Lack of basic information on the nature and diversity of informal settlements, and the workings of the informal property markets represents an important limitation on the capacity of policymakers to develop appropriate policies aimed at improving the lives of the urban poor. This paper, published by the Sanford School of Public Policy at Duke University, is based on an extensive study undertaken in Bangalore over seven years. Following interviews with more than 4,500 slum residents, the paper presents hitherto little-known facts about the informal housing sector in India, leading to important policy recommendations.
- Official maps severely undercount the number of slum dwellers and existing slums in the city.
- Slum conditions steadily improve along a wide-ranging continuum, which therefore calls for policies which are responsive to their specific needs. There is no one-size-fits-all policy for slums.
- The acquisition of property rights occurs through a series of incremental gains in slums, with households collecting a variety of property documents as proof of their residence in the neighborhood.
- An active informal market‐place exists that produces quasi-official documents and helps buyers and sellers transact informal properties, overcoming the limitations of their property papers.
- Even among notified slums, households continue to have limited linkages with formal financial markets, especially housing finance. Moreover, the incremental returns for households with “titles” are disappointing.
- Rather than being a conveyor belt leading to urban middle-class status, evidence points to very low upward mobility prospects in slums.