This paper highlights the economic and policy significance of informal institutional arrangements (ignored in past research) governing housing transactions citywide that permeate both formal and informal sectors, blurring the conventional formal/informal distinction. It documents the convergence in formal and informal housing markets in Turkey by focusing on the "build and sell system," an institutional arrangement between land owners and small scale contractors/ entrepreneurs governing multistory housing construction. Other informalization trends in formal subdivisions such as noncompliance with building codes (induced by amnesty laws), and formalization trends in gecekondu settlements such as commercialization and densification (accelerated by municipal regularization programs and land pressures) depict the convergence.
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