Skip to main content

Financialization of housing

Special Rapporteur on the right to adequate housing

I believe there’s a huge difference between housing as a commodity and gold as a commodity. Gold is not a human right, housing is.

- Special Rapporteur Leilani Farha, in documentary PUSH.

Housing and real estate markets worldwide have been transformed by global capital markets and financial excess. Known as the financialization of housing, the phenomenon occurs when housing is treated as a commodity—a vehicle for wealth and investment—rather than a social good.

With roots in the 2008 financial crisis, the impact of the shift from housing as a place to build a home to housing as an investment has been devastating. This includes millions of evictions as a result of foreclosures in countries most affected by the Global Economic Crisis.

In developing economies, informal settlements or long existing neighbourhoods located in ‘prime land’ are subject to evictions and displacement to make way for speculative investment. Residents are often rendered homeless, replaced by luxury housing that often stands vacant.

Global real estate represents nearly 60 per cent of the value of all global assets or $217 trillion USD—with residential real estate comprising $163 trillion USD or 75 percent. This represents more than twice the world’s total GDP.

The vast amount of wealth has left governments accountable to investors, rather than to their international human rights obligations.


Financialization of housing and the right to adequate housing (2017)

In 2017 Special Rapporteur Leilani Farha explores in her report (A/HRC/34/51) to the UN Human Rights Council the financialization of housing and its detrimental impact on the right to adequate housing. From mass forced evictions to make way for luxury developments, to nameless corporations purchasing real estate from remote boardrooms, to empty homes and people pushed out of their communities because they simply could not afford to live there, the repercussions have been felt across the globe.

The Special Rapporteur calls for governments to ensure markets serve housing need rather than investment priorities, and reminds states that they are first and foremost accountable to human rights. Read more recommendations on the report page.

The impact of housing finance policies on the right to adequate housing of those living in poverty (2012)

In 2012 Ms. Rolnik published a further report (A/67/286) on housing finance policies and their impact on the right to adequate housing for the poor. In the report she attacks the ruling paradigm of housing policies that focus on housing finance as the main means of promoting homeownership. She calls for a paradigm shift from housing policies based on the financialization of housing to a human rights-based approach to housing policies.

Housing, mortgage and financial crisis (2009)

In 2009, Special Rapporteur Rachel Rolnik highlighted in her report (A/HRC/10/7) that housing has become unaffordable in many cities owing to the mortgage and global financial crisis. In most countries, the market has become the main regulating institution, setting benchmarks for the price, location and availability of housing and land, including rental prices, while the role of the State in the management of public housing decreased. This has contributed to the perception of housing as a mere commodity and a financial asset, neglecting other dimensions of the right to adequate housing. The report argues that markets alone cannot provide adequate housing for all, and in some circumstances public intervention is needed. 

Documentary Film “PUSH”

Housing prices are skyrocketing in cities around the world. Incomes are not. The award winning documentary film PUSH sheds light on a new kind of faceless landlord, our increasingly unliveable cities and an escalating crisis that has an effect on us all. This is not gentrification, it’s a different kind of monster: the financialization of housing. The film follows Leilani Farha, the UN Special Rapporteur on the right to adequate housing, as she travel the globe, trying to understand who’s being pushed out of the city and why. Read more about PUSH (2019), directed by Frederik Gertten (WG Films, Sweden, 92 min.).

Letters raising business practices of concern

On 22 March 2019 the Special Rapporteur and the Working Group on Business and Human Rights sent a series of letters to six countries and one of the largest real estate equity firms, Blackstone Group.

In a joint media statement, the two UN human rights mechanism condemned the “egregious” business practices of giant private equity and investment firms which are scooping up low income and affordable homes around the world, upgrading them, and substantially raising rents, forcing tenants out of their own homes.

They also underlined that real estate equity firms have an independent responsibility to respect human rights, which means that they need to conduct human rights due diligence in order to identify, prevent, mitigate and account for how they address adverse impacts on the right to housing.

The experts also reminded States of their human rights obligations to regulate investment in residential real estate so that it supports the right to adequate housing and in no way undermines it.

The letters sent and replies received are available below.

Business enterprises