informalizing the formal

For the past dozen years, Mexico has pushed homeownership for the poor. Instead of squatter communities, the government arranged for the state-run mortgage agency to provide loans to people buying into massive cookie-cutter neighborhoods built by favored construction companies. Today, two of the big-three homebuilders are near bankruptcy, and the third is headed that way. Shares of all three have dropped 60 percent since the beginning of 2013.

But this is not simply a business story about a government subsidized bubble. It's also a story of ingenuity in the face of adversity.

Aldo Ortiz, one of the 2 million Mexicans who took a chance on a mortgage and a dream of a suburban home--his in a community calle Parque del Cipres outside Mexico City--wound up quitting his job in an electronics company because of the impossibly long commute (3 hours a day, round trip) and opening Miscelaneo "el Cipres", a System D mini-mart, in his living room. There, he sells beer, water, tortillas, snacks, canned goods, detergent, etc.


The Wall Street Journal has the details.