The future of informal settlements: lessons in the legalization of disputed urban land in Recife, Brazil

The aim of this paper is to explore the relationship between legalization of land tenure and people's capacity to compete for and sustain their stake in the urban land market. Two aspects of land regularization are taken into account: the benefits of land regularization (as collateral for investments); and the perverse aspects of disputes over improved land (due to increased scarcity of illegal, but affordable housing land). Most research on illegal urban land has systematically investigated how to legalize illegal settlements to improve the effectiveness of service provision, whilst attracting public investments. But, few understand the underlying factors motivating people to improve and consolidate their houses where no legal tenure exists. The absence of substantial understanding about people's perceptions of their tenure security has encouraged most research to conclude that improving tenure security leads to higher levels of housing consolidation. What this paper shows is that the relationship between people's perceptions of land tenure security and housing consolidation is much more malleable and complex than conventionally assumed. The subtle difference between tenure of the land and tenure of the house indicates that people are willing to invest in their housing conditions almost irrespectively of their land tenure situation. This finding challenges the orthodox views of the property rights school of thought. In addition, this paper contends that what legalization is really doing is to reduce the available land stock for the poorest families, because legalization decreases the amount of illegal land (illegal land is undesirable, but affordable for the poor). The orthodox legal system needs to be revised to include the poorest families in the urban society of the new millennium.