Informal housing or informal settlement can include any form of housing, shelter, or settlement which is illegal, falls outside of government control or regulation, or is not afforded protection by the state. As such, the informal housing-industry is part of the informal sector. To have informal housing status is to exist in "a state of deregulation, one where the ownership, use, and purpose of land cannot be fixed and mapped according to any prescribed set of regulations or the law". While there is no global unified law of property-ownership typically, the informal occupant or community will lack security of tenure and, with this, ready or reliable access to civic amenities. Due to the informal nature of occupancy, the state will typically be unable to extract rent or land taxes. The term "informal housing" is useful in capturing informal population other than those living slum settlements or shanty towns, which the UN Habitat defines more narrowly as "contiguous settlement where the inhabitants are characterized as having inadequate housing and basic services, often not recognized or addressed by the public authorities as an integral or equal part of the city." Common categories or terms associated with informal housing include: slums, , shanty towns, squats, homelessness and pavement dwellers.
Population around the world face issues of homelessness and insecurity of tenure. However, particularly pernicious circumstances may obtain in developing countries, leading to a large proportion of the population resorting to informal housing. According to Saskia Sassen, in the race to become a "global city" with the requisite state-of-the-art economic and regulatory platforms for handling the operations of internationalfirms and markets, radical physical interventions in the fabric of the city are often called for, displacing "modest, low-profit firms and households". If these households lack the economic resilience to repurchase in the same area or to relocate to a place that offers similar economic opportunity, they are prime candidates for informal housing. For example, in Mumbai, India, fast-paced economic growth, coupled with inadequate infrastructure, endemic corruption and the legacy of restrictive tenancy laws have left the city unable to house the estimated 54% who now live informally. Many cities in the developing world are experiencing a rapid increase in informal housing, driven by mass migration to cities in search of employment or fleeing from war or environmental disaster. According to Robert Neuwirth, there are over 1 billion squatters worldwide. If current trends continue, this will increase to 2 billion by 2030, and 3 billion by 2050. Informal housing, and the often informal livelihoods that accompany them, are set to be defining features of the cities of the future.
