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The excessively high price of serviced land in Latin America is one of several explanations for the extent and persistence of informal land markets. Contrary to popular beliefs, informality is expensive and therefore is not the best or even an advantageous alternative to combating poverty, but it is usually the only one available to the urban poor. A more consistent policy to reduce informality, and in so doing reduce poverty, should be at least neutral or contribute to reducing high land prices.
Poverty Alone Cannot Explain Informality
Although the map of illegality corresponds to a great degree with that of poverty, the extent and persistence of informality cannot be explained by poverty alone. Not all occupants of informal settlements are poor, as many empirical studies in Latin America have proved in recent years. The rate of new irregular land occupations is much higher than the rate of increase in the number of new poor families. In Brazil, for example, the total number of favela residents has increased at five times the rate of poor residents, and a similar trend is seen in most large Latin American cities.
This spectacular growth in informal settlements has occurred through expansion on the peripheries and densification in “consolidated” irregular urban areas, even though the birth rate and the number of rural-to-urban migrants have declined substantially and the percentage of poor citizens has remained relatively stable. Other explanations for this growth in informality include the lack of sufficient social housing programs, inadequate public investment in urban infrastructure for public amenities and services (such as drainage and sewage systems) and, last but not least, the reality that informal arrangements are profitable for those who promote them.
The High Cost of Serviced Land
Conventional economics argues that free market prices reflect the level at which a buyer’s ability and willingness to pay matches a supplier’s ability and willingness to sell, but in practice no assurance is given with respect to meeting social needs. That is, the market for serviced land may be functioning well, even though many families (even non-poor ones) are unable to access such land, and some existing urbanized lands are being kept vacant intentionally.
On the peripheries of many Latin American cities, the price of a square metre (m2) of serviced land made available by private agents can vary between US$32 and US$172. These figures are close in absolute terms to those found in cities in the developed world, where the per capita income is typically 7 to 10 times higher than in Latin America. Even a family above the poverty line saving up to 20 percent of its monthly wages (US$200) would need 12 to 15 years to save enough to acquire an urbanized plot of 150 m2. These indicators suggest that the difficulty of gaining access to serviced land may be one of the factors that actually contribute to poverty.
The price of serviced land, like prices in other markets, is determined by supply and demand. The supply of land depends on the amount that is newly serviced (produced) per year, the amount that is retained from the market, and the intensity of the use of the existing serviced land. The demand depends on the annual rate of formation of new households, adjusted by their income and/or purchasing power, their preferences and the prices of other items in their budgets. It is difficult to provide a full discussion of all factors affecting the behavior of land prices (see Smolka 2002), but it suffices to mention certain determinants that are emblematic to understanding some apparent idiosyncrasies of the functioning of urban land markets in Latin America.
On the supply side, property taxes, a major potential source of revenue to finance the production of serviced land, are ridiculously low. Typically property taxes represent less that 0.5 percent of GDP, compared to 3 to 4 percent in the U.S. and Canada. Overall there is a sense that Latin America underspends on infrastructure and services compared to its per capita GDP. The substantive observed land value increments resulting from investments in urban infrastructure and services are basically neglected as a revenue source to finance such investments, due to weak sanctions on capturing land value increments or simply holding improved land from the market (Smolka and Furtado 2001).
In addition, the disposition of considerable amounts of land is controlled by agents that do not follow strict economic rules (e.g., some public agencies, the Army, the Church or even state-owned enterprises like the railroads for whom some statutory restrictions preclude the disposition of land according to the market’s highest and best use criteria). Furthermore, the limited amount of available land that is fully serviced is often subject to overtly elitist urbanistic norms and regulations (zoning) designed to “protect” those serviced neighborhoods by making it difficult for low-income families to comply.
On the demand side, many families, even those with relatively high incomes, work in the informal sector and are excluded from the market because they lack the credentials required by financial agencies to apply for a loan. The need to self-finance housing production on a piecemeal basis through nontraditional funding sources extends the time between acquisition and occupation of land, thereby adding to both the cost of financing and the overall demand for land. Further, the legacy of high inflation, ill-developed or inaccessible capital markets, and limited participation in the social security system are responsible for nurturing a well-established culture and preference by lower-income sectors to use land as a reserve of value and as a popular means of capitalization, which also adds to the demand for land. In other words, holding undeveloped land and the culture of land speculation are not exclusive to high-income areas.
Prices for Informal Plots
Beyond these conventional arguments about supply and demand, one may also consider the dynamics or interdependency of formal and informal urban land markets as a factor contributing to high land prices. Specifically, the high prices for serviced land in the formal market seem to affect the relatively high prices of unserviced land in the informal market, and vice versa.
Land prices reveal the difference that the purchaser has to pay to avoid falling into a worse situation (that is, farther from work; fewer or worse services, lower environmental quality, and the like). Thus, if the “best” alternative is a plot in an unserviced settlement, one would expect a premium on the existing serviced land, which would also reflect the value of the legal title that comes with serviced land. On the other hand, if the minimum price for serviced land (raw land plus the cost of urbanization) is still unaffordable, then whatever land one could have access to would represent an alternative. This alternative could range from outright squatter settlement, to invasion through the mediation of “pirate” operators or organized movements (both of which involve fees and other payments), to the more prevalent land market for irregular subdivision of large parcels into small plots with inadequate services.
The price of land in the informal market is, therefore, higher than the price of raw land but normally less than the sum of the raw land price plus the cost of providing services. At the same time, it tends to be lower (though not necessarily on a per square-metre basis) than the minimum price of fully serviced and commercialized land in the formal market. In effect the market values more “flexible” means to access land, such as plots smaller than the minimum lot size, or construction without building codes, or even the possibility of selling the roof of a house as buildable space.
Most low-income families do not choose an informal arrangement because it provides the best price option, but simply because it is often their only option. The “choice” of acquiring an informal plot is still expensive. Conservative estimates obtained from an informal survey of 10 large Latin American cities show the average price of land on a commercialized illegal plot was US$27 for one square metre (see Table 1).
Table 1: Prices and Profitability of Informal and Formal Land Markets (US$)
1- Rural land designated for urban use
Informal market: $4
Formal market: $4
2- Cost of urbanization
Informal market: minimal = $5
Formal market: full = $25
3- Final price in the market
Informal market: $27
Formal market: $70
4- Profit over advanced capital=(3-1-2)/(1+2)
Informal market: 200%
Formal market: 141%
The profit figure (4) explains at least in part the question (an apparent paradox): Why, in spite of a significant mark-up in the provision of urbanized land in the informal market, does one find so little interest in development from the private sector? As Table 1 indicates, the provision of informal land is more profitable than the provision of formally developed land. In fact, the figures for the formal market are largely underestimated since there are higher risks associated with financial, security and marketing costs, and other costs borne by the developer that are not incurred in informal developments. These data also help explain why formality begets informality and exposes the fact that the advantages of informal arrangements are not necessarily perceived by the low-income occupants, but by the subdivider or informal developer.
Unexpected Effects of Regularization
Let us turn now to the question of policy responses to this state of affairs. Given the apparent impossibility or impracticality of adopting any other policy, the prevailing notion has been that tolerating informal “solutions” to gain access to land and then regularizing the settlements after they are established is cheaper in the long run for public finances, and better for the low-income occupants (Lincoln Institute 2002).
The public finance argument claims that the existing arrangement is cheaper because it capitalizes on private (self-) investments in the consolidated settlements, thus relieving public agencies of social responsibility and expenditures otherwise associated with one’s full “right to the city.” This view is questionable on two accounts. First, the physical conditions and existing housing are often unacceptable as human shelter, in spite of the ingenuity and imagination of informal solutions under extremely unfavorable conditions. The poor standards of land use and density in these settlements are only tolerated because the damage has already been done. Second, with regard to infrastructure, some of the alternative technologies that look promising are ultimately shown to perform poorly and to require overly expensive maintenance.
The impacts on low-income occupants are also worse than expected. Not only are land prices much too high but there are additional costs: those without an official address (because they live in an irregular settlement) are often discriminated against when looking for a job or social services; rents as a percentage of property value are higher than the rates observed in the formal market; access to water from a truck or other temporary source is much more expensive than piped water; and the cost of insecurity is greater because of living in a more violent environment.
Regularization policies evaluated in a broader urban context may actually contribute to aggravating the problem it is supposed to remedy. That is, as a curative approach these policies may instead have perverse or counter-productive preventative effects, as noted below.
Price Signals
The expectation that an area of land will eventually be regularized allows the developer to raise the price. A purchaser often obtains a lot with written evidence that the developer does not yet have the services required by urban planning norms. At the same time the developer promises that as soon as enough lots are sold the services or infrastructure will be provided, even though such promises are often unfulfilled. At best, a relationship of complicity is established between buyer and seller. At worst, and this is quite common, the purchaser is tricked by the existence of services, such as pipes put into the ground, which the developer claims are part of the infrastructure network. Other problems in these arrangements that can harm poor residents are doubtful rights of tenure, payment terms that disguise the full amount of interest to be paid, and confusing or inaccurate details in the contract.
As in any other segment of the land market, the actual prices reflect, or absorb, expectations about the future use of the lot. The informal sector is no exception. The greater the expectation that the plot of land that is currently without services will get them eventually, either from the developer or, as is more likely, from the government through some regularization program, the higher the price at which the land is sold.
Regularization as an Attraction for More Irregularity
Research on the first arrival dates of inhabitants in informal settlements suggests that in many cases more people moved in just when some regularization program (such as the granting of titles or urbanization improvements) was announced or implemented (Menna Barreto 2000).
The idea that expectations about regularization have an effect on informality is also corroborated by the large number of invasions or occupations that take place either just before or just after electoral periods, when candidates promise new regularization programs. The victory of Miguel Arraes as governor of Pernambuco, Brazil, in 1986 led to 13 land invasions in just over a month (Rabaroux 1997, 124), and the Latin American historiography of the effects of the expectations created by populist promises is rich in other examples. Many of the existing settlements that need to be regularized today owe their origin to the irresponsible complacency of politicians turning a blind eye to the irregular occupation of public or unsuitable areas, or, which is worse, who ceded public land for electioneering purposes.
The Opportunity Costs of Regularization
Regularization programs, which are normally of a remedial or curative nature, have a high opportunity cost compared to the cost of providing urbanized land in a preventative manner. The rule of thumb cost per benefited family of a typical upgrading or regularization program has been in the range of $3,000 to $4,000. Taking the size of a plot to be around 50 m2 and adding 20 percent to account for streets and other public services, the cost works out to US$50 to US$70 per m2. This is considerably higher than the cost for servicing new land, which is less than US$25 per m2, and is similar to the price charged by private developers, even when allowing for a handsome profit margin. ECIA, a private developer operating west of Río de Janeiro, offered completely urbanized plots for US$70 to US$143 per m2 at 1999 prices (Oliveira 1999). The Municipal Secretariat of Urbanism in Río de Janeiro has a technical study, from 1997, which demonstrates that it is possible to commercialize urbanized plots for less than US$55 per m2. Along the same lines, Aristizabal and Gomez (2001) in Bogotá estimate that the cost of correction (“reparation”) of an irregular settlement is 2.7 times the cost of planned areas.
These figures suggest the limitations of preventative programs in favor of curative ones. It is also relevent that permission to develop a regular, formal subdivision may take from three to five years, whereas the decision to regularize an informal settlement often takes less than six months.
The “Day After” of Regularization
A well-executed regularization program (that is, one that effectively integrates the informal area with the urban fabric) would ideally result in the improved quality of life for all occupants and a stronger community. In particular, one would expect an appreciation of property values, causing some residential mobility as families with below-average incomes are forced to move. However, when the program is badly executed the area may be consolidated as a low-income irregular settlement.
The Favela-Bairro upgrading program in Rio de Janeiro is often used to exemplify the most comprehensive and successful experience of its kind. Abramo’s (2002) study of the impact of regularization programs found a relatively small increase in property values in the affected areas (28 percent). Applying this average figure to typical or modest houses with an ex-ante value estimated at US$12,000, the added value is about US$3,400, a number close to the average per-family cost of regularization programs. This result contrasts with the mark-up of more than 100 percent obtained in the process of servicing raw land through the market by private agents. This intriguing piece of information seems to show how little notice the “market” takes of the increased value of these regularized settlements. At the same time, full integration into the urban fabric turns out to be less frequent than had been expected. Many of the favelas that received important upgrading investments remain stigmatized as favelas even 15 years later.
Conclusions
Informality is expensive, and it exacerbates the conditions of living in poverty. The diagnoses of such agencies as the UNCHS (Habitat), World Bank, Inter-American Development Bank and others would seem to be correct in regarding upgrading programs as an essential ingredient of any policy to deal with urban poverty. However, because of the piecemeal and limited approach of such programs, there is no guarantee that the regularization of settlements alone will contribute to reducing urban poverty. In effect these programs not only reiterate and keep intact the land market “rules of the game” that contribute to informality, but they also generate some perverse effects. This situation poses both a dilemma and a challenge. The dilemma is that not regularizing simply is not a political option (nor is it a humanitarian option). The challenge is how to interrupt the vicious cycle of poverty and informality through interventions in the land market. The task ahead is formidable, but there are places in Latin America where local governments are beginning to set new ground rules.
Martim O. Smolka is senior fellow and director of the Program on Latin America and the Caribbean at the Lincoln Institute.
References
Abramo, Pedro. 2002. Funcionamento do mercado informal de terras nas favelas e mobilidade residencial dos pobres. Cambridge, MA: Lincoln Institute of Land Policy Research Paper.
Aristizabal, Nora, and Andrés Ortíz Gomez. 2002. Are services more important than titles in Bogotá?” in Land, Rights and Innovation: Improving Tenure Security for the Urban Poor, Geoffrey Payne, ed. 100-113. London: Intermediate Technology Development Group Publishing.
Lincoln Institute. 2002. Access to Land by the Urban Poor: 2002 Annual Roundtable. Cambridge, MA: Lincoln Institute of Land Policy.
Menna Barreto Silva, Helena. 2000. Programas de urbanização e desenvolvimento do mercado em favelas brasileiras. São Paulo: University of São Paulo: LAB-Hab.
Oliveira, Fabrício L. de. 1999. Valorização fundiária e custos de urbanização na XVII R.A. – Campo Grande: uma primeira aproximação com o caso do Rio de Janeiro. Cambridge, MA: Lincoln Institute of Land Policy Research Paper.
Rabaroux, Patrice. 1997. La Regularizacion en Recife (Brasil). In El acceso de los pobres al suelo urbano. Antonio Azuela and François Tomas, eds. México: Centro de Estudios Mexicanos y Centroamericanos del Instituto de Investigaciones Sociales de la UNAM.
Smolka, Martim O. 2002. The High and Unaffordable Prices of Serviced Land. Cambridge, MA: Lincoln Institute of Land Policy Research Paper.
Smolka, Martim O., and Fernanda Furtado, eds. 2001. Recuperación de plusvalías en América Latina: Alternativas para el desarrollo urbano. Santiago, Chile: EURELIBROS.
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Una versión más actualizada de este artículo está disponible como parte del capítulo 7 del CD-ROM Perspectivas urbanas: Temas críticos en políticas de suelo de América Latina.
Durante la última década, el autobús de transporte rápido (BRT, por sus siglas en inglés) ha revolucionado la planificación del transporte regional en gran parte del mundo desarrollado y en vías de desarrollo. El BRT pasó de ser una opción de transporte marginal utilizada en unas pocas ciudades de Brasil y Australia a convertirse en una importante alternativa de transporte masivo para los gobiernos locales y nacionales.
El BRT no es un concepto único, sino que engloba una variedad de aplicaciones diseñadas para mejorar el nivel de servicio que proporciona el transporte masivo en autobús ofreciendo movilidad de forma económica y cómoda, similar a la que ofrece el ferrocarril urbano (Wright y Hook 2007, 11). Se basa en mejoras coordinadas en tecnología, infraestructura y equipamiento para conseguir un servicio de calidad (Oficina General de Cuentas de los Estados Unidos 2001). Desde el punto de vista operativo, las aplicaciones del BRT incluyen autobuses con derecho de paso exclusivo, con estaciones dedicadas y abono de tarifas previo al abordaje, o autobuses que transitan por carriles de tráfico mixtos en las principales arterias de la ciudad.
Podría afirmarse que el concepto del BRT que goza del mayor reconocimiento es la provisión de un derecho de paso exclusivo para el transporte en autobús unido a la alta frecuencia del servicio. En Sudamérica, los sistemas BRT de Curitiba, en Brasil, y Bogotá, en Colombia, integran redes de carriles dedicados al uso exclusivo de autobuses articulados de gran capacidad, con embarque y desembarque rápido.
Doce ciudades latinoamericanas, tres australianas, siete estadounidenses, ocho asiáticas y dieciocho europeas han implementado sistemas BRT. En algunas los sistemas son completos mientras que en otras son líneas únicas. También hay sistemas actualmente en construcción en todo el mundo, como en Dar es Salaam en Tanzania, Jinán en China, Bolonia en Italia, Mérida en Venezuela y Auckland en Nueva Zelandia. En marzo de 2007, GTZ, la empresa federal de desarrollo de Alemania, estimó que había al menos 27 ciudades con procesos activos de planificación de sistemas BRT, mientras que 14 sistemas estaban considerando su ampliación (Wright y Hook 2007).
El extraordinario éxito del BRT se debe en parte a la relación costo-efectividad y a la relativa flexibilidad de la inversión necesaria. Los sistemas BRT a menudo pueden transportar tantos pasajeros como los sistemas de ferrocarril urbano convencionales pero por una fracción del costo. Los sistemas BRT también son comparables a los sistemas de ferrocarril tipo metro, excepto en situaciones de muy alta demanda de pasajeros, superior a los 50.000 pasajeros por sentido y por hora. Igual que en el ferrocarril urbano, no obstante, la relación costo-efectividad del BRT se apoya en la capacidad de disponer de usos del suelo que concentran la actividad a lo largo de corredores del sistema. Por lo tanto, en la mayoría de los casos, los sistemas BRT se han construido en corredores con una demanda comprobada.
INVERSIÓN EN TRANSPORTE Y URBANIZACIÓN/REURBANIZACIÓN DEL SUELO
También resulta plausible que los sistemas BRT puedan atraer una urbanización densa que a su vez mejore el sistema BRT en el futuro. Esta conexión recíproca entre inversión en BRT y urbanización ha sido el puntal del éxito en Curitiba. A pesar de la importancia de esta conexión para la viabilidad futura y la relación costo-efectividad de los sistemas BRT, aún disponemos de poca evidencia empírica. Dado el elevado número de ciudades que están considerando la construcción de nuevas líneas BRT o la ampliación de sus sistemas, resulta crucial comprender si se producirán cambios en la urbanización del suelo a fin de prever los beneficios del sistema y poder estimar el impacto fiscal de la inversión.
La teoría económica urbana proporciona un punto de partida para explicar cómo la inversión en transporte puede influir en la urbanización o reurbanización del suelo. Se espera que tal inversión proporcione beneficios de accesibilidad a quienes se ven afectados positivamente a través de la disminución del tiempo de desplazamiento que les brinda la inversión.
En un mercado del suelo metropolitano, se espera que la inversión en transporte proporcione ventajas en cuanto a accesibilidad a los terrenos cercanos a la inversión en comparación con los terrenos relativamente poco afectados por dicha inversión. Puesto que el número de terrenos que se benefician de las mejoras de accesibilidad es limitado, se espera que las familias y las empresas que valoren tales beneficios en un mercado competitivo estén dispuestas a pagar más por las propiedades que ofrecen buen acceso que por otras propiedades, suponiendo que las demás condiciones son iguales. En este sentido, los beneficios de acceso que ofrecen las inversiones en transporte, de existir, se capitalizarán en el valor de las propiedades.
La capitalización de los beneficios de accesibilidad estimula la urbanización potenciando el atractivo de los terrenos para su urbanización o reurbanización. Los terrenos que anteriormente no eran considerados candidatos preferenciales para la inversión inmobiliaria se tornan más atractivos después del anuncio o implementación de la inversión en transporte. Por otro lado, un terreno ya urbanizado o en fase de planificación puede urbanizarse más intensivamente como resultado del aumento de valor. Esta relación es la piedra angular de la urbanización enfocada hacia el transporte (ver la Figura 7.5.3.1 en anexo).
Además del potencial urbanizable propiciado por la inversión en transporte, los aumentos en el valor del suelo también son relevantes para las finanzas municipales y la financiación de proyectos específicos. El éxito de instrumentos locales como la financiación mediante incrementos impositivos (Tax Increment Financing, o TIF) y la recuperación de plusvalías depende del valor del suelo y de los cambios de urbanización asociados al proyecto.
EL SISTEMA TRANSMILENIO DE BOGOTÁ
Bogotá, la capital de Colombia, tiene aproximadamente 6,8 millones de habitantes que ocupan aproximadamente 29.000 hectáreas de suelo urbanizado (Alcaldía Mayor de Bogotá 2003). Antes de TransMilenio, todo el transporte público de Bogotá lo proporcionaban choferes de autobús privados organizados en empresas o asociaciones, las cuales añadían o cancelaban servicios con poca supervisión por parte del gobierno. Los ingresos para los choferes del autobús estaban basados exclusivamente en las tarifas pagadas por los pasajeros, lo que provocaba una intensa competencia entre los conductores. Este marco operativo tuvo un costo social considerable, en congestión, calidad inadecuada y falta de seguridad (debido a la escasa inversión en mantenimiento de los vehículos). En 1999 los residentes experimentaban velocidades medias de desplazamiento en los autobuses de sólo 9 km/h durante el período de máxima actividad del día.
A finales de la década de 1990, preocupado por una oferta excesiva de capacidad del transporte, malas condiciones ambientales y de seguridad y velocidad decreciente de los autobuses, el gobierno municipal invirtió en una amplia red BRT, pero ésta cubría únicamente las zonas con alta demanda de transporte público. Las zonas de la ciudad donde no llegaba el BRT continuaron servidas por las asociaciones originales, y siguieron sufriendo el efecto medioambiental y de tiempo. La inversión en BRT, TransMilenio, formaba parte de una estrategia integrada más amplia para abordar los problemas de movilidad, reclamar los espacios públicos para los peatones y aumentar el acceso a zonas verdes.
TransMilenio se ha implementado en dos fases, con una tercera fase actualmente en proceso de diseño. La primera fase se planificó en 1998, se construyó en 1999–2000 y entró en funcionamiento en diciembre de 2000 en dos corredores. La segunda fase, que comenzó a funcionar a finales de 2003, añadió tres corredores más de forma paulatina. Todas las fases se han implementado a través de un exitoso acuerdo entre entidades públicas y privadas: el gobierno financia la infraestructura y supervisa las funciones de planificación a largo plazo, y las empresas privadas licitan la operación de conjuntos de rutas o zonas de influencia.
El sistema comprende una infraestructura especializada, que incluye carriles exclusivos para ofrecer una capacidad de alto servicio, estaciones de embarque cerradas y una flota racionalizada de autobuses articulados con sistema de cobro de tarifas en plataforma previo al embarque. Un servicio coordinado con rutas alimentadoras permite acceder a TransMilenio desde vecindarios alejados de la ruta del autobús. A noviembre de 2007, el sistema tenía 114 estaciones, operaba más de 1.000 autobuses y realizaba más de 1,4 millones viajes en sentido único por día a una velocidad media de 27 km/h.
Considerado como un excelente ejemplo de sistema BRT, el caso de Bogotá ilustra la transformación de corredores de transporte tradicionales afectados de una seria contaminación, problemas de seguridad y un entorno poco atractivo en un nuevo sistema que ofrece tiempos de desplazamiento considerablemente menores, menos ruido y menos emisiones de gases de efecto invernadero (Cain y col. 2006).
IMPACTO DE TRANSMILENIO SOBRE EL VALOR DEL SUELO
TransMilenio ha sido el centro de atención de al menos cuatro estudios que relacionan el valor del suelo con el sistema BRT (ver recuadro en anexo). Aunque la evidencia hasta la fecha sobre la relación entre TransMilenio y el valor de las propiedades inmobiliarias ha resultado útil, su capacidad para influir en las políticas sigue siendo limitada. Por ejemplo, estos estudios se basan en datos transversales, por lo que resulta imposible identificar si el sistema BRT produjo el cambio en el valor del suelo, o si los planificadores fijaron las estaciones en lugares que ya eran bien valorados por los residentes. Asimismo, a pesar del interés por parte de los gobernantes en ampliar los sistemas BRT establecidos y en buscar formas de financiarlos, ningún estudio ha examinado si estas ampliaciones traen beneficios a las propiedades que ya disfrutaban del servicio del BRT.
Utilizando los datos sobre los precios pedidos por las propiedades anteriores y posteriores al TransMilenio, examinamos si los precios cambiaron a medida que se ampliaba el sistema. Comprender en qué medida han cambiado los precios en Bogotá es particularmente importante dada la extensa experiencia del gobierno colombiano con los instrumentos de recuperación de plusvalías del suelo y el aumento del interés por encontrar nuevas fuentres de financiación para futuras ampliaciones del BRT (Furtado 2000).
Nuestros datos se tomaron de una muestra de propiedades en la zona metropolitana de Bogotá entre 2001 y 2006. La fase II de la ampliación del TransMilenio, abierta al público en diciembre de 2003, proporcionó el escenario del estudio. En el análisis utilizamos propiedades unifamiliares ubicadas en un radio de 1 km del sistema BRT que se beneficiaron de la ampliación del sistema de una o dos formas: obteniendo acceso local a TransMilenio gracias a la ampliación, u obteniendo acceso regional gracias al mayor alcance de la red, lo que denominamos “efecto de la red”.
Para medir los efectos de la red utilizamos propiedades que anteriormente sólo tenían acceso local a una estación de TransMilenio, pero que ahora se benefician del mayor alcance del sistema BRT. Por otro lado, las propiedades que no tenían acceso local a TransMilenio antes de diciembre de 2003, pero que también se beneficiaron de la ampliación, sirvieron para examinar los efectos del acceso local (ver Figura 7.5.3.2 en anexo).
Todas las propiedades susceptibles de verse afectadas por TransMilenio se consideran pertenecientes a zonas de intervención de acceso local o del efecto de la red. Sin embargo, puesto que los valores de las propiedades cambian de antes a después de la intervención por razones diferentes a los cambios producidos por TransMilenio, también incluimos propiedades dentro de una zona de control que no se benefició directamente de ninguna de las inversiones de TransMilenio, ni de otras inversiones en rutas para bicicleta o en parques importantes.
La estadística descriptiva simple tanto de ambas zonas de intervención como de la zona de control muestra que las propiedades dentro de la zona de efecto de la red eran más caras que las situadas en las otras dos zonas, tanto antes como después. Las propiedades de la zona de acceso local tenían precios similares a las de la zona de control, antes y después. Asimismo, los precios pedidos aumentaron en índices diferentes. Respecto de las propiedades dentro de la zona de efecto de la red, los precios aumentaron un 5,1 por ciento, en comparación con un 9,5 por ciento para las propiedades dentro de la zona de acceso local y un 7,7 por ciento para las situadas en la zona de control durante el mismo período. No obstante, estas diferencias pueden resultar engañosas, porque las propiedades ofrecidas en el mercado pueden haber sido diferentes antes y después de la intervención.
Por ejemplo, la zona de control tenía un índice considerable de usos industriales (22,7 por ciento) y terrenos vacantes (14,1 por ciento) comparada con las otras dos (zona de efecto de la red: 0,5 por ciento de uso industrial y 0,8 de terrenos vacantes; zona de acceso local: 13,7 por ciento de uso industrial y 7,0 por ciento de terrenos vacantes), aunque la densidad de población es similar. Las zonas de acceso local y de control tienen poco o ningún uso comercial, mientras que la zona de efecto de la red tiene una mezcla más homogénea de usos residenciales y comerciales. Por tanto, fue necesario un análisis de regresión para ayudar a aislar la variación de precio identificada de los efectos de la presión inflacionista, las diferencias en la oferta de vivienda o el efecto de la ampliación de TransMilenio sobre el precio de la vivienda. Nuestros modelos corrigieron además la correlación existente para las propiedades que están más juntas desde el punto de vista espacial, con respecto a las que están más distantes.
Cambios en el valor de las propiedades en las zonas con servicio BRT
Los hallazgos de nuestro modelo de regresión para la zona de efecto de la red con respecto a la zona de control mostraron una evidencia uniforme de que los precios en 2001 y 2002 eran similares entre la zona de intervención y la zona de control, sin que se produjera una apreciación. Sin embargo, detectamos una apreciación positiva uniforme en la zona de intervención desde el año 2003 en adelante, con respecto a la zona de control.
Los precios pedidos por las propiedades resultantes según las estimaciones se muestran en la Figura 7.5.3.3 (en anexo), creada mediante una simulación basada en coeficientes estimados y en su matriz de varianza-covarianza. Los valores representan una propiedad de entre 10 y 20 años de antigüedad, con todas las demás variables establecidas en sus valores medianos, variando el año de 2001 a 2006.
Las propiedades de la zona de intervención se apreciaron antes y en mayor grado que las propiedades de la zona de control. La Figura 7.5.3.4 (en anexo) muestra el cambio en los precios entre la zona de intervención y la zona de control en términos de porcentaje. El pico de precios de 2003 en la zona de intervención puede ser el resultado de la previsión de los propietarios ante la expectativa de apertura de la ampliación del sistema BRT, o de otros cambios en el submercado inmobiliario que nuestras variables no tuvieron en cuenta. Aunque se han documentado efectos similares de previsión de extensión de transporte masivo en otros lugares (Knaap, Ding y Hopkins 2001), no se ha examinado ni documentado ninguno de ellos para los efectos de la red que crean dichas ampliaciones.
Cambios en el valor de las propiedades en las zonas sin servicio del BRT
Los hallazgos de nuestro modelo de regresión para la zona de acceso local con respecto a la zona de control arrojaron una evidencia mixta de aumento de los precios en zonas que anteriormente no estaban servidas por el sistema BRT. En algunos casos (dependiendo del modelo especificado) los precios en la zona de intervención eran superiores a los de la zona de control para las propiedades ofertadas en 2001, 2003, 2004 y 2006. Otros modelos mostraron relaciones menos consistentes. Una prueba de los coeficientes correspondientes al período anterior y del coeficiente del período posterior no muestra una diferencia simultánea en los precios de las propiedades.
EL RESULTADO NETO: TRANSMILENIO Y LOS VALORES DE LAS PROPIEDADES
En general nuestros resultados dibujan un panorama mixto de apreciación como consecuencia de las ampliaciones del BRT. Por un lado, la evidencia sugiere la apreciación de las propiedades que ya estaban servidas por el BRT, puesto que también se beneficiaron de las ampliaciones. La plusvalía estimada del precio pedido por las propiedades se sitúa entre el 15 y el 20 por ciento, aunque la apreciación comenzó un año antes de inaugurarse la ampliación. Esto resulta significativo, dado que sabemos poco acerca de la magnitud potencial de estos efectos. En contraste, encontramos poca evidencia de aumento de los precios de las propiedades situadas a lo largo del corredor que anteriormente no tenía una estación local de BRT, pero que ahora recibe servicio gracias a la ampliación.
No podemos afirmar sin lugar a equívocos que los aumentos de precio fueron el resultado de la ampliación del BRT, porque podrían deberse a variaciones en el submercado inmobiliario local. Por ejemplo, la ciudad de Bogotá resurgió de una profunda recesión que terminó a principios de 2000. Si los efectos de la recesión no fueron uniformes en todos los vecindarios, es posible que eso explique el diferencial encontrado. Además, es posible que las propiedades que ya disfrutaban del servicio del BRT simplemente estaban capitalizando los beneficios de la inversión original realizada apenas cuatro años antes.
Otras explicaciones posibles de los resultados que quizá interesen a los planificadores que estén considerando hacer inversiones en BRT incluyen la cronología de los efectos. La capitalización de los beneficios de las ampliaciones del BRT puede tardar tiempo en materializarse. Nuestro análisis cubre solamente hasta tres años después de la inauguración de la ampliación, pero el impacto de los proyectos de transporte tiende a tardar más tiempo. Una explicación relacionada es que las propiedades también se aprecian ante la expectativa de la inversión en transporte, más que cuando se inauguran las ampliaciones.
También es posible que los efectos difieran en los vecindarios de cada zona estudiada. Aunque utilizamos propiedades en un radio de 1 km de una estación de BRT (la zona de influencia identificada por los planificadores locales en sus estudios de viabilidad de TransMilenio), es posible que los precios aumentaran, pero sólo para un subconjunto de propiedades (por ejemplo, las más próximas a una estación). Por último, es probable que el efecto sobre el valor del suelo derivado de la inversión pública en transporte sea diferente para las propiedades comerciales, las viviendas unifamiliares y las multifamiliares. Se han detectado aumentos en el precio de los espacios comerciales en otras ciudades (Cervero y Susantono 1999; Cervero y Duncan 2002).
No existe una forma sencilla de examinar sin ambigüedades los efectos sobre el valor del suelo derivados de la inversión pública en transporte. En este estudio, hemos intentado profundizar en el tema sobre la base de otros estudios y superar sus limitaciones. Nuestras conclusiones revelan una cierta promesa para la financiación de infraestructura a través de las plusvalías que puede crear. Pero perduran ciertas ambigüedades y advertencias que no son fáciles de resolver. Mientras tanto, los encargados de tomar decisiones seguirán explorando soluciones para las opciones de transporte masivo y las formas de financiarlas, y el sistema BRT contribuirá a abordar la acuciante necesidad de movilidad en las ciudades de todo el mundo.
Referencias
Alcaldía Mayor de Bogotá. 2008. Población por localidad. Alcaldía Mayor de Bogotá 2003. http://www.bogota.gov.co/galeria/cifraspoblaciondelocalidades1973a2003.pdf
Cain, A., G. Darido, M. R. Baltes, P. Rodríguez, and J. C. Barriors. 2006. Applicability of Bogotá’s TransMilenio BRT system to the United States. Tampa, FL: National Bus Rapid Transit Institute.
Cervero, R., and M. Duncan. 2002. Transit’s value-added: Effects of light and commuter rail services on commercial land values. Transportation Research Record 1805:8–15.
Cervero, R., and B. Susantono. 1999. Rent capitalization and transportation infrastructure in Jakarta. Review of Urban and Regional Development Studies 11 (1):11–23.
Furtado, F. 2000. Colombia: Economic aspects of the country’s land use. American Journal of Economics and Sociology, 59 (5):97–110.
Knaap, G. J., C. R. Ding, and L. D. Hopkins. 2001. Do plans matter? The effects of light rail plans on land values in station areas. Journal of Planning Education and Research 21 (1):32–39.
Mendieta, J. C., and J. A. Perdomo. 2007. Especificación y estimación de un modelo de precios hedónico espacial para evaluar el impacto de Transmilenio sobre el valor de la propiedad en Bogotá. Bogotá, Colombia: CEDE.
Munoz-Raskin, R. 2006. Walking accessibility to bus rapid transit in Latin America: Does it affect property values? The case of Bogotá, Colombia. In TRB 86th Annual Meeting Compendium of Papers CD-ROM.
Perdomo, J. A., J. C. Mendieta, C. A. Mendoza, and A. F. Baquero. 2007. Investigación sobre el impacto del proyecto de transporte masivo Transmilenio sobre el valor de las propiedades en Bogotá, Colombia. Cambridge, MA: Lincoln Institute of Land Policy.
Rodríguez, D.A., and C. Mojica. 2008. Capitalization of BRT network effects into land prices. Working paper. Cambridge, MA: Lincoln Institute of Land Policy.
Rodriguez, D. A., and F. Targa. 2004. Value of accessibility to Bogotá’s bus rapid transit system. Transport Reviews 24 (5):587–610.
U.S. General Accounting Office. 2001. Bus rapid transit shows promise. Washington, DC: General Accounting Office.
Wright, L., and W. Hook. 2007. Bus rapid transit planning guide. New York: Institute for Transportation and Development Policy.
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Más que cualquier otra variable, el cambio en los valores del suelo a través del tiempo y del espacio brinda una perspectiva importante sobre la evolución de la estructura espacial de una ciudad. Mientras que la venta normal de una propiedad refleja el valor combinado del suelo y los edificios, el valor del suelo solo representa el valor real de una ubicación y sugiere expectativas sobre su futuro. Incluso si una parcela soporta la carga de un edificio anticuado, el precio del suelo refleja el valor actual descontado del flujo de retorno a la inversión que se podría obtener con un uso más intenso y óptimo de la parcela. El aumento rápido del precio del suelo en un área de la ciudad es una indicación clara de que la gente espera una alta demanda en el barrio durante un período de tiempo, lo cual es señal de oportunidades de inversión para los emprendedores inmobiliarios. Los cambios en el valor del suelo también pueden advertir a funcionarios municipales que es necesario efectuar cambios de zonificación e inversiones de infraestructura en una determinada área.
El valor del suelo es también un componente importante en el método de valuación de propiedades por costo, que es uno de los tres métodos utilizados comúnmente (junto con la comparación de ventas y el nivel de ingreso). El método de costo tiene tres componentes principales: (1) el costo de edificar la infraestructura existente como si fuera nueva en el momento de la tasación; (2) la depreciación del edificio a su condición actual; y (3) el precio de la parcela de suelo. Si se suma (1) a (3) y se resta (2), en general se obtiene una buena estimación del valor total de la propiedad. En las transacciones estándar de propiedades, sin embargo, no se pueden separar fácilmente el valor del suelo del valor de las estructuras. Las ventas de suelo vacante, que pueden indicar con mayor claridad el valor de un sitio, son relativamente raras en áreas urbanas grandes y edificadas, y por lo tanto hay pocos estudios existentes de ventas de suelo vacante (ver Ahlfeldt y Wendland 2011; Atack y Margo 1998; Colwell y Munneke 1997; Cunningham 2006). A veces se pueden usar las demoliciones para medir los valores del suelo, ya que cuando el edificio existente se demuele inmediatamente después de una venta, el suelo representa el valor total de la propiedad (McMillen 2006; Dye y McMillen 2007). No obstante, las demoliciones se tienden a concentrar en ciertos barrios de alto valor, y puede ser difícil obtener datos sobre demoliciones.
De todas las ciudades de los EE.UU., Chicago tiene la fortuna de contar con una fuente de datos, el Libro azul de valores del suelo de Chicago (Land Values Blue Book of Chicago) de Olcott, que reporta las estimaciones de los valores del suelo por cada manzana de la ciudad y por manzanas de muchos suburbios del condado de Cook durante la mayor parte del siglo XX. Olcott proporciona datos críticos para el procedimiento de tasación por costo. Después de determinar el costo y depreciación del edificio, el valor total de una propiedad se puede estimar multiplicando el tamaño de la parcela por el valor del suelo proporcionado en la serie del Libro azul. Este artículo se basa en un muestreo de datos de los volúmenes de Olcott (recuadro 1). Incluye una serie de mapas que proporcionan una imagen clara de la evolución espacial de Chicago durante el siglo XX, similar en espíritu al libro clásico Cien años de valores del suelo en Chicago (One Hundred Years of Land Values in Chicago) (Hoyt 1933).
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Recuadro 1: Fuentes de datos para los valores del suelo en Chicago
El Libro azul de valores del suelo de Chicago (Land Values Blue Book of Chicago) cubre la ciudad y gran parte del condado suburbano de Cook con una serie de 300 mapas, cada uno impreso en una página del libro. A la ciudad propiamente dicha se le dedican 160 mapas individuales con un impresionante nivel de detalle. La mayoría de lotes que dan a la calle tienen un valor que representa el precio por pie cuadrado para un lote estándar de 125 pies de profundidad. También se indica el uso dado al suelo. Los lotes grandes y la mayoría de los suelos industriales tienen precios cotizados por acre (0,4 hectárea), u ocasionalmente por pie cuadrado (0,98 m2, para una profundidad de lote sin especificar. Los datos representan los valores del suelo para cuadrículas de 1/8 x 1/8 de milla (alrededor de 200 x 200 metros), que siguen de cerca la disposición de las calles de Chicago y por lo tanto se asemejan a manzanas urbanas. El conjunto de datos de cada año incluye 43.324 observaciones para toda la ciudad.
El Lincoln Institute of Land Policy ha proporcionado financiamiento para digitalizar los datos contenidos en el Libro azul de Olcott para una serie de años que cubre gran parte del siglo XX: 1913, 1926, 1932, 1939, 1949, 1961, 1965, 1971, 1981 y 1990. Se presenta una descripción más minuciosa del procedimiento en Ahlfeldt et al. (2011). La digitalización de mapas consiste en incorporarlos a un entorno SIG. Se calculan los valores promedio del suelo para cuadrados de 1/8 x 1/8 de milla (alrededor de 200 x 200 metros) superpuestos sobre los mapas. El conjunto completo de datos tiene más de 600.000 puntos para cada uno de los 10 años.
El libro de Olcott se dejó de publicar a comienzos de la década de 1990, y el último año de datos digitalizados es 1990. Para suplementar los registros de Olcott en años recientes, los autores obtuvieron datos de todas las ventas de suelo vacante en la ciudad entre 1980 y 2011. Se geocodificaron exitosamente más de 16.000 ventas, las cuales demuestran el enorme aumento en los precios del suelo durante el período anterior al colapso del mercado inmobiliario al final de 2006. Estos conjuntos combinados de datos brindan una oportunidad única para analizar el cambio de estructura espacial de una ciudad completa durante un período de tiempo prolongado.
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Variación espacial en los valores del suelo
A pesar de su terreno plano, Chicago nunca fue una ciudad verdaderamente monocéntrica. El lago Michigan ha sido siempre una atracción, dado su valor panorámico, su efecto de moderación climática y la serie de parques que lo bordean. El río Chicago también ha tenido una influencia significativa sobre la ubicación de comercios y residencias. El desarrollo al norte del Distrito Comercial Central (Central Business District, o CBD) se demoró porque los puentes sobre el brazo principal del río se tenían que abrir con tanta frecuencia para dejar pasar el tráfico fluvial que el viaje a la zona comercial del Loop (bucle del tren elevado) era impredecible y largo. Los brazos norte y sur del río atrajeron tanto compañías industriales como desarrollos residenciales de bajo precio para los obreros, al tiempo que repelían las viviendas de alto precio diseñadas para los trabajadores del CBD. La ubicación de las calles principales, carreteras y líneas ferroviarias también tuvo un efecto significativo sobre los patrones de desarrollo. Por tanto, existen muchas razones para esperar una variación en la tasa de cambio en los valores del suelo a través de la ciudad.
Los mapas de la figura 1 (página 20) muestran esta variación espacial en los valores del suelo en Chicago a lo largo del tiempo. En 1913, los valores del suelo eran mayores en la gran zona que rodeaba el CBD y también eran bastante altos a lo largo del lago y algunas de las avenidas principales y bulevares que irradiaban de la zona céntrica. En 1939, este patrón era generalmente similar, junto con el crecimiento del lado norte en relación al lado sur de la ciudad. Los valores del suelo eran muy altos a lo largo de la ribera norte del lago, extendiéndose bien hacia adentro en la zona norte. El área del borde de la ciudad al oeste del CBD (el barrio de Austin) también tenía valores del suelo relativamente altos en 1939.
Para 1965, el patrón de valores del suelo había cambiado notablemente. Los valores del suelo muy altos estaban confinados a un área relativamente pequeña del CBD. El área de valor alto del barrio occidental de Austin era mucho más pequeña en 1965 que en 1939, y casi todas las áreas que anteriormente tenían un valor alto habían disminuido de tamaño.
Hacia 1990, sin embargo, la situación había cambiado drásticamente. El área con valores muy altos se extendía mucho más al norte y hacia adentro que antes. Las áreas del lado sur tenían valores del suelo relativamente altos en 1990, particularmente en la parte sur del Loop (cerca del CBD) y Hyde Park (a lo largo del lago Michigan, al sur del CBD).
Después de 1990, el patrón de revitalización continua de la ciudad se basa en un análisis de las ventas actuales de suelo vacante. La expansión del área de alto valor hacia el norte y el oeste del CBD es notable, y el lado sur cercano también gozó de un resurgimiento durante este tiempo.
La figura 2 (página 21) muestra cómo la reciente recesión afectó el crecimiento de los valores del suelo en Chicago cuando se lo expresa en función de la distancia del CBD. Las gráficas muestran el cambio en el valor promedio (logarítmico) del suelo a lo largo del tiempo para circunferencias con centroides a 2, 5, y 10 millas (3,2, 8 y 16 kilómetros) del CBD. En 1913, los valores promedio del suelo eran mucho menores a 10 millas (16 km) del CBD que en los anillos más cercanos al mismo. En la década de 1960, en contraste, había poca diferencia en los valores del suelo a estas distancias. Desde entonces, los valores promedio crecieron mucho más en el anillo a 2 millas (3,2 km) que en ubicaciones más distantes. Durante la Gran Recesión, los valores del suelo disminuyeron rápidamente en el anillo de 2 (3,2 km) millas, menos rápidamente en el anillo de 5 millas (8 km), y no disminuyeron en absoluto en el anillo de 10 millas (16 km). Por lo tanto, las áreas que tuvieron las mayores tasas de apreciación durante el período de crecimiento extendido también tuvieron las mayores tasas de depreciación durante la recesión.
La figura 3 ofrece una perspectiva distinta de la variación espacial de los valores del suelo a lo largo del tiempo. Los tres paneles muestran superficies promediadas de valores del suelo en 1913, 1990 y 2005. Las superficies de 1913 y 1990 se estimaron con los datos de Olcott, mientras que las estimaciones de 2005 se basan en ventas de suelo vacante. En cada uno de los tres años, los valores del suelo son mucho más altos en el CBD que en cualquier otro lado. En 1913, hay una gran cantidad de picos locales de valores del suelo en las intersecciones de las calles principales. Estas zonas eran distritos comerciales relativamente pequeños que atendían a los residentes locales antes de que el uso del automóvil se hiciera habitual. En 1990, el pico de valor del suelo en el CBD está acompañado por una meseta mucho más baja justo al norte, a lo largo de la ribera del lago. En 2005, esta meseta se había ampliado a un área grande que se extiende muy hacia el norte y hacia adentro de la ribera del lago. La región de altos valores del suelo también se ha extendido al sur a lo largo del lago, con un aumento local mucho más al sur en Hyde Park.
Persistencia de patrones espaciales
Los valores históricos del suelo son interesantes no sólo porque revelan cómo un área urbana ha cambiado con el tiempo, sino también porque el pasado sigue ejerciendo una influencia sustancial sobre el presente. Las ciudades no se reconstruyen a partir de cero en cada período. Los edificios están en pie mucho tiempo antes de ser demolidos, y los sitios que eran atractivos en el pasado tienden a ser deseables por mucho tiempo. Una de las características únicas del conjunto de datos de Olcott es que nos permite comparar valores del suelo de 100 años atrás con valores y usos del suelo en la actualidad.
La figura 4 (página 24) muestra la fecha promedio de construcción de los cuadrados de 1/8 x 1/8 de milla (alrededor de 200 x 200 metros). Se puede observar la reciente recentralización de Chicago en la forma de “rosquillas” de las edades de los edificios en torno al CBD. Los edificios más nuevos están cerca del CBD, mientras que los más viejos están en el siguiente anillo externo. Los edificios en la región más distante son los que tienen mayor probabilidad de haber sido construidos entre 1940 y 1970.
La figura 5 (página 24) resume esta relación comparando la media de la fecha de construcción con la distancia al CBD. Los edificios más viejos están en un anillo a solo 5 millas (8 km) del CBD.
Una buena medida de la densidad estructural es la relación entre el área edificada y el tamaño del lote. La teoría económica predice que las densidades estructurales serán altas en lugares donde los valores del suelo son altos. Las estructuras duran un tiempo largo. ¿Qué tan bien pueden los valores pasados predecir la densidad estructural actual? La figura 6 (página 24) compara la densidad estructural de los edificios en los padrones de tasación del condado de Cook en 2003 con los valores del suelo en 1913 y 1990. Este conjunto de datos incluye el área construida de cada estructura residencial pequeña (seis unidades o menos) en Chicago.
La altura de las barras indica las densidades estructurales: Las barras altas tienen relaciones relativamente altas de área construida por tamaño del lote. El color de las barras indica los valores del suelo: Las barras rojas tienen valores relativamente altos del suelo. Por lo tanto, deberíamos esperar una gran cantidad de barras rojas altas y barras verdes bajas. En general, los dos paneles indican una correlación positiva entre densidad estructural y valores del suelo. La correlación es particularmente evidente en el lado norte y en la ribera del lago. La correlación con 1990 es menos clara en los lados sur y oeste. Hay varias elevaciones en la superficie de densidad que no tienen una contraparte de valores altos del suelo. Una explicación de estos resultados, que coinciden con la reorientación de áreas de precios altos hacia el lado norte, es que las densidades relativamente altas en estas áreas son manifestaciones de un pasado en el que estas manzanas eran relativamente más valiosas y había un mayor incentivo para usar el suelo de manera más intensiva. El panel de 1913 de la figura 6 sugiere que los valores del suelo tienen en realidad mayor correlación con las densidades de edificios en 2003 que los valores de 1990. La causa de esta aparente anomalía se debe a que la densidad de edificios es un reflejo de las condiciones económicas en el momento de su construcción, y la mayoría de los edificios en esa parte de la ciudad fueron construidos hace mucho tiempo. El pasado sigue ejerciendo una influencia importante sobre el presente.
Conclusión
Los datos de Olcott proporcionan una imagen clara de los cambios en la estructura espacial de Chicago durante la mayor parte del siglo XX. Chicago, que nunca fue una ciudad monocéntrica, comenzó el siglo con valores del suelo muy altos en el CBD, a lo largo del lago y junto a las avenidas y bulevares principales que irradiaban del centro. Los valores también fueron altos en áreas de comercios minoristas ubicadas en las intersecciones de las calles principales. Para 1939, el lado norte de Chicago ya había comenzado a mostrar su hegemonía económica. Después, en la década de 1960, la ciudad sufrió un largo período de decadencia en el cual el CBD era la única concentración importante de valores altos del suelo. Desde entonces, la ciudad ha experimentado un resurgimiento notable. Los valores altos del suelo ya se extienden a casi todo el lado norte, y han repuntado en partes del lado sur. Nuestro análisis también muestra el importante papel del pasado en la estructura espacial actual de la ciudad. Una consecuencia de esta persistencia es que los valores del suelo de hace un siglo predicen mejor la densidad del inventario de viviendas actual que los valores presentes.
Agradecimientos
Los autores agradecen al Instituto Lincoln de Políticas de Suelos su generoso financiamiento y su apoyo. Asimismo agradecen al Centro de Estudios Metropolitanos de TU-Berlin por alojar al equipo de investigadores durante el proyecto. Quieren dar las gracias a Kristoffer Moeller and Sevrin Weights por su importante contribución en el diseño y coordinación de la recopilación del conjunto de datos. Philip Boos, Aline Delatte, Nuria-Maria Hoyer Sepulvedra, Devika Kakkar, Rene Kreichauf, Maike Rackwitz, Lea Siebert, Stefan Tornack y Tzvetelina Tzvetkova brindaron una ayuda inestimable en investigación.
Sobre los autores
Gabriel M. Ahlveldt es profesor asociado de la Escuela de Economía y Ciencias Políticas de Londres (LSE) en el Departamento de Geografía y Medio Ambiente, y del Centro de Investigaciones Económicas Espaciales (SERC).
Daniel P. McMillen es profesor del Departamento de Economía de la Universidad de Illinois en Urbana-Champaign.
Recursos
Ahlfeldt, Gabriel M., Kristoffer Moeller, Sevrin Waights y Nicolai Wendland. 2011. “One Hundred Years of Land Value: Data Documentation.” Centre for Metropolitan Studies, TU Berlin.
Ahlfeldt, Gabriel M. y Nicolai Wendland. 2011. “Fifty Years of Urban Accessibility: The Impact of the Urban Railway Network on the Land Gradient in Berlin 1890–1936.” Regional Science and Urban Economics 41: 77–88.
Atack, J.y R. A. Margo. 1998. “Location, Location, Location! The Price Gradient for Vacant Urban Land: New York, 1835 to 1900.” Journal of Real Estate Finance & Economics 16(2) 151–172.
Colwell, Peter F. y Henry J. Munneke. 1997. “The Structure of Urban Land Prices.” Journal of Urban Economics 41: 321–336.
Cunningham, Christopher R. 2006. “House Price Uncertainty, Timing of Development, and Vacant Land Prices: Evidence for Real Options in Seattle.” Journal of Urban Economics 59: 1–31.
Dye, Richard F.y Daniel P. McMillen. 2007. “Teardowns and Land Values in the Chicago Metropolitan Area.” Journal of Urban Economics 61: 45–64.
Hoyt, Homer. 1933. One Hundred Years of Land Values in Chicago. Chicago: University of Chicago Press.
McMillen, Daniel P. 2006. “Teardowns: Costs, Benefits, and Public Policy.” Land Lines, Lincoln Institute of Land Policy 18(3): 2–7.
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Una versión más actualizada de este artículo está disponible como parte del capítulo 7 del CD-ROM Perspectivas urbanas: Temas críticos en políticas de suelo de América Latina.
Un mecanismo creciente de producción de suelo y vivienda en los Estados Unidos lo constituyen las subdivisiones comunitarias automanejadas de bajos recursos, denominadas “colonias” en Texas. En un estudio reciente financiado por el Instituto Lincoln, el autor de este artículo analiza los aspectos disfuncionales de estos mercados de suelo, destacados por un alto índice de propietarios absentistas, discretos niveles de transacción y rotación de terrenos y propiedades, y una falta de valorización (incremento del valor) significativa conforme se lleva a cabo la construcción y el mejoramiento de los asentamientos.
Subdivisiones comunitarias
Las colonias son emplazamientos con infraestructuras inadecuadas (o simplemente inexistentes) que se identificaron inicialmente en los condados más pobres de Texas a lo largo de la frontera mexicana. Sus pobladores compran terrenos sobre los cuales colocan casas-remolque o las menos móviles “casas prefabricadas”. En algunos casos las familias mismas construyen sus casas, comenzando con chozas endebles o remolques de segunda mano que van arreglando con el paso del tiempo.
Ciertamente las colonias no son un fenómeno de escala menor. Según el Consejo de Desarrollo de Agua de Texas, hay aproximadamente 1500 de estos asentamientos poblados por unas 400 mil personas, principalmente en las regiones fronterizas de los Estados Unidos. Los datos del Consejo y los resultados de nuestro propio estudio demuestran que existen muchas subdivisiones similares en otras localidades texanas, por lo cual estos estimados de población probablemente aumenten conforme se vayan incorporando nuevos datos. Muchos condados de Texas y de otros estados están comenzando a reconocer los problemas de estas subdivisiones no incorporadas que ofrecen unas de las pocas opciones de acceso a vivienda a las familias de bajos recursos.
Por “bajos recursos” nos referimos a ingresos familiares anuales que oscilan entre $12 000 y $25 000, aunque en realidad muchas familias de las colonias perciben entradas muy inferiores (véase la tabla 1). Estas familias residen en áreas de mercados laborales pobres, bien sea en regiones que experimentan polarización salarial y laboral entre trabajadores, o bien donde hay un predominio de empleos mal remunerados del sector de servicios. En la mayoría de las ciudades, los costos de vivienda están fuera del alcance de los habitantes pobres, quienes entonces recurren al extremo inferior del mercado de alquiler, en apartamentos o en terrenos para remolques (trailer parks). Aun así, muchas de estas familias aspiran a ser propietarias de viviendas porque reconocen las ventajas de escapar del modo habitacional de alquiler, carente de equidad. Muchas de ellas prefieren optar por estas subdivisiones rurales con infraestructuras inadecuadas, donde al menos pueden ser dueñas de propiedades que pueden valorizarse a través de ayudas mutuas y esfuerzos propios.
No obstante, las colonias no son homogéneas, sino que presentan fuertes variaciones en cuanto a su tamaño, disposición, modo de desarrollo, mezclas de tipos de viviendas, dimensiones de las parcelas, ocupación del terreno y tasas de rotación residencial, niveles de servicio, composición étnica, niveles de ingresos, y niveles de pobreza relativa. En Texas no existen colonias típicas, sino más bien una variedad de ellas, con diferencias de condado a condado.
Estos asentamientos son similares a los emplazamientos irregulares de países menos desarrollados, y su existencia se explica por un raciocinio similar, o sea: una economía de salarios bajos, el aumento en la demanda de vivienda, la falta de sistemas estatales de abastecimiento de viviendas capaces de satisfacer la demanda, y un sector privado desinteresado o incapaz de producir soluciones habitacionales económicas. Al igual que sus equivalentes en México y América Latina, las colonias ofrecen terrenos económicos carentes de servicios en los márgenes de áreas urbanizadas, terrenos que son costeables y accesibles a los grupos de ingresos más bajos de la sociedad. La mayoría de sus habitantes tienen que desplazarse largas distancias para llegar a sus trabajos en ciudades adyacentes.
Si bien las colonias en Texas son raramente ilegales, muchos aspectos del proceso de desarrollo son informales o cuasi-formales, especialmente:
Hace justamente una década, Texas identificó la existencia y proliferación de estas subdivisiones tipo colonias, y a través de sesiones legislativas bienales se iniciaron un conjunto de acciones destinadas tanto a detener su crecimiento como a simular su modernización. A continuación se exponen algunos ejemplos de las acciones legislativas tomadas al respecto en la última década:
Una debilidad subyacente de todas estas iniciativas es su aplicación exclusiva a la región fronteriza, únicamente a condados especialmente designados que forman parte del Programa de Áreas Empobrecidas (EDAP, por su sigla en inglés). En otras partes, el crecimiento de las colonias continúa impertérrito.
Parcelas vacantes y propietarios absentistas
Un indicador principal de la disfunción en los mercados de suelo es la falta de ocupación y desarrollo de las parcelas después de su venta. Se ha demostrado que entre el 15 y el 80 por ciento de los terrenos de las colonias pueden estar vacantes. Incluso en los asentamientos más grandes (y a menudo dotados plenamente de servicios), entre una cuarta y una sexta parte de los terrenos está vacante y pertenece a propietarios absentistas. Más aún, la existencia de terrenos relativamente grandes de 500 a 2000 metros cuadrados (o más), aunada a las prohibiciones de subdivisión y compartimento de los mismos, llevan a muy bajas densidades de población, entre 25 y 30 personas por hectárea. Esta característica exacerba el costo unitario de la provisión de servicios, reduce la recuperación de los costos, y debilita la cohesión de la comunidad y la ayuda mutua. Nuestros cálculos indican que hay más de 26.000 parcelas vacantes en Texas, lo cual equivale a más de 2800 hectáreas de suelo residencial desocupado. Si estas parcelas estuvieran totalmente ocupadas, incluso a las bajas densidades de población que caracterizan a las colonias, se podría alojar a otras 100 000 personas sólo en los asentamientos ya existentes.
Por tanto, la pregunta obligatoria aquí es, ¿cuál es la razón de que tantas familias pobres no ocupen sus parcelas? En términos de pura lógica uno podría pensar que la falta de servicios desanima a los pobladores potenciales, y que un catalizador para la ocupación de los solares sería la provisión de los servicios públicos básicos. No obstante, es de destacar que muchas personas sí ocupan sus parcelas desde el principio. Si bien es posible preguntarles directamente sus motivos y la razón de sus decisiones, ciertamente es difícil hacer lo mismo con los numerosos propietarios absentistas con paradero desconocido. ¿Quiénes son estas personas? ¿dónde están? ¿qué quieren de sus tierras?
A pesar de los obstáculos metodológicos derivados de la ausencia de documentos claros que detallen registros de compraventa de propiedades y títulos de las parcelas, nosotros pudimos utilizar registros de impuestos y de tasación de propiedades para rastrear algunos de estos propietarios absentistas. Sin embargo, determinamos que entre el 8 y el 10 por ciento de estos registros aparecen con direcciones “equivocadas”, con la consiguiente probabilidad de que el verdadero número de propietarios absentistas con paradero desconocido sea dos veces mayor. Al haber abandonado el suelo que compraron, estas personas están en efecto impidiendo que sus propiedades participen en futuras transacciones del mercado de suelo.
Lugar de residencia actual de los propietarios absentistas Mediante los registros tributarios de unos 2713 propietarios absentistas de 16 asentamientos (en condados fronterizos y no fronterizos), nos fue posible averiguar el paradero actual de los mismos.
Alrededor de un 75 % de ellos vive en los alrededores, bien sea en la ciudad adyacente o bien a distancias no mayores de 30 km. El resto de los absentistas se divide equitativamente entre aquéllos que viven en otras regiones de Texas y los que viven fuera del estado. En el primer grupo, si bien se observó una amplia dispersión de domicilios a lo largo y ancho del estado, la mayoría vive en Houston (26 %), Dallas (15 %) y San Antonio (12 %) -las tres áreas metropolitanas principales de Texas. De los absentistas que viven fuera del estado, el 35 % vive en California, seguido por un 14 % en Nuevo México y finalmente un 12 % en la región de Chicago (Illinois e Indiana).
Características de los ocupantes y de los propietarios absentistas
Esta investigación reveló que los ocupantes de las colonias y los propietarios absentistas son poblaciones bastante diferentes (véase la tabla 1). Dos tercios de los residentes de las colonias, en comparación con la mitad de los propietarios absentistas, son nacidos en México. Los propietarios absentistas exhiben una mayor diversidad étnica, y a pesar de ser pobres, están en mejor situación que los habitantes de las colonias; en su mayoría, adquirieron sus parcelas con anterioridad, y por tal motivo pagaron menos en términos reales.
Las diferencias más significativas entre los grupos se evidencian en sus patrones habitacionales y en los motivos de sus compras. Las familias absentistas no están esperando mudarse a sus parcelas tan pronto las equipen con servicios públicos. La mayoría de ellas (81 %) son ya propietarias de viviendas y parecen estar muy cómodas en sus residencias actuales. Aún más, un 49 % de los absentistas indicaron no haber comprado los terrenos para ellos, sino más como inversión, seguridad, o como herencia futura para sus hijos. Menos del 25 % declaró que la falta de servicios fuera el problema. Más de la mitad expresó no tener intenciones de mudarse a las parcelas en el futuro. De aquellos que sí han pensado en ocuparlos, muy pocos planean hacerlo en los próximos 5 a 10 años. En nuestra opinión, muy pocos terminarán mudándose. Algunos incluso dijeron que venderían sus parcelas en cualquier momento si se les ofreciera un buen precio.
Durante las últimas dos décadas, el mercado del suelo para ambas poblaciones ha sido totalmente diferente al de otros mercados residenciales. En términos reales, el valor del suelo de las colonias ha permanecido estancado y la tasa de recuperación ha sido baja, especialmente cuando se la compara con otros sectores del mercado de suelo y vivienda. Tal realidad sugiere que los pobres realmente no se están beneficiando ni de su inversión inmobiliaria, ni tampoco -en el caso de los residentes- del valor añadido a sus propiedades por mejoras realizadas por ellos mismos. Aunque sigue habiendo un nivel discreto de ventas (mayor que el anticipado), los mercados de suelo de las colonias no están experimentando una valorización significativa.
Políticas de mejoramiento del mercado
Los terrenos vacantes son, al mismo tiempo, la causa y el efecto de este bajo rendimiento del mercado. Es importante destacar aquí la errónea interpretación que se le da a la filosofía “constrúyalo y ellos vendrán”. Si bien es cierto que las políticas de desarrollo de los servicios urbanos pueden ayudar a acelerar la ocupación de los terrenos y la densificación de las colonias, también es cierto que se requieren otras intervenciones para mejorar la eficiencia de los mercados de suelo en las colonias. Entre dichas intervenciones podría figurar una revisión de las leyes para aumentar la productividad urbana, p. ej., otorgar permisos para el uso no residencial del suelo (a fin de generar ingresos), o para subdivisiones y alquileres. En efecto, una de las razones detrás de la falta de valorización de la tierra es la restricción impuesta sobre usos aprobados. Otro limitante del desarrollo es la moratoria de 1995 impuesta sobre las ventas de parcelas. Si bien es cierto que la ley se infringe constantemente, este hecho desinfla los precios, distorsiona la rotación de los terrenos y alienta las ventas clandestinas. La prohibición de las subdivisiones de parcelas internas (especialmente las de parcelas grandes) inhibe los alquileres y el compartimento de costos entre parientes.
También se plantea la necesidad de sacar al mercado las tierras que pertenezcan a personas con paradero desconocido. Al respecto, se podría llevar a cabo un secuestro de las parcelas que tengan imposiciones morosas, especialmente si tal abordaje se combinara con la creación de una empresa de tenencia pública o de fideicomiso de tierras que se dedique posteriormente a promover el suministro y la redistribución de solares a través de mecanismos tales como la socialización y el reajuste de la tierra. Al menos en Texas, atacar el “problema” de los propietarios absentistas ofrece la posibilidad de soluciones y resultados positivos.
Al trabajar por entender y proporcionar nuestro análisis de las subdivisiones comunitarias de Texas y otros estados, podremos suministrar más información a los legisladores, y posiblemente promover políticas del suelo más adaptadas y apropiadas para atacar el problema. Así, quizás pueda haber un aumento significativo de oportunidades habitacionales para los grupos más pobres de la sociedad estadounidense.
Referencias
Peter M. Ward. 1999. Colonias and Public Policy in Texas and Mexico: Urbanization by Stealth. Austin, TX: University of Texas Press.
______. 2000. Residential Land Market Dynamics, Absentee Lot Owners and Densification Policies for Texas Colonias. Artículo del Instituto Lincoln. WP00PW1. 160 páginas.
Peter M. Ward tiene el cargo del C.B. Smith Sr. Centennial Chair in US-Mexico Relations en la Universidad de Texas-Austin, donde también es profesor en el Departmento de Sociología y en la Escuela de Asuntos Públicos Lyndon B. Johnson.
Call for Research and Conference Papers
The documented proliferation of colonias in Texas suggests that similar types of quasi-formal homestead subdivisions exist across much of the U.S. to provide access to home ownership for urban households earning less than $20,000 a year. While there are significant private transport costs associated with living in poorly serviced communities several miles beyond the urban fringe, families of all ethnicities are quick to recognize the advantages of self-managed home ownership on relatively large lots compared to renting a trailer or apartment.
To investigate this phenomenon further, the Lincoln Institute is inviting researchers interested in quasi-formal homesteading to form a network to facilitate the collection and sharing of data. In addition, the Institute is sponsoring a conference to be held in Cambridge, Massachusetts, in Fall 2001 to pursue these three goals:
1) to develop a comparative research agenda to analyze quasi-formal homestead subdivisions;
2) to develop methodologies and data gathering strategies about the development of these subdivisions and land market performance; and
3) to develop policy instruments and approaches suitable for application in the U.S. and to learn from best practices in other countries.
The target audience for the conference includes scholars and researchers, county officials or their equivalents, and legislators or their senior aides with an interest in land policy for self-help homesteading among the poor. The conference planners are seeking participants to prepare papers on the following issues:
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Vacant land and its integration into the urban land market are topics rarely investigated in Latin America. The existing literature tends to focus only on descriptive aspects (i.e., number and size of lots). In the current context of profound economic and social transformations and changing supply and demand patterns of land in cities, the perception of vacant land is beginning to change from being a problem to offering an opportunity.
A comparative study of vacant land in six Latin American cities (Buenos Aires, Argentina; Lima, Peru; Quito, Ecuador; Rio de Janeiro, Brazil; San Salvador, El Salvador; and Santiago, Chile) was recently completed as part of an ongoing Lincoln Institute-sponsored research project. The participating researchers examined different categories of vacant land, the problems they generate and their potential uses, as well as the changing roles of both private and public agents, including governments, in the management of vacant land. They concluded that vacant land is an integral element of the complex land markets in these cities, affecting fiscal policies on land and housing. Thus, vacant land has great potential for large-scale developments that could result in improved conditions for urban areas, as well as reduced social polarization and greater equity for their populations.
The six cities in the study vary in size but share the common attributes of rapid population growth and territorial expansion. They also have comparable social indicators (high rates of poverty, unemployment and underemployment), significant deficits in housing and provision of services, and high levels of geographical social stratification and segregation. The land markets in each of the cities also have similar characteristics, although they exhibit their own dynamics in each sub-market.
Characteristics of Vacant Land
The four primary characteristics of vacant land considered in this research project are ownership, quantity, location and length of vacancy. In general, vacant land in Latin America is held by one or more of the following agents, each with their respective policies: real estate developers or sub-dividers (both legal and illegal); low-income people who have acquired land, but cannot afford to develop it; real estate speculators; farmers; state enterprises; and other institutions such as the church, the military, social security, etc.
Determining how much vacant land exists in each city depends on the definition given to the term in the respective country . Quantifying vacant land is further complicated by the numerous obstacles that exist to obtaining accurate information, thus limiting the possibility of comparing data and percentages across metropolitan areas. Finally, in several of these cities (San Salvador, Santiago and Buenos Aires) there are significant “latent” vacant areas. These are unused or marginally used buildings, often previously occupied by former state-owned companies, waiting for new investments in order to be demolished or redeveloped.
In these six cities, the percentage of vacant land ranges from under 5 percent in San Salvador to nearly 44 percent in Rio de Janeiro. If all of San Salvador’s “latent” vacant areas were included, the percentage of vacant land could increase to 40 percent of the total metropolitan area. On the whole, vacant land in the cities accounts for a significant percentage of serviced areas that could potentially house considerable numbers of people who currently have no access to serviced urban land.
The location of vacant land is relatively uniform throughout the region. Whereas in the United States vacant land tends to be centrally located (such as abandoned areas or industrial brownfield sites), in Latin America the majority of vacant sites lie in the outskirts of the cities. These areas are frequently associated with speculation and retention strategies for occupation based on the provision of services. In contrast, the length of time land has been vacant differs considerably: in Lima and Quito, vacant urban lots are relatively “new,” whereas in Buenos Aires some urban lots have remained vacant for several decades.
Policy Issues and Development Potential
An evaluation of the urban-environmental conditions of vacant land concludes that a significant number of sites could tolerate residential or productive activities. These areas currently constitute an underutilized resource and should be considered for investments in urban infrastructure to improve land use efficiency. An equally significant segment, however, has important risk factors: inadequate basic infrastructure; water polluted by industrial waste; risk of flood, erosion or earthquake; and poor accessibility. Such land is inappropriate for occupation unless significant investments are made to safeguard against these environmental problems. Some land in this category could have great potential for environmental protection, although consciousness about land conservation remains a low priority in Latin America.
The study asserts that, in general, the urban poor have little access to vacant land due to high land values, despite the fact that values do vary according to sub-market. Prices are high in areas of dynamic urban expansion that offer better accessibility and services. A large amount of vacant land in several of the cities studied is not on the market and will likely remain vacant for an indefinite period of time. It is in these areas, the researchers contend, that policies should be implemented to reduce the price of serviced vacant land to make it more accessible to the poor.
The majority of Latin American cities have no explicit policies or legal framework regarding vacant land. In those cities where some legislation does exist, such as Rio de Janeiro, it is basically limited to recommendations and lacks real initiatives. In Santiago, recent legislation has promoted increased density in urban areas, yet it is too soon to know the implications of these measures. References to the environment are also generally lacking in “urban” legislation. Vacant land could play an important role in urban sustainability. However, reaching this potential would depend on better articulation between environmental and planning actions, especially at the local level.
Another characteristic common to the areas studied, with the exception of Santiago, is that urban development policy and specific land market policies have been disconnected from tax policy. Even in those cities where there is a distinction in taxation on vacant versus built land-such as Buenos Aires or Quito-it has not translated into any real changes. Sanctions and higher taxes on vacant areas have largely been avoided through a series of loopholes and “exceptions.”
Proposals and Criteria for Implementation
Arguing for an increased government role in land markets in combination with institution-building and capacity-building among other involved actors, the study formulates a number of proposals for the use and reuse of vacant land in Latin America. An overriding proposal is that vacant land should be incorporated into the city’s overall policy framework, taking into account the diversity of vacant land situations. Land use policies to increase the number of green areas, build low-income housing and provide needed infrastructure should be implemented as part of a framework of urban planning objectives. Furthermore, vacant land should be used to promote “urban rationality” by stimulating the occupation of vacant lots in areas with existing infrastructure and repressing urban growth in areas without appropriate infrastructure.
Urban policy objectives on vacant land should also be pursued through tax policy. Some suggestions formulated in this regard are the broadening of the tax base and tax instruments; incorporating mechanisms for value capture in urban public investment; application of a progressive property tax policy (to discourage land retention by high-income owners); and greater flexibility in the municipal tax apparatus.
These policies should be linked to other mechanisms designed to deter the expansion of vacant land and the dynamic of geographical social stratification and segregation. Such related mechanisms might include the granting of low-interest credits or subsidies for the purchase of building materials; technical assistance for construction of housing; provision of infrastructure networks to reduce costs; and credits or grace periods for payment of closing costs, taxes and service fees on property.
Other proposals address the development of pilot programs for land transfers using public-private partnerships to build on government-owned land in order to promote social housing at affordable rates; reuse of some land for agricultural production; and greater attention to environmental issues, with the goal of assuring urban sustainability in the future.
The 1994 Regulatory Plan for the Santiago metropolitan area defined a goal of elevating the city’s average density by 50 percent, while 1995 reforms to the Ley de Rentas introduced a fee on non-edified land and a disincentive to land speculation.
Nora Clichevsky is a researcher with CONICET, the National Council for Scientific and Technical Research in Buenos Aires, Argentina. She is the coordinator of the six-city study of vacant land in Latin America, which met to discuss these findings in August 1998. Laura Mullahy, a research assistant with the Lincoln Institute’s Latin American Program, contributed to this article.
Other members of the research team are Julio Calderón of Lima, Peru; Diego Carrión and Andrea Carrión of CIUDAD in Quito, Ecuador; Fernanda Furtado and Fabrizio Leal de Oliveira of the University of Rio de Janeiro, Brazil; Mario Lungo and Francisco Oporto of the Central American University in El Salvador; and Patricio Larraín of the Chilean Ministry of Housing and Urbanism.
In the next phase of this project, the Lincoln Institute will sponsor a seminar on vacant land this spring in Río de Janeiro, with the participation of the original researchers as well as other experts from each of the cities involved.
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Mexico is beginning to create an enabling environment to use land value increments for development purposes. Recent constitutional and legal reforms have authorized the clarification of land titling as well as the commercialization of land. Real estate markets are gradually superseding the immobile land tenure arrangements that gave rise to informal markets characterized by confusing and often arbitrary arrangements and high transaction costs. The private sector is moving into the areas of low-income housing and public-private arrangements for balanced and sustainable land developments.
The State of Mexico has launched a comprehensive program, known as PRORIENTE, to promote government, business and community interaction for joint management and financing of urban development in the eastern part of the territory. PRORIENTE’s vision is one of “new cities” surrounding the Mexico City megalopolis, characterized by balanced growth between demographic densification, income-generating activities and environmental protection. The creation of employment in and around the new settlements is an overriding social and economic goal of the program.
Given the intricate pattern of interests involved, PRORIENTE has adopted an intersectorial and interjurisdictional approach. Indeed, PRORIENTE requires that the State of Mexico take the initiative to coordinate land and fiscal policies and instruments among the federal government, the newly elected opposition government of the Federal District, and the many municipalities that are largely controlled by opposition parties.
The challenges for PRORIENTE are formidable:
Population growth in the region between now and the year 2,020 is estimated at five million people.
Deforestation and disorganized urbanization of agricultural areas are leading to further desertification of this region.
Innovative policies and contractual arrangements have yet to be introduced to create effective land markets.
Uncontrolled urbanization has been dominated by private developers who speculate with land prices, ignore urban planning and appropriate huge increases in land values, as well as by settlements of low-income immigrants. New mechanisms for public capture of increases in land values that emanate from new policies and/or administrative decisions will have to overcome serious resistance.
Real estate taxation is largely underdeveloped, and the property tax structure is plagued with many exceptions. Cadasters are often outdated and have only weak connections with the system of transfer and registration of real property.
Public-private partnerships that are accountable to the communities and operate on a transparent basis are practically unknown in a country with a tradition of a strong federal government.
Intergovernmental fiscal relations and interjurisdictional arrangements have been dominated by the will and the overwhelming fiscal power of the federal government, which controls 80 percent of public income compared to four percent for the municipalities and 16 percent for the state. Local and regional governments are just beginning to experiment with political coalitions and multiparty governments capable of surviving the short life span of one administration.
In view of these obstacles and challenges, the leaders of PRORIENTE have adopted a participatory, negotiating approach that is already producing visible results. Businesses have formed large-scale conglomerates capable of funneling much-needed capital and management technologies into the area. The federal government, the Federal District, municipalities and communities are invited to the negotiating table to participate in an ongoing process that nurtures an expanding program rather than a precise policy or institutional goal.
The Lincoln Institute recognizes that this project presents an excellent opportunity to study the complex role of land as a strategic factor for development throughout Latin America. Last April, the Institute coordinated a seminar on urban land markets in the city of Toluca, and is continuing to serve as a sounding board for policymakers of the State of Mexico and other public and private actors involved in PRORIENTE.
In addition, a Lincoln Institute team is cooperating with other institutions and practitioners to share international experiences regarding both the process of policy formation and the operational side of the PRORIENTE program. Special attention is given to the sustainability and replicability of strategies to facilitate the transition from restrictive land tenancy systems, weak property tax administrations and highly centralized fiscal resources to competitive land markets and local land use initiatives to encourage development. The Institute will utilize this experience in Mexico for developing courses in other countries facing similar situations.
Fernando Rojas, a visiting fellow of the Lincoln Institute, is a legal scholar and public policy analyst from Colombia. He was formerly a visiting fellow at the David Rockefeller Center for Latin American Studies at Harvard University. Alfonso Iracheta is technical secretary of PRORIENTE and the director of planning for the State of Mexico.
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The land market allocates land and access to urban amenities, and it does so with impressive efficiency. Yet, economists and planners continue to debate the extent to which the market fails to achieve broader social goals, how far regulation can offset for that failure, and even whether regulation results in land market outcomes being even farther from the socially desired outcome than would be the case without any regulation. To examine this debate and the underlying issues, more than 30 economists and planners met at the Lincoln Institute in July 2002 to encourage new policy-relevant analysis on land markets and their regulation, and to foster more fruitful communication between the disciplines.
At the center of the substantive debate was the basic question of regulation within a market economy and the unintended consequences that can result. The discussions touched upon many themes including gentrification, the use of public resources for private consumption, distributional issues, urban form and its regulation. If perspectives regarding market regulation differed between the two disciplines, so too did views regarding the strengths and limitations of the analytic tools that academics from different disciplines bring to such thorny problems. Among the challenges are the basic questions of how to define the problem, how to measure the current conditions in light of limited data, and how to interpret findings. Throughout the conference, the differences in the perspectives, assumptions, tools and references between planners and economists were ever present, in particular with regard to the role of politics in planning and policy making.
Unintended Consequences of Land Market Regulations
Despite their differences, concern for land markets and their centrality to social, political and economic life was the common focus of both economists and planners at the conference. They agreed that land markets are about far more than land. These markets have an important role in delivering life experiences and conditioning the welfare of the majority of people in developed and developing countries alike who live and work in cities. In addition, their regulation has both direct and indirect economic effects that extend into many areas of economic life and public policy. For example, the urban poor are likely to have worse schools and to experience higher levels of neighborhood crime because land markets capitalize the values of neighborhood amenities, such as better school quality and lower crime, thereby pricing poorer households into less desirable neighborhoods.
This power of land markets to reflect and capitalize factors that affect a household’s welfare was revealed in a study of impact fees levied on new development in Florida. Ihlanfeldt and Shaughnessy found that impact fees appear to be fully capitalized into house prices for owners of new and existing houses by redistributing the costs of new infrastructure provision from existing taxpayers to a reduced value of development land. In fast-growing Miami the cost of impact fees was borne by developers, yet offset by the increases they received in higher prices for new housing, “while buyers of new homes are compensated for a higher price by the property tax savings they experience. In contrast to the neutral effects that fees have on developers, landowners, and purchasers of new housing, impact fees provide existing homeowners a capital gain” (Ihlanfeldt and Shaughnessy, 26).
One complement to their story of Florida’s impact fees was illustrated in several other papers concerned with the unintended outcomes of regulation. British participants reported that Britain’s containment policy has generated higher densities within urbanized areas, but cities leapfrog out across their Greenbelts (or growth boundaries) to smaller satellite settlements; the consequence is that development becomes less contiguous and travel times increase. Villages become high-density suburbs surrounded by a sea of wheat: London in functional terms extends to cover most of southeastern England.
In a U.S. example based on an econometric simulation, Elena Irwin and Nancy Bockstael found that a clustering policy intended to preserve open space could instead backfire. Using Maryland data, they simulated the effects of a policy that was intended to preserve rural open space and found that it would instead accelerate development if “small to moderate amounts of open space are required to be preserved (specifically, 20 acres or less) and would slow the timing of development if larger amounts of open space are required to be preserved” (Irwin and Bockstael, 26). Their simulation results yield an interpretation that is highly nuanced and requires careful thought. That is, under certain conditions the cluster policy can backfire, while under other specific conditions the policy can yield an intended policy outcome.
These hypothetical clusters in Maryland may be echos of a real situation that Jean Cavailhès and his colleagues observed in the French countryside, where some urban dwellers moved to farm regions to create a mixed-use area that is neither entirely urban nor entirely rural. These former urbanites appear to value their proximity to a functioning rural landscape in exchange for longer commutes and (surprisingly) smaller residential lots. The authors hypothesize that these peri-urban dwellers benefit in different ways from living among the farmers.
In another example of the unintended consequences of regulations, Donald Shoup analyzed curbside parking. Many U.S. municipalities require developers to provide minimal parking per square foot of new commercial or, in some communities, residential space. The requirement for off-street parking, coupled with a systematic underpricing of curbside parking, has a double impact, according to Shoup. It imposes a substantial tax on affected developments (equivalent to up to 88 percent of construction costs), increases land taking, and means that public revenues annually lost an amount equal to the median property tax.
In these cases of unintended consequences of policy or regulatory interventions in the market, the authors argued for more careful design of both policies and regulations so state and local governments could reasonably achieve their policy goals. Despite the fact that the conference debate tended to pit regulation against the market, there was probably a tendency—if not full-fledged consensus—to favor market incentives and disincentives to achieve policy goals, rather than to rely strictly, or even largely, on regulation. Roger Bolton’s comments on Shoup’s paper cogently reflected this viewpoint. He said that Shoup’s work was valuable because it urges us to pay attention to a whole package of “important and related phenomena: inefficient pricing of an important good, curb parking; inefficient regulation of another good, privately owned off-street parking; and missed opportunities for local government revenue.”
Data and Measurement Challenges
Growth management and urban form were referenced extensively throughout the conference. The paper presented by Henry Overman, and written with three colleagues (Burchfield et al.) provided useful grounding to that conversation. They attempted to measure the extent of sprawl for the entire continental U.S. Using remote sensing data they calculated and mapped urban development and the change in urban land cover between 1976 and 1992. They defined sprawl as either the extension of the urban area, or leapfrog development, or lower-density development beyond the urban fringe. They concluded that only 1.9 percent of the continental U.S. was in urban use and only 0.58 percent had been taken for urban development in the 16-year period covered by the study. Furthermore, during this period, urban densities were mostly on the increase.
This study found development to be a feature of the “nearby urban landscape,” whether that was defined as close to existing development, or near highways or the coasts, and thus was perceived as encroaching on where people lived or traveled. The authors use this last observation to reconcile the apparent contradiction between their finding that less than 2 percent of the continental U.S. has been developed and the fact that containing and managing sprawl is at the center of policy agendas in many states and regions across the U.S. While relatively little land might have been consumed by new development in aggregate during the study period, many people see and experience this development on a daily basis and perceive it to represent significant change, often the kind of change they do not like.
The conference discussion touched upon some of the data questions raised by this work. The paper’s discussant, John Landis, noted some challenges he has faced in working with these and similar data to measure growth patterns in California. The estimates by Burchfield et al. are extremely low, possibly for technical reasons, according to Landis. Among the reasons is the difficulty in interpreting satellite images and the different outcomes that can occur when different thresholds are used for counting density, for example. That is, an area can be classified as more or less dense depending on what threshold the analysts establishes. “Ground-truthing” is required to remove some of the arbitrariness from the analysis, but this is an enormously costly undertaking.
Policy analysts are always faced with data limitations. Sometimes the problem is missing data, while other times it is data with questionable reliability. Yet, all too often researchers spend very little time paying attention to how serious that deficiency is for the policy problem at hand. When the available data is a very long time series with frequent intervals that relies on a well-structured and well-understood data collection method, and where few transformations occur between data collection and data use, most researchers and policy analysts would feel extremely comfortable interpolating one or two or even a handful of missing data points. Econometricians relying on data collected at regular intervals from government surveys frequently face this situation and are quite adept at filling in such “holes in the data.” In the world of limited data, that might be considered the best-case scenario.
At the other extreme we might have data that are collected using relatively new methods and that require significant transformation between collection and use. Data reliability likely decreases under these circumstances. Given the imperfect world in which we live, the answer is probably not to insist on using only the “best data.” However, researchers and policy analysts do have the obligation to use care in interpreting results based on weak data and to convey that weakness to their audience.
Another side of the limited data problem is the translation from concept to measure, and it explains why the conference participants spent so much time discussing “What is sprawl?” For researchers this question becomes “How does one define sprawl in such a way that one can measure it?” Burchfield et al. define sprawl as leapfrog or discontiguous urban development. Landis argues for “a more multi-faceted definition of sprawl, one that also incorporates issues of density, land use mix, and built-form homogeneity.”
Definitions are not trivial in policy analysis. If we cannot define the problem or the outcome, and we cannot measure it, how can we know if it is getting better or worse, and if our policies are having an impact? On the other hand, a very precise definition of a different but perhaps related concept may lead to unnecessary intervention. The new policy may improve the score on the measure but have little or no effect on the problem. For a variety of reasons (perhaps in part the customs and cultures within different disciplines) the economists at the conference tended to favor concepts that are simple and for which the data exist. On the other hand, the planners tended to favor concepts that are messy. In the end, one is left with weaknesses on both sides. The uni-dimensional definition, and therefore the uni-dimensional measure, may provide many of the desirable properties that allow statistical analyses. Multi-dimensional concepts are difficult to translate into measures. Which is better for policy making?
The Political Nature of Land Policy
Planning as a political activity was emphasized by several authors, notably Chris Riley (discussant of papers by Edwin Mills and Alan Evans), to emphasize the importance for economists to recognize this role and the constraints it imposes on significant change (particularly given the capacity of land markets to capitalize into asset values the amenities generated by planning policies themselves). Richard Feiock added there was also evidence that the forms of planning policies that communities selected (both the severity of such policies and the degree to which they relied on regulation in contrast to market instruments) could be largely accounted for by the political structure and socioeconomic and ethnic composition of those communities.
Participants reacted differently to the political nature of land policy and planning. For some this was problematic: it meant that the market was not being allowed to work. For others, it meant that the political process in a democracy was being allowed to work: the people had spoken and the policy reflected the expressed will of the body politic.
Reflections on Debate
The differences between economists and planners will continue, and differences among practitioners in different countries and even different parts of the same country (notably the large United States) can either stimulate or thwart future debates over the study of land market policies and implementation. Perhaps, though, the word debate itself thwarts our efforts. In debates, the debaters rarely change their minds. They enter the debate with their point of view firmly fixed and do not get “points” for admitting that their debating opponent taught them something or that they have consequently changed their own mind. However, one purpose of a professional conference is, indeed, for thoughtful people to consider their own assumptions and to be informed and changed by the points of view of others. In the future, perhaps debates will be supplanted with reflective conversation.
Paul Cheshire is professor of economic geography at the London School of Economics, England; Rosalind Greenstein is senior fellow and cochair of the Department of Planning and Development at the Lincoln Institute; and Stephen C. Sheppard is professor in the Department of Economics at Williams College, Massachusetts. They jointly organized the Lincoln Institute conference, “Analysis of Urban Land Markets and the Impact of Land Market Regulation,” on which this article is based.
Conference Papers
The conference participants whose papers are cited in this article are noted below. All conference papers and discussants’ comments are posted on the Lincoln Institute website (www.lincolninst.edu) where they can be downloaded for free
Burchfield, Marcy, Henry Overman, Diego Puga and Matthew A. Turner. “Sprawl?”
Cavailhès, Jean, Dominique Peeters, Evangelos Sékeris, and Jacques-François Thisse. “The Periurban City.”
Feiock, Richard E. and Antonio Taveras. “County Government Institutions and Local Land Use Regulation.”
Ihlanfeldt, Keith R. and Timothy Shaughnessy. “An Empirical Investigation of the Effects of Impact Fees on Housing and Land Markets.”
Irwin, Elena G. and Bockstael, Nancy E. “Urban Sprawl as a Spatial Economic Process.”
Shoup, Donald. “Curb Parking: The Ideal Source of Public Revenue.”
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During the last decade, bus rapid transit (BRT) has revolutionized regional transportation planning in much of the developing and developed world. BRT went from being a fringe transportation option used in a handful of Brazilian and Australian cities to becoming a prominent mass transportation alternative for local and national governments.
Arguably the BRT concept with highest recognition is the provision of an exclusive right-of-way for bus transit coupled with high-frequency service. In South America, BRT systems in Curitiba, Brazil, and Bogotá, Colombia, feature networks of dedicated lanes designated for exclusive use by large-capacity, articulated buses, with expedited boarding and alighting.
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More than any other single variable, the change in land values across time and over space provides important insights into the shifting spatial structure of a city. Whereas a typical property sale reflects the combined value of the land and buildings, the land value alone represents the actual current worth of a location and suggests expectations about the future. Even if a parcel bears the burden of an outmoded construction, the price of the land reflects the present discounted value of the stream of returns that could be earned from the highest and best use of the parcel. Rapidly rising land prices in an area of a city are a clear indication that people expect the neighborhood to be in high demand for some time to come, signaling investment opportunities to developers. Changes in land values may also serve to alert city officials that an area may require zoning changes and investments in infrastructure.
Land value is also an important component in the cost approach to property assessment, which is one of the three commonly used assessment methods (including the sales comparison and income approaches). The cost approach has three major components: (1) the cost of building the existing structure if it were new at the time of assessment; (2) the depreciation of the building to its current condition; and (3) the price of the land parcel. Adding (1) to (3) and subtracting (2) generally produces a good estimate of overall property value. In standard property transactions, however, land values are not easily separated from the value of structures. Sales of vacant land, which more clearly indicate a site’s value, are relatively rare in large, built-up urban areas; as a result, relatively few studies of vacant land sales exist (see Ahlfeldt and Wendland 2011; Atack and Margo 1998; Colwell and Munneke 1997; Cunningham 2006). Teardowns can sometimes be used to measure land values, because land represents the entire value of a property when the existing building is demolished immediately following a sale (McMillen 2006; Dye and McMillen 2007). However, teardowns tend to be concentrated in certain high-value neighborhoods, and the data on demolitions can be hard to obtain.
Among U.S. cities, Chicago is uniquely fortunate to have a data source, Olcott’s Land Values Blue Book of Chicago, which reported estimates of land values for every city block and for blocks in many Cook County suburbs for most of the 20th century. Olcott’s provided a critical input to the cost assessment procedure: After determining the building cost and depreciation, the overall value of a property can be assessed by multiplying the parcel size by the land value provided in the Blue Book series. This article is based on a sampling of data from the Olcott volumes (box 1). It includes a series of maps that provide a clear picture of the spatial evolution of Chicago during the 20th century, similar in spirit to the classic book, One Hundred Years of Land Values in Chicago (Hoyt 1933).
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Box 1: Data Sources for Chicago Land Values
Olcott’s Land Values Blue Book of Chicago covers the City and much of suburban Cook County with a series of 300 maps, each printed on one page of a book. The city itself comprises 160 individual maps with an impressive level of detail. Most block faces have a value representing the price per square foot for a standard 125-foot-deep lot. Land use is also indicated. Large lots and most industrial land have prices quoted by the acre or occasionally by the square foot for an unspecified lot depth. The data represent land values for 1/8- x 1/8-mile square grids, which closely follow Chicago’s street layout and thus resemble city blocks. Each year’s data set includes 43,324 observations for the entire city.
The Lincoln Institute of Land Policy has provided funding to digitize the data contained in Olcott’s Blue Book for a series of years spanning much of the twentieth century: 1913, 1926, 1932, 1939, 1949, 1961, 1965, 1971, 1981, and 1990. A more thorough description of the procedure used is presented in Ahlfeldt et al. (2011). Digitizing the maps involves bringing them into a GIS environment. Average land values are calculated for 1/8- x 1/8-mile squares overlaid on the maps. The full data set has more than 600,000 data points across the 10 individual years.
Olcott’s stopped publication in the early 1990s, and the last year of digitized data is 1990. To supplement Olcott’s records for recent years, the authors obtained data on all vacant land sales in the city from 1980 to 2011. More than 16,000 sales were successfully geocoded, and they display the dramatic increase in land prices during the period prior to the collapse of the housing market at the end of 2006. These combined data sets provide a unique opportunity to analyze the changing spatial structure of an entire city over an extended time.
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Spatial Variation in Land Values
Despite its flat terrain, Chicago has never been a truly monocentric city. Lake Michigan has long been an attractive amenity for its scenic value, its moderating effect on the climate, and the series of parks lining its shore. The Chicago River also has had a significant influence on the location of both businesses and households. Development to the north of the Central Business District (CBD) was delayed because the bridges over the main branch of the river had to open so often for river traffic that commuting to the Loop business area was unpredictable and time consuming. The north and south branches of the river attracted both industrial firms and low-priced residential developments for laborers while repelling high-priced homes designed for CBD workers. The locations of major streets, highways, and train lines also had significant effects on development patterns. Thus, there is ample reason to expect that the rate of change in land values varies across the city.
The maps in figure 1 show this spatial variation in land values in Chicago over time. In 1913, land values were highest in a large area around the CBD, and they were also quite high along the lakefront and along some of the major avenues and boulevards leading out of the downtown area. In 1939, this pattern was generally similar, along with the rise of the north side relative to the south side of the city: Land values were very high all along the northern lakefront and extending well inland on the north side. The area at the edge of the city due west of the CBD (the Austin neighborhood) also had relatively high land values in 1939.
By 1965, the pattern of land values had changed markedly. Very high land values were confined to a relatively small area in the CBD. The high-value area of the west-side Austin neighborhood was much smaller in 1965 than in 1939, and nearly all the formerly high-value areas had shrunk in size.
By 1990, however, the situation changed dramatically. The area with very high values extended much farther north and inland than previously. Areas on the south side had relatively high land values in 1990, particularly around the South Loop (near the CBD) and Hyde Park (along Lake Michigan south of the CBD).
After 1990, the pattern of continued redevelopment of the city is based on an analysis of actual sales of vacant land. The expansion of the high-value area to the north and west of the CBD is remarkable, and the near south side also enjoyed a resurgence during this time.
Figure 2 addresses how the recent recession affected the growth of land values in Chicago by expressing land values as a function of distance from the CBD. The plots show the change in average (log) land values over time for tracts with centroids falling within 2-, 5-, and 10-mile rings around the CBD. In 1913, average land values were far lower 10 miles from the CBD than in the closer rings. By the 1960s, there was little difference between land values across these distances. Since then, average values grew much more in the 2-mile ring than in more distant locations. During the Great Recession, land values declined rapidly in the 2-mile ring, less rapidly in the 5-mile ring, and not at all in the 10-mile ring. Thus, the areas that had the highest rates of appreciation during the period of extended growth also had the highest rates of decline during the recession.
Figure 3 provides a different perspective on the spatial variation in land values over time. The three panels show smoothed land value surfaces for 1913, 1990, and 2005. The 1913 and 1990 surfaces are estimated using Olcott’s data, while the 2005 estimates are based on sales of vacant land. In all three years, land values are far higher in the CBD than elsewhere. In 1913, there are a large number of local peaks in land values at the intersections of major streets. These areas were relatively small commercial districts that served local residents in a time before car ownership was commonplace. In 1990, the land value peak in the CBD is accompanied by a much lower plateau just to the north along the lakefront. In 2005, the plateau has grown to a large area that extends well into the north side and inland along the lakefront. The region of high land values has also extended south along the lakefront, with a local rise much farther south in Hyde Park.
Persistence of Spatial Patterns
Historical land values are interesting not only because they reveal how an urban area has changed over time, but also because the past continues to exert substantial influence on the present. Cities are not rebuilt from scratch in every period. Buildings last a long time before they are demolished, and sites that were attractive in the past tend to remain desirable for a long time. One of the unique features of the Olcott’s data set is that it allows us to compare land values from 100 years ago to current land values and land uses.
Figure 4 shows the average date of construction for the 1/8- x 1/8-mile squares. The recent recentralization of Chicago is evident in the donut shape of building ages around the CBD. The newest buildings are close to the CBD, while the oldest buildings are in the next ring. Buildings in the most distant region were most likely built between 1940 and 1970.
Figure 5 summarizes this relationship by comparing the mean construction date to distance from the CBD. The oldest buildings are in a ring just over 5 miles from the CBD.
A good measure of structural density is the ratio of building area to lot size. Economic theory predicts that structural densities will be high where land values are high. Structures last for a long time. How well do past values predict current structural density? Figure 6 compares the structural density of buildings in the 2003 Cook County assessment rolls to land values in 1913 and 1990. This data set includes the building area of every small (six units or fewer) residential structure in Chicago.
The height of the bars indicates the structural densities: Tall bars have relatively high ratios of building areas to lot sizes. The color of the bars indicates land values: Red bars have relatively high and values. Thus, we should expect to see a large number of tall red bars and low green bars. In general, the two panels do indicate a positive correlation between structural density and land values. The correlation is particularly evident on the north side and along the lakefront. The correlation with 1990 is less clear on the south and west sides. Several elevations in the density surface are not matched by correspondingly high land values. One explanation for these results, which are in line with the reorientation of high-priced areas toward the north side, is that the relatively high densities in these areas are artifacts of a past when those blocks were relatively more valuable and when there were incentives to use the land intensively. The 1913 panel of figure 6 suggests that land values are actually more closely correlated with building densities for 2003 than are the 1990 values. The root of this apparently anomalous result is that building density reflects the economic conditions at the time of construction, and most of the buildings in that part of the city date from long ago. The past continues to exert a major influence on the present.
Conclusion
Olcott’s data provide a clear picture of the changes in Chicago’s spatial structure during most of the 20th century. Never a truly monocentric city, Chicago began the century with very high land values in the CBD, along the lakefront, and along major avenues and boulevards leading out of the downtown area. Values were also high in neighborhood retail areas at the intersections of major streets. By 1939, the north side of Chicago had already begun to display its economic dominance. The city then suffered an extended period of decline, with the CBD holding the only major cluster of high land values in the 1960s. Since then, the city has undergone a remarkable resurgence. High land values now extend over nearly the entire north side, and land values have also rebounded in parts of the south side. Our analysis also shows the strong role that history continues to play in the current spatial structure of the city. A result of this persistence is that land values from a century ago are better than current land values at predicting the density of the current housing stock.
Acknowledgments
The authors thank the Lincoln Institute of Land Policy for generous funding and support, and are grateful to the Centre for Metropolitan Studies at the TU-Berlin for hosting a team of researchers during the project work. Kristoffer Moeller and Sevrin Weights are acknowledged for their great contribution to designing and coordinating the compilation of the data set. Philip Boos, Aline Delatte, Nuria-Maria Hoyer Sepulvedra, Devika Kakkar, Rene Kreichauf, Maike Rackwitz, Lea Siebert, Stefan Tornack, and Tzvetelina Tzvetkova provided excellent research assistance.
About the Authors
Gabriel M. Ahlfeldt is associate professor at the London School of Economics and Political Sciences (LSE) in the Department of Geography and Environment and Spatial Economics Research Centre (SERC).
Daniel P. McMillen is professor in the department of economics at the University of Illinois at Urbana-Champaign.
Resources
Ahlfeldt, Gabriel M., Kristoffer Moeller, Sevrin Waights, and Nicolai Wendland. 2011. “One Hundred Years of Land Value: Data Documentation.” Centre for Metropolitan Studies, TU Berlin.
Ahlfeldt, Gabriel M., and Nicolai Wendland. 2011. “Fifty Years of Urban Accessibility: The Impact of the Urban Railway Network on the Land Gradient in Berlin 1890–1936.” Regional Science and Urban Economics 41: 77–88.
Atack, J., and R. A. Margo. 1998. “Location, Location, Location! The Price Gradient for Vacant Urban Land: New York, 1835 to 1900.” Journal of Real Estate Finance & Economics 16(2) 151–172.
Colwell, Peter F., and Henry J. Munneke. 1997. “The Structure of Urban Land Prices.” Journal of Urban Economics 41: 321–336.
Cunningham, Christopher R. 2006. “House Price Uncertainty, Timing of Development, and Vacant Land Prices: Evidence for Real Options in Seattle.” Journal of Urban Economics 59: 1–31.
Dye, Richard F., and Daniel P. McMillen. 2007. “Teardowns and Land Values in the Chicago Metropolitan Area.” Journal of Urban Economics 61: 45–64.
Hoyt, Homer. 1933. One Hundred Years of Land Values in Chicago. Chicago: University of Chicago Press.
McMillen, Daniel P. 2006. “Teardowns: Costs, Benefits, and Public Policy.” Land Lines, Lincoln Institute of Land Policy 18(3): 2–7.
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Low-income, self-managed homestead subdivisions, called colonias in Texas, are a rapidly expanding form of land and housing production in the United States. In a recently completed Lincoln Institute-supported study, I have analyzed the dysfunctional aspects of these land markets as measured by a high level of absentee lot ownership, modest lot and property transactions and turnover, and a lack of significant valorization (value increment) as settlements are built through and improved.
Homestead Subdivisions
Colonias, the Spanish word for neighborhoods, were first identified in the poorest Texas counties along the border with Mexico. They comprise unserviced or poorly serviced settlements in which homesteaders have bought a lot upon which they place either a trailer-type dwelling, or its up-market and less mobile or portable form, the “manufactured home.” In some cases, families build their homes through self-help efforts, beginning residence in a shack, camper or second-hand trailer and later consolidating the home over time.
Colonias are not a small-scale phenomenon. According to the Texas Water Development Board, there are approximately 1,500 such settlements housing around 400,000 people, mostly in the border region. The Board’s data and my own survey results show that many similar types of homestead subdivisions exist elsewhere in Texas, so these population estimates are likely to increase as we learn more. Indeed, counties throughout Texas, and in other states as well, are beginning to recognize the problems of unregulated substandard subdivisions that offer one of the few affordable homestead options for low-income households.
Low income here refers to households earning between $12,000 and $25,000 a year, although many colonia households actually earn much less (see Table 1). These households are in poor labor market areas: either regions experiencing wage and labor polarization among workers, or where low-paid service sector jobs predominate. Housing costs in most cities place home ownership beyond the reach of households that seek accommodation within the lower end of the rental housing market, in apartments or in trailer parks. Yet, many of these households aspire to homeownership, recognizing the advantages of moving out of rental housing where they have no equity. Many of them favor homesteading in poorly serviced rural subdivisions where they can own and valorize property through mutual aid and self-help efforts.
Colonias are not homogeneous, however. They vary markedly in size, layout, mode of development, mix of housing types, lot dimensions, lot occupancy and residential turnover rates, level of servicing, ethnic composition, income levels, and levels of relative poverty. In Texas, there is no typical colonia, but rather a range of types that vary among counties.
These settlements are akin to so-called irregular settlements in less developed countries, and they have a similar rationality to explain their existence: a low-wage economy, a rising demand for housing, a lack of state housing supply systems capable of meeting demand, and a private sector uninterested or unable to produce housing at levels that people can afford. Like their counterparts in Mexico and Latin America, colonias offer low-cost unserviced land on the fringes of urbanized areas that is affordable and accessible to very low-income groups. Most residents must commute substantial distances into the adjacent cities for work.
While colonias in Texas are rarely illegal, many aspects of the development process are informal or quasi-formal, most notably:
Just over a decade ago, Texas became aware of the existence and proliferation of colonia-type subdivisions, and in biennial legislative sessions began to take action to stop their growth on the one hand, and to simulate upgrading on the other. Following are some examples of legislative action over the past decade:
An underlying weakness in all these initiatives is that they apply only in the border region and in specially designated counties that form part of the state’s Economically Depressed Areas Program (EDAP). Elsewhere, the process continues essentially unabated.
Vacant Lots and Absentee Ownership
A major indicator of land market dysfunction is the failure to occupy and develop a lot after it has been sold. The data show that between 15 and 80 percent of colonia lots may be vacant. Even in the largest and now often fully serviced settlements, as many as one-quarter to one-sixth of lots are held vacant by absentee lot owners. Moreover, relatively large lot sizes of one-eighth to one-half acre or more, together with prohibitions on lot subdivision and sharing, create very low densities of 10 to 12 persons per acre. This exacerbates the unit cost of providing services, reduces cost recovery, and weakens community cohesion and mutual aid. Weestimate that there are over 26,000 vacant lots in Texas comprising more than 7,000 acres of unoccupied residential land. If these lots were fully populated, even at the prevailing low densities generally found in colonias, an additional 100,000 people could be housed in existing settlements alone.
A key question, then, is why so many low-income households do not occupy their lots? Conventional wisdom argues that the lack of services discourages potential residents, and that providing basic utilities would be a catalyst to lot occupancy. However, this argument begs the question why many people do occupy their lots from the outset. They can be asked about their motives and decision-making process, but it is more problematic to question absentee lot owners who are difficult to trace. Who are they? Where are they? What do they want from their land?
In spite of the methodological conundrum caused by the lack of a clear paper trail from property conveyance records and lot titles, we were able to develop a research strategy using property appraisal and tax records to track down some of these absentee lot owners. However, an estimated 8 to 10 percent of these records were discovered to be “bad” addresses, with the probability that the actual number of untraceable lot owners may be twice as high. Having walked away from the land they bought, these lot owners are in effect locking their property out of future land market transactions.
Current Place of Residence of Absentee Owners
By using tax record data for some 2,713 absentee lot owners across 16 survey settlements (in border and non-border counties), it was possible to identify the current location of absentee owners.
Around three-quarters live locally, i.e., in the adjacent city or within 20 miles. The rest are non-local, split equally between those living elsewhere in Texas and those living out-of-state. While there was a broad spread of addresses across the state, most absentee lot owners lived in Houston (26 percent), Dallas (15 percent) and San Antonio (12 percent)-the three principal metropolitan areas of Texas. California, with 35 percent of all out-of-state absentee addresses, was the most frequently identified state, followed by New Mexico (14 percent), and the Chicago region (Illinois and Indiana with 12 percent).
Characteristics of Occupants and Absentee Owners
This research reveals that colonia occupants and absentee lot owners are substantially different populations (see Table 1). Absentee owners are more likely to be Mexican-American, and are more ethnically diverse. While poor, they are considerably better off than colonia residents. Generally, the absentee owners purchased their lots earlier, and therefore paid less in real terms.
The most dramatic differences between the groups emerge in their residential search behavior and their motives for purchase. Absentee lot owner households are not waiting in the wings to move onto their lots once servicing has been provided. Quite the opposite: most of them (81 percent) are homeowners already and appear to be quite comfortable in their current residence. Moreover, some 49 percent indicated they bought their lot not for themselves but as an investment, as security, or as a future gift or inheritance for their children. Less than one quarter stated that the lack of existing services was an issue. More than half expressed no future intention to move onto the lot, and of those who do intend to move, very few plan to do so in the next 5 to 10 years. In reality I anticipate that few will ever move. Some even said they would sell at any time if the price was right.
Land market performance for both populations during the past two decades is unlike other residential land markets. Land value trends in colonias have remained “flat” in real terms, and the rate of return has been low, especially compared with other sectors of the land and housing market. This suggests that the poor are not benefiting significantly either from their land purchase investment or from their sweat equity (in the case of residents). Although a modest level of market sales continues to take place (more than was anticipated), colonia land markets are not being valorized significantly.
Policies for Fixing the Market
Vacant lots are both a cause and an effect of this poor market performance. It is important to note that the “build-it-and-they-will come” notion is badly misconstrued. Policies to develop urban services in order to catalyze lot occupancy and densification may be helpful, but other land market interventions are also required to make land markets in colonias operate more efficiently. These might include revising legislation to facilitate urban productivity, such as allowing for some nonresidential land use for income production, or for subdivision and rental. Indeed, one reason why land is not being valorized is the restriction placed upon approved land uses. The 1995 moratorium on lot sales also limits development. Although the law is widely breached, doing so deflates prices, distorts turnover and drives sales underground. The prohibition upon internal lot subdivision (especially of large lots) inhibits rent-seeking and cost-sharing among kin.
Another need is to free up the land-locked areas that belong to owners who can no longer be traced. Sequestration of lots for nonpayment of taxes could be one approach, especially if tied to the creation of a public holding company or land trust that would subsequently promote the supply and redistribution of lots through mechanisms such as land pooling and land readjustment. In Texas, at least, tackling the “problem” of large-scale absentee lot ownership would offer a number of positive outcomes and solutions.
Understanding and widening our analysis of homestead subdivisions in Texas and elsewhere offers the potential that policy makers will be better informed, and that we may begin to develop more sensitive and appropriate land policies to address the issue. In so doing, we may substantially increase the supply of homesteading opportunities to the most disadvantaged income groups in U.S. society.
References
Peter M. Ward. 1999. Colonias and Public Policy in Texas and Mexico: Urbanization by Stealth. Austin, TX: University of Texas Press.
______. 2000. Residential Land Market Dynamics, Absentee Lot Owners and Densification Policies for Texas Colonias. Lincoln Institute Working Paper. WP00PW1. 160 pages. $18.
Peter M. Ward holds the C.B. Smith Sr. Centennial Chair in US-Mexico Relations at the University of Texas-Austin, where he also is a professor in the Department of Sociology and at the Lyndon B. Johnson School of Public Affairs.
