2.2.2 Formalizing Property Right and Tenure Security 1 FORMALIZING PROPETY RIGHTS AND TENURE SECURITY UPA Package 2, Module 2

2.2.2 Formalizing Property Right and Tenure Security 2 Limited land transactions Lack of access to mortgages Restrained revenue generation by local authorities Restrained investments in land and local economic development Insufficient service provision Increases the vulnerability of the urban poor Impacts of Unclear Property Rights

2.2.2 Formalizing Property Right and Tenure Security 3 Property systems may be formal or informal Concept of formal and informal property

2.2.2 Formalizing Property Right and Tenure Security 4 Formal property systems are those where the interests are explicitly acknowledged and protected by the law. This is the case for the vast majority of property rights in developed countries. Concept of formal and informal property

2.2.2 Formalizing Property Right and Tenure Security 5 Informal property interests are those that are recognized by the local, informal community but which are not formally acknowledged by the state. They exist in most developing countries outside the legal system and are often the result of inadequate legislation, or excessive and inefficient bureaucracies. Concept of formal and informal property

2.2.2 Formalizing Property Right and Tenure Security 6 Figure 1: Informal land occupation in urban areas by region Concept of formal and informal property

2.2.2 Formalizing Property Right and Tenure Security 7 Security of Tenure Tenure security is defined as: “...(i) protection against eviction; (ii) the possibility of selling, and transferring rights through inheritance; (iii) the possibility... (of having a)... mortgage, and access to credit under certain conditions” (FIG/UNCHS:1998:18) Concept of formal and informal property

2.2.2 Formalizing Property Right and Tenure Security 8 Possible actions to establish clear property rights and tenure security: Provide tenure security to the urban poor Sell with clear title Abolish the site improvement requirement Concept of formal and informal property

2.2.2 Formalizing Property Right and Tenure Security 9 Three basic types of land reform programme may be identified: Those mainly of a legal, technical and/or administrative nature, carried out primarily to make the infrastructure work more effectively (for instance land consolidation, legislative or tax reform); Those designed to deal with the more basic concerns for minimizing tenure insecurity (such as property formalization); Those designed to tackle the even more fundamental challenge of inequality of ownership (such as land redistribution or settlement). Land Reform and Formalization

2.2.2 Formalizing Property Right and Tenure Security 10 Land formalization will normally begin with a process known as adjudication of title to land. Land Reform and Formalization

2.2.2 Formalizing Property Right and Tenure Security 11 Land Titling: Many projects were initiated, the typical components of which included: Improvements to the legal framework and statutes; Regularization of possessory titles (adjudication and registration); Cadastral surveying and mapping; Information technology support; Institutional strengthening and project management support; Human resources development Land Reform and Formalization

2.2.2 Formalizing Property Right and Tenure Security 12 Figure 2: Impact of title status on land values, selected countries and years The Benefit of Land Formalization and Titling

2.2.2 Formalizing Property Right and Tenure Security 13 Figure 3: Impact of title status on investment, selected countries and years The Benefit of Land Formalization and Titling

2.2.2 Formalizing Property Right and Tenure Security 14 Figure 4: Impact of title status on access to credit, selected countries and years The Benefit of Land Formalization and Titling

2.2.2 Formalizing Property Right and Tenure Security 15 1.What are the impacts of unclear property rights? Why is security of land tenure so important for the urban poor? 2.What difference does titling make in the lives of the urban poor? What are the other viable options for supporting tenure security? Group Discussion

2.2.2 Formalizing Property Right and Tenure Security What are the different forms of land ownership in your city? Is illegal occupation of public land widespread in your city? What percentage of land is illegally occupied? How does your city deal with illegal occupations? 4. Which possible actions would be effective in your country and city? Do you think any other actions would be necessary to solve the particular property rights problems in your city (country)? Group Discussion