Urban reconversion of Mexico City due to the economic crisis of COVID 19 or due to a process of financialization?

Abstract

The COVID 19 pandemic forced the closure of sources of work and evidenced the precarious situation of the economic income of Mexican families, causing the loss of rental or mortgage housing and exposing, as a secondary effect, the public policies that regulated the urban growth of Mexico City (CDMX). Even though the central government of the city published in 2022 the "Agreement for the conversion of offices to housing in Mexico City", there is still the displacement of 100 thousand inhabitants per year who are unable to obtain a habitable space (Cruz, 2024). The reconversion of land uses, housing production, and regulatory schemes that contribute to legal construction in the city have only facilitated the construction of 1.25% of the 300 thousand units that are required per year (Díaz, 2022) and that cannot be acquired by the 30% of the population living in extreme poverty. With an incessant construction process and with the highest trade index (supply and demand) in the country, the cost of land and construction is becoming more expensive; so the large real estate developers are not considering the vulnerable social classes as their commercial objective and see a means of investment of financial assets that does not solve the habitable problems of the city and that derives, inevitably, in a process of financialization. The introduction of national and foreign private investments under the neoliberal competitiveness scheme benefits the intensification of the activity of the real estate market, both in housing and in the peripheral areas that urbanize them, causing social gentrification that ultimately prevents the population from recovering its living space.