Urbanisation After the Megacity: Small Cities, Housing Systems and the New Geography of Growth

Abstract

Urbanisation is often discussed through the image of the megacity, but the empirical centre of gravity of urban growth has moved elsewhere. This article examines what the most recent global evidence reveals about where urbanisation is happening, in what forms, and with what consequences. It reports a comparative secondary analysis of the 2025 revision of the World Urbanization Prospects, which for the first time applies a harmonised Degree of Urbanisation classification, together with the 2026 World Cities Report and the 2026 SDG 11 Global Report. Five findings emerge. First, cities now contain 45 per cent of the world's population, up from 20 per cent in 1950, while towns account for 36 per cent and rural areas for 19 per cent. Second, the megacity is the exception rather than the rule: of roughly 12,000 cities, 81 per cent have fewer than 250,000 inhabitants and only 33 have ten million or more. Third, future growth is highly concentrated: of a projected 986 million additional city dwellers by 2050, more than half will be added in seven countries. Fourth, urbanisation is not uniform in direction - more than 3,000 cities recorded population decline between 2015 and 2025. Fifth, the housing system is the binding constraint: informal-settlement populations rose to over 1.16 billion in 2024 while the proportion of urban residents living in such settlements has barely moved since 2015, and the global housing deficit grew from 251 to 288 million units. The article argues that the analytical and policy unit should be the settlement system - cities, towns and rural areas together - rather than the large city alone, and that housing, land and infrastructure capacity rather than migration management determine whether urbanisation delivers productivity or backlog.