rise to segregation by income. In contrast to the literature, we explore the sequential arrival

of poor and rich individuals to neighborhoods exploited by oligopolistic land-developers. These

developers try to maximize a discounted flow of lot prices during neighborhood formation, taking

advantage of the local externalities generated by the rich and the poor. Under a speedy arrival

of new potential inhabitants and / or low discount rates, competing developers are more likely to

concentrate rich people in the same neighborhood. This happens because the benefits from early

agglomeration are outweighed by a more profitable matching of rich neighbors within nearby

lots.