How to house the world's poor: The $300 house of ideas

It's a problem that has baffled governments and obsessed NGOs for decades: how to get safe and clean shelter for the world's poorest citizens.

Now, an Ivy League business professor and an online marketing consultant are using a radical approach to find the solution, launching an Internet competition to come up with designs for a house that will cost only $300. What's more, the houses are to be sold to those who need them, treating the global poor as a business opportunity rather than a charity case.

The consultant, Christian Sarkar, started thinking about the problem after the Haitian earthquake ruined countless houses. He approached Vijay Govindarajan, who teaches international business at Dartmouth College, and the pair wrote a blog post on the topic for the Harvard Business Review last summer. In part, the $300 figure was based on studies showing the average value of shelters of those who have escaped poverty; in part it was an arbitrary number to get people thinking cheap.

After a flood of calls and e-mails from people interested in the idea, they set up a contest on the crowd-sourcing website Jovoto, which closes later this month.

Certain ground rules apply. Houses must include spaces to sleep and cook; have access to drinking water, electricity and light; be resistant to fire and natural disasters, and be made of material that can withstand the elements for at least 50 years.

A panel of judges will choose several winners, who will attend a business incubator to create prototypes. The hope is the designs will be picked up by companies and sold throughout the developing world.

"We're trying to encourage companies to look at the bottom of the pyramid, at the poor, as customers," Mr. Sarkar says. "What you've got to do is make it a business and make it to scale."

The advantage of using the free market, rather than relying entirely on charity or government, is that private companies can spread a successful product between countries, he argues.

So far, more than 40 proposals have been submitted on Jovoto, ranging from a hut built primarily of two-litre pop bottles to a house with walls made from sandbags to a structure with corrugated metal walls joined by wooden pillars, stacked one on top of the other like bunk beds.

Javier Tenorio and Fernando Garcia-Landois, engineers in Monterrey, Mexico, decided to put their heads together after reading the initial blog post.

"We find it's interesting because, in Mexico and Latin America, there is a lot of low-income housing and people who are struggling to have a home," Mr. Garcia-Landois says.

The pair's proposal is for a triangle-shaped house built of galvanized metal, oriented strand board and mounted on a concrete pad. It is designed to be simple enough for people to assemble on their own.

In Hodal, India, meanwhile, mechanical engineering student Surender Singh's design incorporates readily-available local materials. Anchored by columns created out of metal sheets taken off discarded vehicles, the building's walls are made of panels made from recycled plastic bags and the whole thing is designed to be heated and cooled through natural convection.

"[Poor people]spend a larger proportion of their income on health and maintenance of their shelter and not on education or upgrading their work skills, thus neglecting the future of their children and reducing the chances of increase in income," he says. "My house is designed to break this cycle."