Transformation of the Urban Periphery and New Forms of Production of Inequality in Brazilian Cities: A View on the Recent Changes in the Dynamics of the Real Estate Market

This article’s objective is to discuss recent transformations in the periphery of Brazil’s largest cities, considering the expansion of real estate, strongly supported by the government housing programme “Minha Casa Minha Vida” (MCMV). Using historical and theoretical analyses, we will demonstrate the shifting of the primacy of the contradiction between capital and labour, dominated by industrial capital, to the primacy of an urban contradiction, dominated by financial capital.

In that context, we will recollect and discuss the literary production which has problematized the formation of the periphery in the 1970’s, interpreted as the process that decreases the cost of labour power reproduction and characterized by self-built housing, in a scenario of strong industrialization and high immigration rates. In this sense, the periphery was consolidated as an important instrument to amplify industry gains and expressed through the intense inequalities in the Brazilian urbanization.

Considering the recent dynamics, we will investigate the changes in the peripheries, produced by the dissemination of large housing developments aimed at the lower income population. The role of the State, through a policy of access to financing and subsidies to achieve a target number of three million housing units, was determinant in the intense real estate appreciation in these territories. To better understand this dynamic, we also need to comprehend the process of financialization and capital centralization in real estate, marked by the dominance of large and expanding real estate developers.

Our hypothesis is that the appropriation of the periphery has consolidated into an essential strategy in the amplification of the gains and expansion of real estate. As a consequence of this strategy of appreciation, the access to property in the periphery tends to become a temporary condition and seems to be imposing new inequalities, which we will discuss using different case studies from Brazilian cities.