy in respect of housing in the vastly changed conditions. If it can act with alacrity in the area of the KSE crisis, it can certainly act in the a area of helping the poor and low income groups get bank loans for houses with reasonable guarantees.

Z.A. Bhutto promised ‘roti, kapda, makan’. While he focused on the first and free education for the poor he could not do much in the area of housing after the 57 per cent devaluation of the rupee in 1972 and quadrupling of oil prices in 1973 which thereafter went on increasing.

Prime Minister Mohammad Khan Junejo came up with a housing policy that promised 2.2 million houses beginning with free plots but he could not make much headway as bureaucracy blocked his path.

Any successful housing policy will be a costly one and take tremendous efforts. And it should come as a ten year policy to which all parties are committed. Otherwise the project may be given up halfway. Bank loans alone cannot achieve miracles when land prices have hit the skies and construction costs are too high.