An increase in demand for urban housing in the latter half of this century had led to the emergence of housing as a priority sector for many national governments and public authorities around the globe. The Global Report on Human Settlements 1986 (UNCHS) indicates that 40-50% of the population lives in slums and informal settlements in many cities of the developing world. While not all informal settlements provide unsatisfactory living conditions, they are usually inadequately served with essential infrastructure. Extremely high population densities and room occupancy rates, although not proof of unsatisfactory housing conditions, usually do indicate an inadequate supply of housing. Even as the fairly recent attitude of “slum eradication” is slowly transforming to “slum upgradation”, the very fact that they need to be ‘upgraded’ implies that they are lacking, or at least considered so by the authorities.

Nepal, however, presents a striking paradox to this universal phenomenon. Despite the fact that it is among the poorest countries in the world, its capital and predominant urban center, Kathmandu, do not face the problem of slums to the extent prevalent in other third-world cities. Although the quality of housing is low for a vast majority of the population, the incidence of extremely poor living conditions is fairly limited.