Formalisation of the squatting housing thought financialization

Akyüz S.

Financialization and Development in the Global South, Buenos Aires, Argentina, 26 - 28 November 2019, pp.1-30

  • Publication Type: Conference Paper / Summary Text
  • City: Buenos Aires
  • Country: Argentina
  • Page Numbers: pp.1-30
  • Abdullah Gül University Affiliated: Yes


With the rise of the power of the finance capital after the 1980s, the amount of indebtedness of households, companies and states increased dramatically. My presentation will explain how these debts have been used in order to formalise housing of the urban poor in the case of Ankara Turkey. 

The creation of investment pools allows the accumulation of very large capital to facilitate the production of the built environment in the big scale projects (Fainstein, 2014). These increases in the production of the built environment show in the rise of production of commercial properties, increases in the number of infrastructure projects and increases in housing production. These developments in the MDCs were crucial in shaping housing policies and strategies in the LDCs (Jones, 2012; Rolnik, 2013). By interacting with the global pool of finance capital, the national housing systems are transforming towards an Anglo-American, liberalised mode of housing finance. The influx of capital into housing occurred all around the world; while the MDCs experienced this influx starting in the 1990s, the LDCs started to experience it after the 2000s (Aalbers, Loon and Fernandez, 2017). More recent research focuses on the formalisation of working class housing through financialization. As in the case of Brazil and Mexico the formalisation and housing production for low income group always depends on state intervention  (Klink and Denaldi, 2014; Soederberg 2015)

Turkey also has been experiencing a similar process since 2000s; the transition of the self-help squatting housing to formally build flats. In 2005, around 30% of the urban population of the Turkish Capital, Ankara were still living in squatter settlements (Ankara Metropolitan Municipality, 2005). With the restructuring of the financial system due to the 2001 banking crisis, the role of finance capital in the economy further increased. With the new regulation, the medium and low-income groups were integrated into the new credit systems, such as the mortgage system. With the rise of the finance and service sectors in the economy, city governments wanted to restructure. These are large-scale restructuring projects aiming to intervene in nearly all of the built environment of cities. Based on the 2007 Ankara development plan, in total the planned areas of Ankara are around 80,000 hectares, and 31,235 hectares – 39% of the planned areas of Ankara have been declared Redevelopment Areas by Ankara Greater Municipality. 

Since 2002, there has been an unprecedented wave of investment in the built environment started, supported with national and international finance capital. Since then the production of the built environment and especially of housing has increased dramatically, from 202,000 dwellings in 2003 to 1,000,000 dwellings in 2016 (TUIK, 2016) for whole Turkey. 

The new model targeted large scales of housing production through direct state production or public-private partnerships. In harmony with international housing policies, with the introduction of new housing finance models since 2003, private housing credit became the tool of secure-income groups. The Mass Housing Agency housing credit, on the other hand, targeted low-middle income earners’ integration to formal housing production. The new system integrated finance with housing provision whilst simultaneously formalising it. Ever more people accessing housing credit means the state do not allow construction of squatting housing (gecekondus) anymore, instead making people borrow from the Mass Housing Agency or from private banks. 

In consequence, after 2005 the Ankara Metropolitan Municipality directly intervened in the gecekondu neighbourhood by using its planning powers and resources. In this intervention, the Metropolitan Municipality took ownership of the land by signing agreements with the residents based on a flat-for-land sharing model. In this model the municipality do not legalise the gecekondu land anymore, but accept previously legalised conditions of ownership.