The concept of progressive development--the construction of houses in stages--represents a fundamental principle of the sites and services approach, the most popular policy put forth to deal with the present Third World housing shortage. Through an analysis of the development process occurring in a completed sites and services project in Zihuatanejo, Mexico, this thesis investigates such a concept as a physical phenomenon. The physical evolution of the houses towards consolidation is analyzed with regard to two of the factors that shape the development process: the habitable area, and the construction quality, from which the people's physical priorities for housing are inferred. The findings of this study are compared with those of earlier studies, and the broader implications of such findings are briefly outlined. This study suggests that space takes precedent over permanence as a priority in the course of the early development of the house.