Appropriating rent from greenfield affordable housing: developer practices in Johannesburg

Abstract

‘Affordable housing’ for Johannesburg’s growing middle class is a developmentalist imperative and potentially lucrative market. However, few greenfield developers have found this market profitable. Fundamental to those who have, is control over land and its development. This paper puts heterodox urban land rent theory to work vis-à-vis the logics and practices of these developers. I illustrate how greenfield affordable housing developers work to (re)produce differential and monopoly rents in this context. Differential rents rely on investing in cheap land produced through the city’s racialised geography, and controlling land’s development through vertical integration, dynamic negotiations with local government and development finance institutions, and steering money and people into developments. Monopoly rents rely on the power of developers to act together as a class to secure land, give the appearance of competition and lobby the state in their interests. This power is built through racialised control over land and long personal connections. It is also consolidated by the state’s own land development bureaucracy and preference for ‘mega’ developments and recognisable developers. Together, these developer strategies to accrue differential and monopoly rents demonstrate their active role in the everyday making of land and housing markets. They also demand extensions of heterodox urban land rent theory: first, a more articulated understanding of how class monopoly power over land is built through race, and second, a more contingent analysis of capital’s relations to other actors and institutions, especially the state.

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