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In the last two decades there has been a large and simultaneous expansion of delivery-based national housing programs in the global South. This paper draws on an investigation of living conditions in Ciudad del Bicentenario, a large-scale housing project on the outskirts of Cartagena. Based on a sample of seventy-five lengthy semistructured interviews with low-income residents and ten other stakeholders, we reached three paradoxical findings that reveal the high costs of free housing: the immediate improvement of overall quality of life but the impoverishment of economic prospects; the dual social condition of the residents who felt socially and economically isolated but also shared a widespread perception of being 'revueltos' or scrambled within the community of Ciudad del Bicentenario itself; and the growth of economic and physical informality in a project intended to counter the informal settlements in the inner city. These paradoxes reflect more than simple processes of impoverishment of living conditions: they demonstrate how this type of public policy systematically complexifies the daily life of relocated families. Sociologically, these findings reveal a new type of peri-urban poverty in the global South. We argue that the productive informalization of the formal housing projects constitutes a central, but previously understudied, aspect of what it means to develop equitable housing. [ABSTRACT FROM AUTHOR]