The inadequate provision of shelter to the urban poor continues to be Pakistan’s most immediate pressing problem. Housing backlog, as estimated according to the 1998 census, was over 4.3 million units with an annual incremental demand of 500,000. These figures should be juxtaposed with the fact that there is no shortage of housing for one third of the population, which is categorized as the affluent middle class. To understand this phenomenon better, it is necessary to critically examine what is happening in the housing sector. In large towns, land is planned and disposed of by powerful interest groups (in both public and private sectors) through the creation of low-density housing colonies that result in an uncontrolled and automobile-dependent urban sprawl. The demands of the elite are fully met, be it through housing credit or subsidized infrastructure. Since the needs and demands of low-income people are ignored, ecologically unsafe wasteland is informally converted into increasingly smaller plots. This is generally done by a group of people known as the “land mafia,” who operate in collusion with corrupt government officials and the police. They sell state land illegally or subdivide private agricultural land and sell it at a price low- income people can afford to pay. In both cases, the price is low due to lack of infrastructure and legal documents of ownership. As a result, approximately 40 percent of Pakistan’s urban population lives in squatter settlements or sub-standard informal housing, locally termed as katchi abadis*. Cities like Karachi, Lahore, Quetta, Peshawar, and Faisalabad are facing acute problems because of this situation. In the past 66 years, successive governments have launched various schemes in the name of the poor, such as, small built-up units, metrovilles, site and services, three to five Marla schemes, widows housing from zakat fund, and Prime Minister Nawaz Sharif’s scheme of low cost flats on prime locations. However, these schemes have failed to meet the demand of low-income groups because in most cases.