The region faces a housing deficit, where the problem is not only in the demand but also in the cost and informality

Latin America no longer has living places for so many people. The region, despite being composed of large cities, does not cover the basic needs of decent housing. According to the United Nations, in its latest study on housing prepared by UNDP, "the 50 most populated cities in the region, with a population of over 1,300,000, are 15 in Brazil, seven in Mexico, five in Colombia, five in Venezuela and the remaining ones to one or two in the other countries".

Leer en español: Latinoamérica no tiene techo para todos

The main cities, by commercial, economic importance, and social centers, are Mexico City and Sao Paulo. Both places exceed 20 million inhabitants each; Buenos Aires continues with nearly 16 million; Rio de Janeiro has just over 12 million; Lima and Bogotá have 10 million each. Finally, the next group of cities houses five million and they are spread more widely on the continent.

Where do so many people sleep?

The problem of large cities is not the number of inhabitants, but the demand for housing that, in all the cities mentioned, is much higher than the supply. However, the offer is not specifically in terms of formal housing, which then generates that to solve the problem people opt to informal housing. In other words, informality refers to dwellings that occupy a place not intended to be built, but over time local administrations provide them with public services in order to inhabitants to have access to the basic services that the law protects. These informal homes, according to the report of the Inter-American Development Bank (IDB), entitled Seeking House for Rent, argues that about 53% of homes in Latin American cities are informal.

That same study ensures that 37% of the homes that people buy have a deficit, mainly qualitative. This means that many of these houses "do not have property titles, lack basic water, electricity, transportation, inadequate infrastructure, and are located in settlements or in high-risk areas."

Due to this circumstance in Latin America, people now prefer to rent instead of buying, which leads to properties for sale become a category that does not generate profits. On the contrary, an empty housing stock is created that forces investors to be careful to capitalize in new projects.

What can be done?

According to UNDP data, rural dwellers are going to cities, so the growing demand for housing makes available land a coveted and limited item. Local administrations, relying on urban designers, the private sector, and the demanding society, should start working on long-term urban plans. The new administrations must continue with the incentive to build and formalize housing. These plans are programs of 15 or 20 years, whose only consequence is to generate sustainable cities with better indices of quality life for the inhabitants.

Along with this, plans for access to own housing must be implemented. Many of the families in the region, according to the IDB, cannot access the mortgage plans, which forces them to design and gradually build their homes.

More than half of the families in Caracas, La Paz, Buenos Aires, Sao Paulo, Rio de Janeiro, Mexico City, Quito, and Managua suffer from this situation, which also implies delays in the construction and fulfillment of the basic needs of living place.

While this utopian desire for social development is reached, local administrations can promote housing rental plans that provide people with basic needs and that are not marginalized. In other words, the private sector has the opportunity to get involved and even formalize a business to increase the supply of housing and protect investors from the housing bubble.

Latin American Post | Carlos Eduardo Gómez Avella
Translated from “ Latinoamérica no tiene techo para todos”