Housing in Chile (1960s - Present

HOUSING IN CHILE (1960s- PRESENT)

By the beginning of the 60s there were at least twenty-eight institutions dependent on eight ministries

involved in housing and urbanisation. To address this situation, the Ministry of Housing and Urban Development (MINVU) was created, which together with the Housing Corporation (CORVI) and the Housing Services Corporation (CORHABIT), made up the Urban Improvement Corporation (CORMU). A

company Autonomous State, one of whose main functions was to improve and renovate the deteriorated

areas of cities, through rehabilitation and urban development programs.

Throughout the history of its public housing programs, the Chilean government has fought against the

housing deficit and provided support for low income families. Responding to a more socially driven

political agenda, the main measure taken by the government in the 1960s was the establishment of the Ministry of Housing and Urbanism (República de Chile, 1956). The government founded a Ministry for Housing and Urbanism (MINVU) to set policy and manage public funds. It promoted a cultural of saving in low-income households through the Popular Savings Program (PAP), and the establishment of saving and Loans Associations (S&L). Public funds were allocated to the Ministry of Housing and Urbanism to

build low-cost houses that were sold to low-income households.

Within Eduardo Frei Montalva’s term in charge from 1965-70, there was real intent to reduce the housing

deficit, which was mirrored from a global perspective, in countries of the global north like the US and UK. In Chile “a global six-year plan was designed to construct 360,000 dwellings, of which 60% would be destined for the lower-income sectors” (Kusnetzoff 1987: 159). Housing programs would incorporate

schools, health centres, sports fields, among other spaces. It was considered that the solution of the

housing problem required the participation of the beneficiary families.

The Allende administration aimed to “add an ambitious emergency plan for the year 1971, with the goal of beginning the construction of 80,000 dwellings that year.” (Kusnetzoff, J. 1987: 161). A series of other policies were initiated to favour the popular sector. Kusnetzoff, J. (1987) summarises Allendes term as one that “showed a greater capacity to deal with the accumulated lack of housing, with the institutional

structure and existing resources.”

During Pinochet in 1976, they “dismantled the structure by which the Chilean state over a continuous

process of more than 50 years were able to make. The great advancements in key areas of the economy

and in social development, have repressed implacably the political organisations and social sectors identified previously with the benefits of state action” (Kusnetzoff, J. 1987: 164).

MINVU was restructured, privatised and regionalised, territorially deconcentrating through a

metropolitan ministerial secretariat. Demonstrating an immediate shift away from the previous public spending incentives of Allende et al. Still, MINVU stated that “urban policy is the first place ought to

maintain a strict control over urban expansion, as much to utilise to its maximum capacity the existing

resources of the urban infrastructure as to avoid an increased occupation of agricultural lands. This

measure will succeed, principally, through the freezing of the urban radius, allowing for expansion only in very qualified cases.” (Granifo, C. 1976: 86).

Regional ministerial secretariats (SEREMI) and Urban Development Departments were created in all

regions of the country. The four Corporations merged: CORHABIT, CORMU, CORVI and COU, establishing a Regional Housing and Urbanisation Service (SERVIU), in the Metropolitan Area and throughout Chile.

A new general law on urban planning and construction is promulgated, granting the state a level of

centrality and control, typical of a neoliberal mindset. A major feature amongst Pinochet’s reign with

regards to housing, was characterised by the dramatic increase in poverty, providing the nation with its worse period of homelessness. In reference to (see fig.4), between 1952 and 1970 the housing deficit

increased by 20%.

Fig. 4 Table 1 . Estimated housing deficit in Chile, 1952 - 2009. Table 2. The housing deficit in Chile, 2006 - 2009

Contradictory to the ministries statement three years prior, they exacerbated housing tension privatising “control over urban land was loosened and the urban limits of Santiago were abolished by Decree No.

420 of October 1979. Some 64,000 hectares were added to the existing 36,000 occupied by the metropolitan area of the capital, almost tripling instantly the potential land market” (Kusnetzoff, J. 1987: 166). In 1979 the government issued the Politica Nacional de Desarrollo Urbano. It read “at

the level of the urban system, planning will be aimed at making the process of urban development

compatible with the global model of the country’s development, creating the conditions most convenient for facilitating the operation of the urban land market” (MINVU. 1979: 7).

MINVU made important changes in its programs in 1981, by extending the regulation of the newly

created Variable Housing Subsidy. This measure gave rise to the Basic Housing Program, contemplating

a system of variable subsidies and considering basic housing as the first step for social housing. Marking

a state awareness to a demand, yet contrary to neoliberal beliefs. The houses were assigned to people

who lived in marginal populations and camps that were identified in the MINVU maps and municipalities.

The SERVIU opened a new permanent application system that it incorporated savings and the number

of family charges. Basic homes that were allocated through this system, could qualify for a subsidy

equivalent to 75% of the value of the home. In 1985 the number of registered applicants reaches 170

thousand families, illustrating a necessity for provision and a reflection of the countries housing crisis.

SERVIU’s mission was to contribute in improving the quality of life of the inhabitants in its assigned region,

through housing programs, pavements, community facilities, subsidies, urban parks and urban roads.

It’s principle aim was to assist the lower income sectors in overcoming housing shortages. It is stated

there have been numerous mechanisms implemented in the permanent search for greater effectiveness

and efficiency to meet the housing demand of the population, particularly in the most vulnerable sectors. İlgü Özler, Ş. (2012: 60), suggests, that despite their good intentions to serve the poorest part of the

communities, they indivertibly contributed to further income segregation. Those who benefitted were of

moderate income and were often given social housing on the poorly networked peripheries of cities, due

to the lack of housing within cities, available on the secondary market. Putting the beneficiaries under the unpredicted stress in maintaining the funds for program (about US $420) and neglecting those under

Then towards the final years of Pinochet, the housing deficit total increased to a further 35%. However,

despite the recent Concertacion government’s efforts to reduce poverty in the development of welfare policies, lack of housing was a constant issue throughout their era. “The committees operated as

atomistic units rather than as a cohesive housing rights movement that would push for a shift away from a neoliberal housing system to a social housing system” (İlgü Özler, Ş. 2012: 59). At the fall of Pinochet’s

reign, a plebiscite was held in 1988. Patricio Aylwin was elected, and democracy had finally been restored

to Chile. From the preservation of Pinochet’s neoliberal policies, the Concertacion government adopted the ideology of housing being a commodity rather than a right. “Yet these neoliberal housing programs

stratify residents into categories of poverty in which the poorest residents compete against one another to access subsidies and find housing” (İlgü Özler, Ş. 2012: 53). It was a system that not only neglected

equality, but one of equity too. It couldn’t provide the simple necessities of the poorest and homeless,

in addition it was often criticised by those who could access its provision, due to the extremely long waiting times and the poorly considered location of the housing. “The poor end up in low-quality housing in economically segregated neighbourhoods far from jobs and services” (İlgü Özler, Ş., 2012: 67). The

competition created, encouraged bitterness between communities, eliminating the threat of solidarity

where efforts could’ve been channelled into harmonising the collective, and more politically considered

forms could generate a protest. Crippling the notion that the community can act cooperatively to seek a

solution. It was the aim of the government to ensure that citizens would behave in a unconfrontational

manner against the state, within their technocratic and bureaucratic processes. Pinochet’s dictatorship

epitomised a neoliberal control of the masses, inciting conflict amongst his population.

Under Michelle Bachelet (2006-2010), in the last Concertacion coalition, the population was promised

a developed housing program, encouraging a more bottom up participation amongst citizens, as the

case of Elemental’s Quinta Monroy. In reality these housing programs still harboured the same market

principles as before, yielding only a limited laissez-faire form of public participation. Concertacion

created an unchallenged model of social protection within the focussed private housing sector, thus

Chile’s housing and income inequality persisted.

Paley (2001) mentions that they prioritised “governability, stability and consensus at an elite level than

promoting social organisation.” It was their commitment to neoliberalism that the instigated social