This chapter deals with the physical aspects of the improvement of existing slums; the residents may or may not be squatters in the legal sense, but it is assumed that some regularisation of land tenure will be necessary. Given existing rates of natural growth and in-migration, new slum areas will be created faster than the old ones can be upgraded, unless a related programme of sites-and-services projects is sustained. The registered households will usually be the owners of the houses; whether renters are allowed to become beneficiaries will be a matter for local policy, but it should be borne in mind that, with the extra costs of upgrading, the owner-households will find it even more necessary to rent out part of their houses. The type of solution and the new layout must be discussed with the residents to ensure that the project will succeed.