Analysis of the Low-Income Housing in Isfahan Metropolis

Despite the importance of housing in human life, the provision of adequate and affordable housing for all people is one of the current problems of the human society because almost half of the world’s population lives in poverty and about 600 to 800 million people reside in substandard housing conditions. The present study, therefore, has been conducted in order to identify the needy groups and, too, housing the low-income groups in Isfahan City. The study is a fundamental-applied research adopting a descriptive-analytical methodology. Variables of the research are the income deciles, housing quantity developments, land and housing prices, the system of housing finance, housing status in the expenditure basket of the low-income households, the Gini coefficient of housing costs, the effective demand for housing in the income deciles considering the area of infrastructure and the access to housing index. The findings reveal that the year 2008 had the highest increase in the housing prices with an increase as 20.4% and the lowest one refers to the year 2010 with an increase as 8.6%. The Gini coefficient of housing cost for urban households shows a downtrend until 2005 and from 2006 onward, the gap has started to increase. Regarding access to the housing index, the results show that in 2003 the low income decile could afford one square meter of housing by saving the total household income for 75 days; whereas in 2011, this degree raised to 206 days. What is noteworthy here is the deep gap between the high-income and low-income deciles in the saving days for one square meter, which differs 10.5 times between the first decile and the tenth decile. The present article has been extracted from a PhD dissertation.


Introduction
Buying a house is often the biggest problem for a family in its lifetime.Furthermore, economic, social, and physical properties of the neighborhoods have short term and long term effects on the residents' physical and psychological status (Ellen et al., 1997).Accordingly, inappropriate housing would bring about many health risks, in a way that it would inflict adults, as well as children, with a variety of mental and physical disorders (Bratt, 2000;Kreiger & Higgens, 2002).Instable housing conditions, moreover, lead to stress and thus have manifold negative effects on people's education and professions (Rothstein, 2000).Despite the importance of housing in the human life, the provision of adequate and affordable housing for all people is one of the current problems of the human society because almost half of the world's population lives in poverty and about 600 million to 800 million people reside in substandard housing conditions (Datta & Jones, 2001).Despite poor housing conditions in developing countries, there are no organizations and institutions for supplying services and organizing institutional developments so as to strengthen different classes of the society (Anzorena, 1993;Arrossi et al., 1994).For example, 15% of people in Lagos, 51% in Delhi, 75% in Nairobi, and 85% in Lahore live in substandard housing.It has been estimated that thousands of low-income residents do not use healthy water transported from pipes and thus are pushed to use infected or substandard water (Hardoy, Mitlin & Satterthwaite, 2001).For instance, 33% of people in Bangkok and 5 million in Kolkata do not have access to healthy water and 95% of people in Khartoum live without sewage system.According to the report of the World Health Organization, the probability of death in children who live in substandard settlements is 40 to 50% higher than the children in European and North-American children (Benton-short and Short, 2008).That is because where they live is lacking in security and essential infrastructures and facilities like water, electricity and sewage; in addition, they are also vulnerable to numerous risks (Brunn, Williams & Ziegler, 2003).In 2005, about 30 environmental disasters led to a death toll of almost 90 thousand people, a majority of whom were from poor countries and low-income people (Chafe, 2006).
Planning in the housing sector in Iran is lacking an efficient statistical system.Despite these paradoxes, gaps and inconsistencies in the data and statistics from the housing sector, reaching to a comprehensive and clear plan to address the problems of this sector is almost beyond any possibility.The lack of cohesion among organizations responsible for collecting and arranging housing index information (Statistical Center of Iran, the Central Bank, Ministry of Housing and Urban Development, municipalities, etc.) should be considered as a serious problem.Aiming at evaluating the status of income groups and housing indicators -such as the average level of infrastructures, the average level of income, etc. -in existing deciles, the present study, therefore, has estimated housing demands and evaluated the financial power of low-income groups in aIsfahan so as to apply the given results in accurate planning of housing for the low-income groups in Isfahan.

Theoretical Framework
Housing is the smallest component of accommodations and is the concrete representation of development.According to Williams (2000), cities embracing social justice are those cities that have the greater share of high-density housing and provide services and facilities.Rappaport (1969) maintains that the factors of culture and human understanding of the universe, together with life, have played a crucial role in housing and its spatial divisions.According to Le Corbusier's viewpoint, a house must response to both physical and spiritual needs of people (Yagi, 1987).Housing is the basic environment of a family, and it is a safe place to wrest away from the routines of work and school, and is a private space.According to Fletcher, houses are paradoxical grounds of both tenderness and violence.Gaston Bachelard in the book, The Poetics of Space, has called home as an "atmosphere of happiness", wherein rest, self-discovery, relaxation and maternity become significant.According to Short (2006), housing is the nodal point of all dualities and paradoxes.Housing and housing planning have been analyzed from different perspectives.
The growth pole theory puts the acute housing problems as something transitional and as parts of development programs (Shefa'at, 2006).On the contrary, the theory of dependency counter-urbanization has recognized inequality and the one-sided product distribution from margin to the center as the main reason for housing deterioration (Athari, 2003).
From an economic viewpoint of the market, housing issues should be left to the market mechanism (Dojkam, 1994), and housing needs of the market system should be provided by the private sector (Seifaldini, 1994).The government should also avoid spending funds for low-income housing (Chadwick, 1987).The urban management approach, which, from the point of view of political economy, is a very important orientation, believes that wider social and economic contexts play a role in the formation of urban residential patterns.
One of the most important parts of urban planning is the planning of housing development; economic factors such as cost of living, employment bases and instability of income play very important roles in housing planning.Beside the economic factor, the architectural style is the most determining factor in housing planning.Regional indigenous languages, stylistic trends, weather, geography, local customs, and other factors influence the development of housing planning and housing design.The five characteristics of housing are: the type of building, style, density, the size of the project, and location (Sendich, 2006).Housing planning should be designed in such a way that in addition to adequate housing, basic ecological variables also to be included in (Inanloo, 2001).Governments often do housing planning at three categories of national, regional and municipal levels so as to be able to employ it as a technique to solve the housing problems of its citizens (Ziari & Dehghan, 2003).
The fundamental goal of housing planning in national level is to balance the housing supply and demand regarding its position in macroeconomics (Sadeghi, 2003).In regional planning of housing, supply and demand are evaluated in regional level and the aim is to balance them.The difference between housing planning in regional level and national level is that in regional level the relation between housing and macroeconomics is not considered, but it emphasizes on the economic potentials inside the regions (Zebardast, 2003).Local housing planning is conducted in three scales of town, city and urban areas.
Housing planning can be approached in two different ways.The first approach is the distribution of the goals and credits of national and regional plans to smaller geographic scales of region, city or town.The second approach is to investigate the housing status at local levels and to estimate the needed land for future housing development and suitable differentiation of the lands (Tofigh, 2003).The other approach is concerned with the low-income housing and presents three programs: 1.Those programs providing subsidies for rental housing, either as individual or in complexes; 2. those providing tax credits that result in the production of low-rent housing units; 3. supportive programs for affordable housing of the lower classes (Mills et al, 2006).Such a policy is along with tools such as tax-deductibility, long-term loans, insurance, and so forth.
The UN addresses the housing of those in need through the Commission on Human Settlements in the form of Habitat Program.In 1986, the UN codified the Global Shelter Strategy for the Homeless until the year 2000 with an empowerment approach.In 1992, there was addressed in Habitat 2 the security of the right for housing, particularly for the low incomes.In 2001, in the special session of the UN General Assembly in New York, the need to address the issue of urban poverty and homelessness received serious considerations.

Methodology
This study is a fundamental-applied piece of research adopting a descriptive-analytical method.The geographic area of the research is the political and administrative area of Isfahan City in 2014.Variables of the research are the income deciles, housing quantity developments, land and housing prices, the system of housing finance, housing status in the expenditure basket of the low-income households, the Gini coefficient of housing costs, the effective demand for housing in the income deciles considering the area of infrastructure and the access to housing index.The Statistical Centre of Iran provided the statistics and Isfahan provided the cost/income scheme.Methods used include statistical techniques of the population deciles and affordability of the groups, there has been used the function of the indirect method.

Changes in the Quality of Housing in Isfahan
According to the statistics, the population and urban growth had a great growth in decade from 1996 to 2006.The average of population growth in the years from 1996 to 2006 was 1.37%, the growth of the households was 52.3% and the growth of housing was 7.3% (Table 1).
According to the 2011 census, the population was about 1,908,968 individuals residing in 602,198 households, hence the size of each household is 3.17 individuals.However, the number of housing units constructed in the same year for 602,198 households in Isfahan was not standard and there was a housing shortage to the level as 0.193.But with the growth in the number of housing units in 2011, it can be stated that the 215000-unit policy of the Mehr Housing Project has had a large impact on the number of housing units in Isfahan (see Table 1).Source: the researcher's calculations, 2014

Evaluation of the Price Changes of Land and Housing in Isfahan
The value of properties (land, housing, and rent prices) is one of the main factors in determining the quality and quantity of people's housing; while housing and land become the playground of one's capital (as in current Iranian conditions), the tendency to have private housing increases and this issue leads to an increase in housing demands.Considering the instable status and the risks following certain other investment areas (such as manufacturing and agriculture, etc.), the tendency towards investing in housing sector has always been a safer investment and this has led to increase in the prices and widen the gap between effective demands and the potential demands.In total, the annual average of 20 percent of bank credits has been allocated to the housing sector which is a substantial amount.Therefore, considering the financial sources and potentials and absorption rate of bank deposits by the banks of the province, 20% of them can be considered as sources of investment in the housing sector.

Bank Development Credits
Government's development credits are the budget allotted annually and based on annual budget rules for implementing development plans and for expanding current expenditure on the government's economic and social plans, nationally and provincially.This budget is divided into the three general, economic and social categories.Considering the results, it can be argued that the credit of the sector has varied over years, and the these changes ranges from 5 to 12 percent of the entire budget, which is an important figure in its own right.
Of course, this might be due to the role of government and private sector in housing investment.Although in the recent years the government's role has become more serious with the emergence of plans such as Mehr Housing, retroffiting plan, and renovation of distressed areas.(Of course, one must notice that as of 2006 the economic sector has always received the highest credits.And, in the economic sector, the housing, and urban and rural sectors received the greatest amounts of credits).

Determining the Position of Housing in the Expenditure Basket of Low-Income Households of Isfahan City
To investigate housing costs in each of the income groups, first the study households were ordered in descending order during the years 2005-2011based on the amount of income.Afterwards, households were divided into equal groups (indicating Deciles).In the next step, based on the data regarding housing costs and the entire food and non-food expenditure of each household, the amount of housing costs and the entire food and non-food expenditure of each of the income Deciles was calculated for different years.Finally, the mean income and housing costs and the total food and non-food costs of households in each Decile were investigated.In order to present authentic and real analyses, all variables were calculated considering the ratio of price index in Isfahan to the fixed price of the year 2005.As displayed in Table 8, housing costs for Isfahan city have an increasing trend (except for the year 2009).The highest increase in housing costs took place in 2008 (%20.4) and the lowest increase occurred in 2010 (%8.6).
In this regard, it should be noted that the government's policies to establish stability and regulate market prices and prevent unduly increase have been very effective, such that the rate of price increase in relation to the previous year has been usually in the same price range.However, to present precise results of estimation of housing costs of low-income groups in Isfahan city, the results were analyzed in income Deciles (Table 9).As can be seen, enforcement of various economic policies in the housing sector and establishment of a balance between housing supply and demand in Isfahan city during the study period has been such that the average housing costs for high-income households was higher than low-income households.The highest increase belonged to the 10 th Decile (%36.1) and the lowest increase belonged to the 4 th Decile (%25.7).
In the following sections, to present precise results, the share of housing costs in the total costs of urban households will be analyzed in income Deciles (Table 10).(2003)(2004)(2005)(2006)(2007)(2008)(2009)(2010)(2011) In sum, investigation of housing accessibility index in Isfahan city shows a substantial difference among different income groups of this city in affording housing.In addition to the fact that, compared to other income groups, the low income groups of the city have to spend a longer period in order to obtain housing, the housing accessibility index have even worsened in low-income groups over time.For instance, whereas in 2003 the households of the first Decile could afford housing by working 49 years, this number rose up to 103 years in 2011, which means this group can never afford housing under current circumstances.Besides, investigation of the conditions of the beginning and end of the period shows that the waiting period for obtaining housing has almost tripled for all Deciles, although there have been fluctuations in the increase and decrease of the waiting period.

Conclusion
Generally, the trend of formation of economic and spatial duality and diversity in cities and regions commenced and was gradually consolidated after the industrial revolution in Europe and then the emergence of modernity in the periphery countries.In Iran, this trend commenced in the early 20 th century, and, as a consequence, increased urbanization resulting from this growth led to the accumulation of various problems such as poverty, homelessness and poor housing in Iran's cities.Faced with horizontal development restrictions, Isfahan city, as one of the province capitals, concentrated a great population of low-income groups in itself.Geographical distribution of low-income groups in Isfahan city is such that most of them reside in dilapidated areas.These areas include old areas containing or non-containing monuments, as well as neighborhoods with informal settlements.
The findings demonstrate that in 2011, the cost of constructing one square meter of lands in Isfahan city is 430,000 rials, whereas in the end of the study period this amount rose to 3,102,000 rials.The greatest increase in housing costs occurred in 2008 (%20.4), and the lowest in 2010 (%8.6).Mean housing costs for households of the upper Deciles were higher than those of households of the lower Deciles, such that the greatest increased belonged to the 10 th Decile (%36.1) and the lowest increase belonged to the 4the Decile (%25.7).Generally, by 2005, the Gini coefficient of housing costs for urban households followed an increasing trend, and the gap has been widening as of 2006.Investigation of effective demand among income Deciles of the city demonstrated a wide gap between the ability to obtain housing among upper and lower income groups of Isfahan city.With respect to effective demand ability among low-income groups, it can be argued that while in 2003 Deciles 1 to 4 owned 4 to 11 square meters of land, these numbers decreased to 1.9 to 5 square meters in 2011.Based on housing accesibility index, the results demonstrated that the low income Decile couled afford one square meter of housing by saving the income of 75 days; however, at the end of the study period (2011), this number rose up to 206 days.Moreover, in 2001 while the households of the highest-income Decile of Isfahan urban society needed to save the income of 10 days to afford one square meter, this number reached up to 23 days.The important point is the gap between high-income and low-income Deciles in the expected days (saving) for obtaining one square meter which was 10.5 times between the 1 st Decile and the 10 th one.Furthermore, while in 2003 the households of the 1 st Decile could afford their required housing by working 46 years, this number rose up to 103 years in 2011, which meant that it was practically impossible for these households to afford housing.

Table 7 .
Share of credits of the housing sector in social affairs program2006-2012 (million rials)

Table 9 .
Variation in the mean housing cost of urban households ofIsfahan city, 2007Isfahan city,  -2011 Source: Statistical Center of Iran, Plan for household cost and income of Isfahan city(2011)

Table 10 .
Share of housing costs in the total costs of urban households ofIsfahan, 2007Isfahan,  -2011.  .
Source: Statistical Center of Iran, Plan for household cost and income of Isfahan city(2011)mas.ccsenet