Land Policy: Power, Value Capture and Spatial Justice

Land policy is the set of public decisions about who may use, build on and profit from urban land: zoning, taxation, expropriation, land value capture and the provision of land for social housing. It is the most decisive urban policy and the least visible, because it fixes in advance who gains from a city's growth and who is left out. The geographer Edward Soja, of the University of California, Los Angeles, placed it at the heart of his theory of spatial justice: the way land is distributed produces and reproduces inequality, and can therefore correct it.

Edward Soja, Postmetropolis and spatial justice

In Postmetropolis (2000) Soja describes the postmodern city-region, with Los Angeles as his case, where the production of space answers to developers, funds and local elites who capture the land value generated by public investment. In Seeking Spatial Justice (2010) he states the key idea: geography is not a neutral backdrop but an active mechanism of injustice, and struggles over space, such as that of the Los Angeles Bus Riders Union, which in 1996 won the diversion of funds from suburban rail to buses serving poor neighbourhoods, are struggles for justice. Land policy is the ground on which that dispute is fought every day.

Speculation, land rent and inequality

Land has a property that sets it apart from any other good: its value is created not by the owner but by the city around it. A metro line, a school or a rezoning can multiply the price of a plot without its owner lifting a finger. If that gain stays in private hands, land policy works as a transfer of public wealth to individuals and feeds speculation: buying and holding land while waiting for the city to raise its value. The outcome is unaffordable housing, whole neighbourhoods waiting to be developed and informal peripheries where formal land never arrives.

Tools for recovering land value

Latin America has developed the most advanced instruments to correct that dynamic. Colombia's Law 388 of 1997 allows municipalities to charge up to half of the value increase generated by planning decisions. São Paulo auctions certificates of additional building potential, the CEPACs, to finance infrastructure in its urban operations. Bogotá and Medellín share costs and benefits among landowners through partial plans. In Europe, Spanish planning law obliges developers to cede land for facilities and protected housing, and the Netherlands holds much of its urban land in public ownership under ground leases.

Other tools act on tenure. Community land trusts, born in the United States and extended to Brussels and Puerto Rico, separate ownership of the land from ownership of the home to keep it permanently affordable. Public land banks, taxes on vacant plots and regulation of tourist use complete the toolbox. None of them works without up-to-date cadastres, public information on who owns what and technical capacity in local government, which is where many cities fall short.

Land policy for an equitable city

Soja insisted that spatial justice is not achieved merely by redistributing income but by changing how space is produced. An equitable land policy recognises that urban value is collective, returns to the community the share the community generates, protects low-income neighbourhoods from the rising values that push them out and guarantees land for affordable housing across the whole city, not only at its edges. Whoever controls the land controls the city, and deciding that control is the central political task of urbanism.