A/67/286 dispersion on social stratification and inequality, and the uneven spatial impact of these processes within cities, regions and globally. 18 13. The affordability crisis was compounded by the erosion, neglect and liberalization of non-market mechanisms for allocating housing resources. Even countries with a long tradition of broad-based social rental housing have redefined their systems to promote ownership, “free market” principles and competition policies. Thus, there has been a significant reduction in the construction of adequate housing for the poor and most vulnerable groups along with decreasing national budgets and available public funds. In the United States, the budget of the Department of Housing and Urban Development was cut from $83 billion in 1978 to $18 billion in 1983 and between 1996 and 2001, no funding was allocated to public housing construction. 19 The constant reduction in public housing has resulted in long waiting lists, keeping a large number of people in inadequate housing conditions (A/HRC/13/20/Add.4, para. 21; see also A/HRC/10/7). Even in the former Soviet countries, which did not experience a shortage of housing in the short term (following mass privatization), low-income households were soon faced with a huge affordability problem. 20 14. With the decline of State investment in the social housing sector and the increasing focus on homeownership — which also led to a shrinking private rental market 21 — access to housing finance became vital for low- income households, who were left with no other option for securing shelter than to embark on credit schemes to purchase homes, if, where and when those homes and credit became available and under the conditions defined by real estate and financial markets. 15. Although most countries apply a myriad of housing finance policies and programmes, the Special Rapporteur has decided to focus her report on the three policies that have been implemented most prevalently as a means of facilitating access of the poorest and most disadvantaged to housing finance for homeownership: the increase in the scale of mortgage lending for low-income borrowers; the provision of capital subsidies to low-income groups as a means of supporting entry of households into housing credit markets; and microfinance for housing construction or improvements. The present report analyses these approaches and assesses their impact on the right to adequate housing of those living in poverty. II. The human rights framework for housing finance 16. Housing finance policies directly affect the affordability component of the right to adequate housing (article 11, paragraph 1, of the International Covenant on Economic, Social and Cultural Rights). States should establish laws, policies and __________________ 18 19 20 21 6 Ray Forrest, “Globalization and the Housing Asset Rich: Geographies, Demographies and Policy Convoys”, Global Social Policy, vol. 8, No. 2 (August 2008), pp. 167 and 178-179; Jian-Ping Ye, Jia-Ning Song and Chen-Guang Tian, “An Analysis of Housing Policy During Economic Transition in China”, International Journal of Housing Policy, vol. 10, No. 3 (September 2010), p. 273. Western Regional Advocacy Project, 2012 HUD Budget Fact Sheet, 2011. Reply of Slovakia to the questionnaire. UN-Habitat, A Policy Guide to Rental Housing in Developing Countries, Quick Policy Guide Series — Volume 1 (Nairobi, 2011); UN-Habitat, Rental Housing: An essential option for the urban poor in developing countries (Nairobi, 2003). 12-45918