Looking Beyond Land Titling and Credit Accessibility for the Urban Poor

In this paper, Edésio Fernandes argues that the designs of large-scale titling programs have been based on erroneous assumptions about the formation of informal settlements. This error, Fernandes argues, has created a legal environment that fosters informal land market development.

Fernandes believes that income and social networks are more prominent factors than formal titles for obtaining bank loans in Latin America. He asserts that establishing secure private property rights alone cannot solve the problem of poverty. The poor need to be integrated into the market economy. Public investments in infrastructure, affordable housing, and social services are required to upgrade urban living conditions. The key solution for informal land development is to understand factors that affect informality, including the definition of property rights, planning law, conditions of urban management, and the judicial system.

Fernandes also suggests an integrated approach for land regularization programs that contains both remedial and preventive policies. These include the promotion of socio-spatial integration and democratization of access to land and housing. He emphasizes that policy makers should pay special attention to different tenure arrangements for varied urban settlement settings, the objectives and scale of the plans, technical criteria for implementation, and institutional and financial capacity to support the projects.

This paper was presented at the Lincoln Institute’s annual Land Policy Conference in 2008 and is Chapter 12 of the book Property Rights and Land Policies.