The low‐income housing market in Jordan

Purpose - The housing sector in Jordan suffers from a lack of balance between supply and demand, in general, and from the inability to meet the demands of low‐income households, in specific. The purpose of this paper is to explore the potentials and obstacles facing low‐income housing supply. It is shown that there is undersupply in low‐income housing. Design/methodology/approach - The attributes of the supply–demand model are explored using qualitative and quantitative research methods. The first research step was archival. Findings indicated a presence of major obstacles facing developers and hindering them from supplying low‐income housing. The second research step included face‐to‐face interviews with the local developers in three major cities: Amman, Irbid and Zarqa. They were interviewed using a semi‐structured and open‐ended questionnaire. Findings - Results indicated that most plausible causality of undersupply of low‐income housing is due to macro‐environment attributes: controllable – management (lack of human resources and capacity building), real estate (lack of marketing skills and sales advertising), technology and construction industry (inaccessible appropriate building technology and affordable construction), land ownership and site selection (limited to the developers geographical area); and uncontrollable – financing (small capital operation and difficulties in bank loans and lending), government policies (lack of incentives, tax exemptions, and rigid laws and regulations), and social and cultural (social needs requires certain spatial arrangements and rejection of borrowing from financial institutions for religious reasons). Practical implications - The study recommends increasing supply of low‐income housing can be achieved by various means and not by single attribute. Attributes affecting this price reduction and increase homeownership include implementing real estate principles and processes, co‐operation of all key‐players through various forms of public/private partnership, facilitating procedures in commercial banks, increasing the number of units that share services and infrastructure, constructing multi‐use housing projects, defining gradual revenue rates for services and limiting revenue rates for the housing units, developing local construction material, using simple shapes and configurations, and reducing non‐used space like the formal reception and dining areas despite their cultural value. Research limitations/implications - Statistical inferences will be needed in a future study to complement the present study's investigation of low‐income housing production in Jordan. Originality/value - As the first of its kind, the research help to identify policy implications for different partners (housing developers, local planning authorities, national housing and planning authorities and government policy makers) in order to increase homeownership for low‐income groups.