The Silent Intruder Disrupting Mexico’s Housing Dream

Housing: a word that conjures up visions of stability, security, and the warm, fuzzy notion of having a roof over one's head. But in Mexico, as Deputy Lilia Aguilar Gil aptly points out, the housing market is entangled in the thorny vines of speculation, political maneuvering, and a frustrating housing deficit that haunts the dreams of millions. Aguilar, in her dual role as PT deputy and president of the Housing Commission, is no stranger to the perplexing paradoxes of the housing market. In a landscape where abandoned homes outnumber prospective homebuyers, how did things get so topsy-turvy?

"The problems have not changed, they have evolved," Aguilar notes with the resigned air of someone staring down an old foe with a few new tricks up its sleeve. She talks about the housing deficit—currently estimated at a staggering 7.1 million people clamoring for homes, while a baffling 8.7 million homes sit empty, like ghost towns in a Western movie, haunting Mexico’s sprawling urban edges.

These abandoned homes are the legacy of a bygone era where construction was less about community and more about quotas. Houses were built in locations that made no sense for actual living, and neighborhoods sprang up where no one wanted to be. It was less about addressing a real need and more about racking up numbers—housing development as a hollow shell of its intended purpose.

But it isn’t just the placement of homes that’s at fault. The housing credit system—once a means of empowerment—has devolved into a sluggish mechanism. Credit has dried up faster than a puddle in the desert, making it nearly impossible for ordinary Mexicans to buy a home. And yet, the market isn’t shrinking, it’s warping.

One of the most mind-boggling phenomena Aguilar mentions is how the Mexican housing market managed to develop an overstock of homes while still having millions who can’t afford one. It’s the kind of riddle that would make a real estate enthusiast weep.

As Aguilar explains, this isn’t just the result of poor urban planning. The issue is a cocktail of market failures, exacerbated by political favors and backroom deals. At one point, opportunists—who seemingly materialized overnight—jumped into the lucrative world of housing construction. Social housing took a backseat, and the focus shifted to high-end developments, aimed at profit rather than public need. The result? A housing market as inaccessible as it is overbuilt.

And then there’s the curious case of Fonhapo—a housing fund once designed to be the hero of Mexico’s most vulnerable citizens. Fonhapo had social logic baked into its very foundation, offering housing support for those who needed it most. But alas, in Aguilar’s telling, it’s a tale of how idealism meets financial mismanagement. What should have been a lifeline for affordable housing was instead siphoned off by the powers that be—used, ironically, to line the pockets of political insiders.

Fonhapo’s demise, as Aguilar puts it, wasn’t a gradual decay, but a spectacular financial collapse. The fund was left bankrupt, hollowed out by those who saw housing not as a fundamental right, but as a short-term cash cow. The result? A nation with a gaping hole where its social housing strategy should be.

Adding to the complexity of the housing issue is the inexorable march of gentrification. As Mexico's urban areas continue to grow, gentrification has begun to quietly reshape the fabric of cities. What was once affordable and diverse housing has turned into trendy neighborhoods for the wealthy, pushing lower-income families further to the fringes. And yet, gentrification is often framed as "development"—a sneaky rebranding that hides the displacement of long-standing communities beneath shiny new facades.

Aguilar, alongside her colleagues in the Chamber of Deputies, has been working to address this through legislative reforms, particularly with programs like Fovissste and Infonavit. But fighting against the tides of speculative development, entrenched political interests, and gentrification is no small task.

Speculation and Housing Crisis

At the heart of Aguilar's mission is a transformative idea: when individuals secure a mortgage, their home should not serve merely as collateral. Instead, it is a right that can no longer be seized. To this end, modifications have been made to the National Code of Civil and Family Procedures, effectively redefining the house’s role in financial transactions. This pivotal change ensures that a home cannot be used as a mortgage guarantee, thus compelling lenders to seek alternative forms of collateral.

In a move that underscores the evolving nature of housing rights, constitutional reforms have shifted the focus from collective familial rights to individual entitlements. This evolution not only empowers individuals but also aligns with President mandates aimed at revitalizing institutions like Fovissste, which had previously faced significant financial challenges.

By transforming credits from UMA (Unidad de Medida y Actualización) to pesos, the government aims to facilitate easier repayment for those who have demonstrated a commitment to their obligations—specifically those who have paid their credits more than twice. Such reforms extend to Infonavit, adjusting the parameters of credit from minimum wages to pesos, thus allowing for a more manageable approach to home financing.

Aguilar has championed collaborative housing policies, working closely with Infonavit to ensure that no more than 30% of an individual's salary is allocated to housing payments. This measure protects not just the working population, but also respects the financial well-being of retirees and pensioners, ensuring that their pensions remain intact.

Among the standout initiatives is the focus on first-time home buyers, particularly young individuals and heads of households. These programs are designed to empower a new generation, making homeownership a tangible goal rather than an elusive dream.

Reflecting on the progress made, Aguilar highlights the Housing Commission's ability to garner consensus on a range of reforms. The legal amendment of Article 4, which mandates modifications to 53 legislative instruments, is a cornerstone of this effort. It establishes that housing must be "adequate, measurable, and achievable," ensuring that it is affordable, livable, and well-located, with access to essential public services.

This legal overhaul promises to reshape public housing policies across the country, transforming the financial landscape for prospective homeowners. In regions like Ciudad Juárez, where nearshoring has inflated housing prices—forcing social interest homes to soar past one million pesos—these reforms are desperately needed. With a minimum wage of eleven thousand pesos, the reality is clear: affordable housing must become a priority, or dreams of homeownership will remain just that—dreams.

Reimagining Housing as a Right

Aguilar firmly asserts that housing is not merely a commodity but an essential human right. This perspective marks a pivotal shift in the regulatory framework governing housing. “When you obtain a mortgage,” she states, “the house is not a guarantee; it can no longer be seized.” This concept stems from recent modifications to the National Code of Civil and Family Procedures, which now mandates that homes cannot serve as collateral for loans. Instead, alternative commodities must be identified to secure credit, thereby protecting families from the risk of losing their homes.

The evolution continues with constitutional reforms that have transitioned the right to housing from a familial collective to an individual entitlement. This shift emphasizes the autonomy of individuals in securing their living conditions, reflecting a modern understanding of personal rights. Coupled with this change, reforms to the Fovissste—once on the brink of insolvency—have transformed credit structures from Unidad de Medida y Actualización (UMA) to pesos, allowing for a more manageable repayment process, especially for those who have already made significant payments.

Aguilar highlights a cooperative effort with Infonavit, emphasizing a cap on mortgage payments at no more than 30% of an individual’s salary. This consideration extends to retirees and pensioners, ensuring that their financial security is safeguarded as they transition into a new stage of life. Moreover, the focus on first-time homebuyers, particularly young adults and single heads of households, underscores a commitment to fostering inclusive housing opportunities.

Reflecting on the Housing Commission’s achievements, Aguilar notes the overwhelming consensus on legislative reforms, particularly the significant adjustments to Article 4 of the Constitution. This reform compels the revision of 53 legislative instruments, establishing that housing must be “adequate, measurable, achievable.” Such criteria demand that homes are not only affordable but also livable, strategically located, and equipped with necessary public services.

In regions like Ciudad Juárez, the impact of speculative pressures is palpable. Aguilar points out the alarming inflation of housing prices, where a house of social interest can no longer be found for under one million pesos, an astronomical figure compared to the minimum wage of eleven thousand pesos. This discrepancy creates a daunting challenge for prospective homeowners, as monthly payments on social housing loans become unattainable for many.

The measures outlined by Aguilar are designed to combat these market distortions, aiming to recalibrate the housing sector towards affordability and accessibility. The open parliament initiative, which spanned from Yucatán to Ciudad Juárez, has been instrumental in gathering diverse opinions and fostering dialogue on these critical issues.

The Great Land Grab

Imagine, if you will, a country where a mere seven families control vast swaths of land. Through strategic maneuvering—buying land from ejido members and tweaking the National Agrarian Registry (RAN)—these families have quietly amassed a disproportionate percentage of Mexico’s most coveted territories. The effects of this clandestine land grab ripple through states like Chihuahua and the tourist-dense Riviera Maya in Quintana Roo, turning once accessible areas into exclusive enclaves.

This speculative empire-building is not merely a quirk of the market but a deliberate orchestration of economic power. By monopolizing land and driving up property values, these families have helped create housing bubbles that are impossible for average citizens to penetrate. What’s worse, it’s perfectly legal—or at least it has been. Aguilar’s stance is unequivocal: speculation must be recognized as a crime, punishable by more than a slap on the wrist.

So, how does one dismantle such a deeply ingrained system of speculation? According to Aguilar, the first step is simple: call it what it is—a crime. But she doesn't stop there. Her approach blends the punitive and the pragmatic, proposing not only criminal sanctions but also reforms like the progressive property tax. The idea is to make hoarding land or homes purely for speculative purposes financially untenable. These measures, she argues, will curb the practice of snapping up properties and sitting on them until market prices skyrocket, leaving affordable housing a distant dream for the average citizen.

Of course, where speculation thrives, gentrification isn’t far behind. Aguilar delivers a stinging critique of those who romanticize gentrification as a mechanism for urban renewal. With characteristic wit, she dismisses the notion of gentrification as a path to neighborhood improvement: “They even tell you: value your home, it will improve security and improve the neighborhood because there are beautiful people. That is totally absurd.” For her, this is nothing short of a housing caste system—one that allocates access to property based solely on economic status.

The solution? Mixed land use. Aguilar advocates for integrating commercial, residential, and even recreational spaces in a single area to foster organic growth and diversity, rather than the soulless, speculative enclaves cropping up in states like Yucatán and Nayarit. There, gated communities—sold at inflated prices and wrapped in the allure of exclusivity—are the new normal. This trend exacerbates the problem of segregation, pricing out the very communities that once thrived in these regions.

With all these ambitious proposals on the table, one question looms: can such sweeping reforms actually pass? Aguilar is optimistic, and for good reason. The Housing Commission has garnered support across party lines, and although the PRD may be absent from the conversation (lacking a representative in the commission), the rest of the political spectrum is on board. The open parliament sessions held throughout the country have drawn a broad consensus: housing can no longer be treated merely as a business. It’s a human right, and the laws must evolve to reflect this reality.

In-text Citation: (Espinosa Torres, 2024, pp. 30-31)