The need for adequate housing has been a pressing problem for Algeria for several decades. In 1964, the Ministry for Housing and Construction was created to aid in reconstruction and upgrading of damaged and substandard dwellings. The government's 1965 financial reform provided for regularization of ownership and collection of rents from some 500,000 nationalized or sequestered apartments and houses in the major cities. Migration to the coastal cities during the 1960s and 1970s aggravated the housing problem, and in the 1974–77 development plan the government took steps to curb the flow.
The 1980–84 plan called for the construction of 450,000 new housing units; the building effort failed to meet the target because of shortages of construction materials. In 1982, the government committed more than $1.5 billion to prefabricated housing, some of it as part of a program to build "model villages" for workers on state farms or in state-owned enterprises. In 1998, the World Bank offered the nation a loan of US $150 million for a 10-year program to improve and create low-income urban housing, thus eliminating urbans slums.
Private housing construction is also permitted and is subsidized at the local level.
About half of all housing units are individual houses, with the remaining housing falling into three categories: traditional houses called "haouches;" flats or apartments; and shacks or other marginal arrangements. In 2000, About 94% of the population had access to improved water sources; 73% had access to improved sanitation systems.