New Report Assesses Programs to Improve Life in Latin America's Slums

May 10, 2011, 07:05 ET from Lincoln Institute of Land Policy

Regularization of Informal Settlements in Latin America looks at awarding titles, upgrading

CAMBRIDGE, Mass., May 10, 2011 /PRNewswire-USNewswire/ -- Improving conditions in existing informal settlements in Latin American cities is a necessary and worthy goal, but the programs for "regularizing" these places have had mixed results so far, a new Lincoln Institute report says.

The two major approaches to regularization – legalizing parcels by awarding the occupants titles to the property as exemplified in Peru, and Brazil's broader approach that combines titling with extensive upgrading of public services – both fall short of expectations. Titling by itself is relatively inexpensive but has not triggered neighborhood improvements, while upgrading is much more costly and can stimulate additional irregular development by those hoping to benefit from future upgrading.

The lack of revenue associated with regularization has inhibited the scaling up of such programs.  Regularization programs can be more self-sustaining through property taxes and charges that capture some of the increases in land value caused by urban infrastructure and service improvements, according to Regularization of Informal Settlements in Latin America, the latest Policy Focus Report published by the Lincoln Institute of Land Policy.

"Customized, cost-effective, and sustainable approaches to upgrading have the potential to improve the lives of the many millions of people living in informal settlements," said Gregory K. Ingram, president of the Lincoln Institute, "but regularization is a work in progress, and we need to learn more about what works."

Legal recognition is increasingly seen as the only realistic remedy for informal settlements, as evictions and massive relocations to new public housing are neither tolerated nor economically feasible in most countries.  But "regularization programs need to be designed carefully to avoid either making conditions worse for the low-income residents the programs are intended to help, or stimulating the development of new informal settlements," said the report's author, Edesio Fernandes, a lawyer and international expert on regularization, who was a visiting fellow at the Lincoln Institute in 2008-2009.

The report first assesses the narrow legalization of tenure through titling, undertaken by Peru, an approach inspired by Hernando de Soto. From 1996 to 2006 Peru issued over 1.5 million freehold titles at an average cost of $64 per household. Brazil's broader regularization programs combining legal titling with the upgrading of public services, job creation, and community support initiatives, have cost $3,500 to $5,000 per household.

Regularization of Informal Settlements in Latin America, which will be translated into Spanish and Portuguese, recommends further evaluation and research, the use of appropriate titling systems (freehold, leasehold, cooperatives, land trusts, or communal ownership), and the participation of both men and women to avoid building gender bias in crafting policy and programs.

"While full regularization has proceeded slowly in most cases and most programs fall short of original expectations, cities in Latin America are finding that addressing informality on site is now a political imperative. Not engaging in regularization policies is no longer an option," said Martim O. Smolka, director of the Program on Latin America and the Caribbean at the Lincoln Institute of Land Policy. "The long-run challenge is to provide infrastructure and services in an affordable and sustainable manner, pre-empting illegal occupations."

The Lincoln Institute has long been concerned about how to address informality and its impacts. See The Lincoln Institute of Land Policy is a leading resource for key issues concerning the use, regulation, and taxation of land. Providing high-quality education and research, the Institute strives to improve public dialogue and decisions about land policy.

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SOURCE Lincoln Institute of Land Policy