When state or municipal aid must be given, the degree and form it takes will have much to do with the wisdom or propriety of giving it. Whether or not it should be given depends on what it is given for, how it is given, and whether general public benefit is obtained as a result. There is good reason to doubt the methods followed in some countries in building or subsidizing the building of houses for one group of the community at the expense of other groups, and it is equally questionable whether cheaper money or limited tax exemption can be given an equitable basis.
In connection with the reconstruction of slum areas and the renovation of blighted districts, much public aid to housing can be undertaken without actual subsidizing of house building as a charitable undertaking. When this reconstruction or renovation is essential for the benefit of the whole community, it may properly be paid for out of the public purse and the incidental housing improvement may be welcomed. There are cases also where a government may properly incur expense to create an object lesson in better housing. One thing which it is always proper for a government to do is to purchase land for small parks and playgrounds as a means of providing more space in congested areas, and it is in this respect that so much can be done as a means of removing one of the worst defects of slum districts.
When state or municipal aid is given, it usually takes one or more of the following forms: First, granting loans at low rates of interest to individuals, public-utility societies or municipalities; second, granting outright subsidies to individuals or to others for the construction of houses having a certain standard; third, direct state action to provide houses for sale or for rent; and fourth, exempting houses of a specified cost and character from taxation for a limited time.