integrated in the urban economy. The 2009 World Development Report on economic geography echoes the primacy of titling.<sup>4</sup> It identifies titling as the critical first step in building fluid land markets and defers regulatory reform to later stages of urbanization. Buckley and Kalarickal (2006), on the other hand, draw attention to the role of regulatory and other constraints in preventing the emergence of effective land and housing markets, even where titles are well established. While not denying the importance of titles, they give precedence to reforming regulatory frameworks.

The differences in the two perspectives are more about appropriate sequencing, but Buckley and Kalarickal’s views imply that titles are a necessary but insufficient condition for the development of more fluid housing markets. The experience in transition countries is instructive in this respect. The massive transfer of ownership rights to sitting tenants in the 1990s was not sufficient to unlock the value of housing assets. Ten years after the initial reforms, housing markets had begun to show some signs of recovery, and market transactions were growing; however, housing investment remained historically low, the stock had deteriorated, and homelessness had grown.<sup>5</sup> The transition countries had achieved a high degree of private ownership without any of the complementary institutional structures associated with real estate markets and transactions.

Regulatory factors can reduce the benefits of titles. The planning process and regulations that define what can be built, where, and to what standard mitigate property rights even in the most market-oriented housing systems. However, in developing countries where land use and building regulations are frequently thwarted, even legally acquired property might not qualify for title registration or credit. Changes in regulatory measures defining minimum lot sizes may informalize development of legally purchased property that does not meet standards, as in Brazil, where the law specifying minimal plot sizes prohibits the registration of property within nonconforming subdivisions. Property rights are compromised as a result, because title registration is the critical guarantee in most Latin American legal systems.<sup>6</sup> While titling is necessary for overall housing finance development, there is little evidence that titling programs in informal areas have substantially increased access to credit for their lowincome beneficiaries. Despite the implementation of a large titling program in Peru, access to credit reportedly increased 9–10 percent for households with newly titled properties and tended to be limited to public banks. This underscores that collateral security through titles is a necessary but insufficient condition for accessing finance. Lower income or informally employed borrowers must also demonstrate repayment capacity. Moreover, newly titled properties might not qualify for finance where plots are below formal minimum sizes or where the construction does not comply with building standards.

# **_The debate over tenure security and title regularization programs_**

Tenure security has long been a central tenet of upgrading programs to protect slum dwellers from eviction and to encourage greater investment. It was emphasized as a means of dealing with 4