03.3 HOUSING POLICY AND FINANCE INSTITUTIONS
Brazil is experiencing a housing crisis: the housing deficit has reached 7.78 million homes70 while 7.9 million homes sit vacant,71 land is concentrated among private landlords, and 3.1 million Brazilian families are spending more than 30% of their incomes on rent.72 The country has frequently attempted to address these issues, largely through ineffective private sector solutions and subsidies that have failed to provide housing for the low-income families that need it most. Although housing policy has become more progressive in recent years – largely pushed by social movements like UMM-SP – the data make clear that these efforts are far from sufficient. One of the biggest issues facing housing policy is the discontinuity of programs across political administrations and the weak financing mechanisms for self management under the last few programs. These issues reemphasize the need for a bill to promote self management through permanent funding streams at the national level.
HISTORY OF HOUSING POLICY Over the past century, housing policy in Brazil has undergone several periods of distinct transformation. This section provides a policyfocused overview of housing in Brazil that begins with the early pre-industrial decades of the twentieth century, increasing urbanization and industrialization, reforms through the military government, and the more recent decentralization of housing policy.
1900 - 1940: THE PREVALENCE OF RENT
1900 - 1940
In this period following the urban housing shortage of the late 19th century, housing for low-income households was supplied entirely by the private sector.73 The poor infrastructure and sanitary conditions of cortiços, or slum tenements, posed health and safety hazards for residents and were an unsustainable response to the growing urban population. After Brazil’s 1930 revolution, increasing industrialization led to urban migration that strained the existing housing supply.74 The government intervened to regulate the rental housing market with stricter construction and sanitation standards and new legal protections for tenants.75 These policies began a period of tighter rental housing controls that gave way to an era of homeownership.
1940 - 1980: FROM REGULATING RENT TO PROVIDING MORTGAGES
1940 - 1980
The 1940 Inquilinato Law froze rent rates in order to incentivize affordability. At the time, rental housing accounted for 75% of the total housing stock in Brazil, but gradually gave way to a higher proportion of homeownership and privatization over the following decades.76 The 1946 Fundação da Casa Popular was established as the first government institution designed to stimulate new housing financing and construction to benefit low- and medium-income households — and though it operated until the rise of the military dictatorship in 1964, a lack of funding limited the number of units created through this foundation to just 18,000 in total.77 B A C K G R O U N D M AT E R I A L • 3 7
