The nature of the housing sector with its institutions, laws, and regulations, touches every single aspect of the economy of a country and has an interface with practically every social development sector. People living in adequate homes have better health, higher chances to improve their human capital, and seize the opportunities available in urban contexts. At the same time, a housing sector that performs well acts as a ‘development multiplier’ benefiting complementary industries, contributing to economic development, employment generation, service provision, and overall poverty reduction.

Broadly, for every job in the house-building sector, an additional 1.5 to 2 jobs are generally created in the construction materials and other input industries. The contributions of housing to urban prosperity are also evident. The UN-Habitat City Prosperity Initiative indicates that inadequate housing has negative effects on several other dimensions of urban prosperity. Urban contexts with housing conditions below average experience poorer equity and inclusion reduced urban safety and livelihood opportunities, and have neglected connectivity and provision of public space.

Inadequate housing thus remains a global urban sustainability challenge, but also a development opportunity. At the same time, the thematic area of ‘adequate housing’ and especially the term ‘slums’ – are often highly politicized. More nuanced definitions of these terms would enable and support a more robust and measured debate, greater engagement by all key stakeholders, and the development of specific recommendations for application within each context and place.

Several interrelated terms must be grappled with when considering an indicator for SDG Target. They include inadequate housing and housing affordability, informal settlements, and slums.