Informality: Housing necessity or property opportunity?

Recent decades have seen a rising interest in the peripheral nature of urbanization processes. While research has put the spotlight on large-scale, transnational and financialized real estate actors, less attention has been paid to informal land developers. In a new article, Prof. João Tonucci (Center for Development and Regional Planning, Federal University of Minas Gerais) investigates the key role of informal land developers in the Metropolitan Region of Belo Horizonte (MRBH), Brazil, over the last two decades (2000s and 2010s).

Through a mixed-methods approach, the article provides new evidence of the widespread, variegated, and spatially uneven development of irregular and clandestine subdivisions in the region. It reveals a heterogeneous landscape of informal developers operating on the margins, comprising small and medium-sized companies, individual landowners, public bodies and even non-profit entities. Unlike squatters, autoconstructors, and social movements that out of necessity build cities from scratch, informal developers are mostly motivated by speculative property opportunities arising at the margins. This highlights the relevance of studying this heterogeneous group of actors that, alongside residents, landowners and the state, are crucial for understanding commodified forms of informal urbanization.

The study also demonstrates that informal land development has been shifting from the typical popular and peripheral subdivision, which provided precarious yet affordable housing for working-class families, to new forms of speculative investment for the middle and upper classes, such as country homes and gated communities in peri-urban and rural areas. The author argues that this shift and the greater heterogeneity of informal land development are explained in the Brazilian case by both national and local changing regulatory frameworks and broader processes of economic restructuring, urban neoliberalism and housing financialization in the periphery. In light of this, he proposes the notion of ‘property-led informality’ to refer to a regime of informal urbanization increasingly dominated by commodified, rentiership and speculative land dynamics in the global South’s sprawling metropolises.

By unpacking the entanglements of informality and property through a focus on land developers at the urban margins, this work provides a more complex and nuanced understanding of urban informality and peripheral urbanization in the global South.