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Geographies of Housing Finance: The Mortgage Market in Milan, Italy

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  • MANUEL B. AALBERS

Abstract

The geography of financial exclusion has mainly focused on exclusion from retail banking. Alternatively, and following the work of David Harvey, this paper presents a geography of access to and exclusion from home mortgage finance. The case of Milan shows that capital switching to the built environment is partly a sign of economic crisis and partly a sign of the intrinsic opportunities that the built environment provides. A major factor in both is the deregulation of the mortgage market that has enabled the loosening of historically stringent lending criteria, leading to a tremendous growth of the mortgage market, while leaving the co-evolution of family and home ownership intact. In addition, capital switches within sectors of the economy and between places. In Milan, once "unattractive" but currently gentrified nineteenth-century districts underwent cycles of devalorisation and revalorisation. Even though access to mortgages has increased throughout Milan, geographical disparities in mortgage lending persist: at present, yellowlining (differential access, based on less favourable terms) is common in parts of the Milanese periphery. The creation of boundaries makes the realisation of class-monopoly rent possible; while the subsequent redrawing of these boundaries creates new submarkets in which surplus value can be extracted. Based on the Milan case, one cannot explain the timing and geography of formation and reformation of submarkets in other cities, but it helps us to see how Harvey's abstract ideas of class-monopoly rent, submarket creation, and capital switching take place in the real world. Copyright 2007 Blackwell Publishing.

Suggested Citation

  • Manuel B. Aalbers, 2007. "Geographies of Housing Finance: The Mortgage Market in Milan, Italy," Growth and Change, Wiley Blackwell, vol. 38(2), pages 174-199.
  • Handle: RePEc:bla:growch:v:38:y:2007:i:2:p:174-199
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    File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1468-2257.2007.00363.x
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    1. repec:gam:jsusta:v:11:y:2019:i:2:p:375-:d:197276 is not listed on IDEAS
    2. Manuel B. Aalbers, 2009. "The Globalization and Europeanization of Mortgage Markets," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 33(2), pages 389-410, June.
    3. Kevin Fox Gotham, 2009. "Creating Liquidity out of Spatial Fixity: The Secondary Circuit of Capital and the Subprime Mortgage Crisis," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 33(2), pages 355-371, June.
    4. repec:eme:ijhmap:ijhma-05-2016-0037 is not listed on IDEAS
    5. Bulbarelli, Miriam, 2016. "The housing finance system in Italy and Spain: Why did a housing bubble develop in Spain - and not in Italy?," PIPE - Papers on International Political Economy 26/2016, Free University Berlin, Center for International Political Economy.
    6. repec:bla:ijurrs:v:41:y:2017:i:5:p:786-803 is not listed on IDEAS

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