New legislation for sustainable development of Mexico's real estate sector

The expected scenario for the real estate sector in Mexico City – the largest urban concentration in the country – is strong stable growth. This is due to the conclusion of policies, including the National Housing Policy begun in 2013, which seek to promote the orderly and sustainable development of the sector, its standardisation and the construction of better housing.

Housing Policy

In February 2013 the government decreed an updated housing policy consisting of “a new model focused on promoting the orderly and sustainable development of the sector to improve and standardise urban housing, as well as to build and improve rural housing.” These objectives are intended to be achieved through four strategic axes, which are:

• Development: Increasing competitiveness and promoting the permanence of existing businesses, thus avoiding the expulsion of the original population.

• Environment: Raising awareness of the importance of rationalisation in the use of natural resources and responsible waste management.

• Environment: Promoting the establishment of the existing population and new neighbours, facilitating relationships and avoiding conflicts, based on the improvement of public spaces.

• Community: Strengthening relationships through solidarity and equity by facilitating the integration and empowerment of the citizenry in activities that promote the achievement of common objectives. This policy is intended to contain the growth of what is known as the “spot of the cities” – space where housing, buildings and other urban infrastructure are located – which has been disordered in recent years. To this end, vertical housing growth will be encouraged to maximise the use of existing infrastructure for public services, roads and public transport networks.

Capital Law

In December 2016 the Legislative Assembly of the Federal District approved the New Housing Law for Mexico City. The law opens opportunities to guarantee juridical and normative certainty, promoting access to decent housing for the city’s population, encouraging coordination between different entities to promote the development of housing that satisfies the demands of the city and encouraging good planning and development of the same. The main aspects of this law are outlined below:

• Reduction of the cost of land derived from the generation of a territorial reserve. This will allow for an increase in the supply of developments in the city and will help to reduce land speculation.

• The ordering of human settlements and the urbanisation of neighbouring areas, creating novel market niches in new areas of the city.

• The clear demarcation and designation of the different competencies of the authorities involved.

• This law reflects the vision of various actors such as academics, specialists, housing organisations, neighbours, authorities and private initiatives. A housing council will be formed to serve as an advisory body and to follow up on the use of public resources.

• It seeks to guarantee the right to decent and adequate housing for those who live in Mexico City and who, because of their socioeconomic circumstances, cannot provide this for themselves, strengthening social housing to the segment of the population with an income between 0 and 5 times the minimum wage.

• The law encourages the acquisition of housing for the thousands of families who have access to loans from the Federal Institute for Worker’s Housing or the Federal Housing Institute of Security and Social Services, or another type of credit.

• It includes the constitution of a “floor exchange” for social housing that has been restored by the city.

• It provides housing that is accessible for people with disabilities, senior citizens and the population at large via an accessible and affordable housing programme.