Our cities are not allowed to grow up

Part two: the housing policy speaks the language of dense, vertical cities, and leaves out every reform that would build them.

Last week I asked what Pakistan’s new housing policy forgot to ask. This week, what it forgot to read.

For two decades, with colleagues at PIDE, I have argued that our cities should grow up, not out. Reading the policy’s talk of compact, mixed-use, high-rise cities was like hearing your own song on the radio, sung by someone else, with the second verse missing.

The song is not obscure. In 2007 Durr-e-Nayab and I edited Cities: Engine of Growth. It argued that our cities are low, single-use, built for cars and plots, and run by rotating civil servants rather than elected mayors. The Planning Commission’s Framework for Economic Growth (2011) put cities at the heart of growth. The PIDE Reform Agenda (2020) listed the fixes: high-rise, mixed-use buildings as of right, sensible parking rules and state land opened up. That year I also published Contextualizing Pakistan’s Cities and worked with the Lahore Development Authority on how Lahore could go up.

The core message was simple. We confuse two kinds of rules. Zoning should decide what goes where and how much can be built in each area. Building rules should only keep buildings safe. In Pakistan, both are buried in the building bylaws and applied plot by plot: height limits, setbacks, plot coverage, conversion fees. So builders fill every permitted inch with low boxes, and only large plots may go tall. Let zoning set how much floor space each area can carry, keep building rules for safety, and let owners build to meet demand. The city will grow on its own.

The policy borrows this language without citation or consultation. Its first complaint about the 2001 policy is that it failed to promote compact, mixed-use, high-rise housing. Its second objective is to do exactly that. It even proposes “form-based codes”. The right words, with none of the changes that would make them real.

Floor-area ratios are not mentioned. Height caps are not lifted; height appears mainly as a fire hazard. Parking requirements and setbacks go unquestioned. Conversion fees, a tax on building up, survive. A developer gets half back only if 80 percent of the floor space goes to low-income flats. No serious builder will take that deal.

Instead, the policy reaches for planners’ tools: growth boundaries, quarter-kilometre green belts, master plans every five years, and a rule that housing schemes set aside land for apartments, paid for by charging more for bungalow plots. It wants density only to save farmland. That is a planner’s argument. Ours is an economist’s: let land go to its most valuable use and density follows.

Fence a city in while capping its height and land gets dearer, with nowhere to spread the cost. The poor are pushed into katchi abadis, which is the one place the policy wants towers: slums rebuilt as high-rise blocks with shops below. Density for the poor, on land they already hold. The one-kanal sectors are left in peace.

And the officers’ colonies? We argued for selling the official housing and office estates on prime central land, and for taking the regulator out of the property business. The policy instead wants a “substantial budget” for more government employee housing.

Beneath the cities lies the land, and here the policy barely looks. Our land record is the patwari’s revenue register, built to collect tax, not to establish ownership. A mutation is presumed correct only until someone proves otherwise, so land cases outlive their litigants. Punjab’s digitised fard is a faster copy of the same uncertainty. In cities, much property rests on authority files, allotment letters and stamp paper. No bank lends for twenty years against that, and no builder can assemble small plots into a tower site.

Land records are provincial, but credit, banking, taxation and Islamabad are federal. The federation should fund a title registry the state guarantees, starting in the capital. The policy instead proposes new authorities to digitise old records. Digitising the patwari is not a property rights system.

Clear title is half a market. The other half is price. A plot sells at one price and is registered at another: the DC rate or the FBR valuation, both set for revenue and both well below what buyers actually pay. In a 2022 PIDE paper, Ahmed Waqar Qasim and I argued for abolishing both. Black money lives comfortably in that gap, which is why the plot became the national savings account. No buyer can see what the house next door fetched, no bank can value its collateral, and no city can tax land properly.

Our fix: abolish administered valuations, list every sale on a public portal, and post each contract for two weeks before transfer, with the deposit in escrow, so anyone can outbid. In short, a broker-run multiple listing service, as in every working property market. The policy mentions “inconsistent property valuation practices” once and moves on. Its answer is a Real Estate Regulatory Authority, which our 2022 research found silent on price and information, and one more gate for developers who already need some twenty-two NOCs. A referee for a match nobody has been allowed to start.

Why borrow the words and skip the substance? Because the substance threatens the permission economy. Height as of right removes discretion. Selling state land ends a perk. A title registry ends the patwari’s rents. Transparent prices close a convenient haven. Slogans cost nothing. The drafters were officials, planners, engineers and developers who run the present system, with donors at their elbow. Economists who have costed that system were not in the room.

So here is a modest test. Scrap DC rates and publish every transaction price. Start a guaranteed title registry. Lift height and floor-area limits in the downtowns of our cities and see what gets built. Sell an officers’ colony or two. If the skyline changes, I will happily admit the policy worked.

Copyright Business Recorder, 2026