Residential Land Price Changes in Mexican Cities and the Affordability of Land for Low-income Groups

This research demonstrates that the price of residential land in Mexico declined significantly in real terms during the 1980s. Land prices appear to follow a cyclical trend which tracks Mexico's macro-economic performance. Data derived from advertised plot prices in newspapers, and from a large sample of household interviews conducted in low-income settlements in three intermediate-sized Mexican cities, suggest that, for the poor, real wage levels are the key determinant of changing affordability. The erosion of real wages has led to some decline in affordability, but this has largely been offset by multiple-earning strategies within households through which purchasing power may be maintained.