Housing problems in growing cities

Demand, supply and affordability

When demand for housing grows faster than supply (population growth, migration, smaller households, investors buying property) prices and rents rise. The result:

• Affordability problems: a growing share of income goes on housing; first-time buyers and low-income renters are priced out.
• Income deprivation: after housing costs, households cannot afford food, heating or transport.
• Homelessness: rough sleeping and 'hidden' homelessness (sofa-surfing, temporary accommodation).
• Overcrowding: several families or generations sharing small homes.

The June 2025 paper gave Cape Town's house price index and asked for two problems caused by the trend: the mark scheme credited less affordable housing, rising homelessness, self-built or illegal settlements, longer commutes, cutting spending on food or medicine, greater inequality and exclusion from renting or buying, but not a description of the trend alone.

Slums in developing and emerging cities

Where formal housing is not built fast enough, people build their own on land they do not own: squatter settlements and shanty towns (slums or informal settlements). UN-Habitat (SDG 11 factsheet, 2023):

• Nearly 1.1 billion people lived in slums or slum-like conditions in urban areas in 2020.
• That is 24.2% of the urban population, down from 25.4% in 2014: the share is falling but the number is rising.
• An additional 2 billion people are expected to live in such conditions over the next 30 years.
• 85% of slum dwellers live in three regions: Central and Southern Asia (359 million), Eastern and South-Eastern Asia (306 million) and sub-Saharan Africa (230 million).

Source: UN-Habitat SDG 11 factsheet (2023)

Urban sprawl and planning

Informal growth and cheap land on the urban fringe produce urban sprawl (peri-urbanisation): low-density building spreading over farmland, often without roads, water pipes or sewers. Implications for planners:

• servicing scattered settlements is expensive;
• residents face long, costly journeys to work;
• settlements on floodplains or steep slopes are exposed to hazards;
• governments must choose between eviction, upgrading in place, or building new formal housing (see the urban planning lessons).

Worked example

A city's house prices double in ten years while wages rise by 20%. Explain two likely social consequences.

1. Housing becomes much less affordable because prices rise far faster than incomes.
2. Low-income households spend more on rent, so they cut other spending or become homeless.
3. Some move to overcrowded housing or informal settlements on the edge of the city, facing long commutes.

Answer: Falling affordability leads to homelessness, overcrowding and informal housing.

Check yourself

1. Using the UN-Habitat figures, how many million slum dwellers lived in the three named regions combined in 2020?
   Show answer

   895 million. 359 + 306 + 230 = 895 million.

2. What percentage of the 895 million in those three regions lived in sub-Saharan Africa? Give your answer to 1 decimal place.
   Show answer

   25.7 %. 230 / 895 x 100 = 25.7%.

3. Between 2014 and 2020 the share of the urban population living in slums fell from 25.4% to 24.2%. What does this show?
   • The share fell, though the number of slum dwellers can still rise as cities grow
   • Slums are disappearing completely
   • The number of slum dwellers halved
   • Cities stopped growing
   Show answer

   The share fell, though the number of slum dwellers can still rise as cities grow. A smaller share of a much bigger urban population can still be more people.

4. Which answer would gain credit for a problem caused by rapidly rising house prices?
   • House prices went up from 2015 to 2023
   • The graph shows an upward trend
   • House prices are measured as an index
   • More people are excluded from buying or renting a home
   Show answer

   More people are excluded from buying or renting a home. The mark scheme credits problems linked to the trend, not descriptions of it.

5. Urban sprawl is a planning problem mainly because
   • it makes cities more compact
   • low-density spread is expensive to supply with roads, water and sewers
   • it reduces commuting distances
   • it only happens in rich countries
   Show answer

   low-density spread is expensive to supply with roads, water and sewers. Services must stretch over a large area.

6. Explain why slums grow in rapidly urbanising cities in developing countries.
   Show answer

   Rural-urban migration and natural increase raise the population faster than the government or builders can provide affordable formal housing, so migrants build their own homes on vacant land they do not own.. Population growth, lack of housing, self-built.

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Sources

• Pearson Edexcel International Advanced Subsidiary/Advanced Level in Geography specification, Issue 3 (September 2025)
• UN-Habitat: SDG 11 factsheet, HLPF 2023
• Pearson WGE02/01 mark scheme, June 2025

Last updated 8 November 2026. Spotted a mistake? Tell us.