Playing With Politics

A Blog on Law, Politics, Planning, Development, and Other Vices

Missing the Forest Because of the Trees: Gentrification

Posted by Roobs on August 6, 2011

Gentrification is sometimes thought of as a third-rail topic – touch it you die.  Gentrification has become so controversial that the mere mention of it can elicit strong and passionate debate. Proponents of gentrification say it improves neighborhoods: by improving the physical environment of a neighborhood, gentrification also improves the quality of life for residents, new and old.  Critics, however, see gentrification as a tool by wealthy developers and urban professionals to displace an undesirable bloc of the population – usually minorities.  But in all the kerfuffle of debate, many are unwilling to look at the real causes of the problems they see.  Studies are showing that gentrification doesn’t actually do all that critics have long accused it of.  Additionally, critics of gentrification often are calling for it, just leaving out the name.

What is Gentrification?

Gentrification is a concept in urban America where new residents, usually middle and upper-class (hence “Gentry”), buy property in low-income neighborhoods.  These new residents will fix up old, dilapidated properties, thus improving their property values.  Property values increase because the property, in very simple terms, looks a lot nicer – the prettier the house, the higher the property value.  As a result of higher costs original residents may be displaced.

How Gentrification Displaces Original Residents

Gentrification is a process that is rather neutral in of itself.  The fact that new people have moved in a low income neighborhood isn’t necessarily what displaced the original residents.  It’s the increase in cost of living that does.

What is often difficult for some to understand is that property values do not occur in a vacuum.  Your neighbor’s property value has an influence on your property value as well.  If you live in a run down or even moderately well-kept home and your neighbor fixes up his or her home to be much nicer, your property, without doing anything, experiences an increase in property value for simply being next door.  This is controversial in lower income neighborhoods because as a new wealthier resident increases the property value of their new home, they are indirectly increasing the property value of their neighbor’s home.  While this may seem like a win-win situation, it actually is a problem for low-income families.  As their property value rises, so do their taxes.  As taxes rise, so does the cost of living in this property (rent, mortgage, property taxes, etc.)

This is even harder on renters who do not have control of their property.  As property taxes and other ownership fees increase, the property owner may be compelled to sell the property to another party who may or may not wish to keep the property, or who makes additions to the property that further cause an increase in rent.

Further, as more wealthier residents move in, so do businesses that tailor to the wealthier residents causing prices for goods to rise as well.  This can be seen as a negative by anti-gentrification advocates who see this as focusing on non-native community members.  As this process replicates across the neighborhood as more and more wealthy individuals buy property, it can lead to the overall displacement of the original low-income residents because they can no longer afford to live there (i.e., pay the now higher rent or buy the now higher cost food).  It is this effect of gentrification that critics refer to when they bemoan gentrification.  But when they come out and say “gentrification is bad”, their focus is all wrong.

Missing the Forrest Because of the Trees

Critics would have you believe that gentrification is wrong under any circumstances.  But this isn’t true.  Whether you think it’s good or bad, most are willing to concede that gentrification does improve the physical environment of a neighborhood.  And critics are fine with that part.  But they really are suggesting they want out of gentrification is all the benefits without having to allow in new residents.

Many want to see low-income neighborhoods turned around and thriving.  I mean, who doesn’t   We look at wealthier neighborhoods and argue why the beauty and success of these areas cannot be shared with those on the other side of the proverbial tracks.  But as I explained in the previous section, to attempt to improve the physical environment of a neighborhood (make it look nicer) is almost, by definition, to bring about the very effects of gentrification that they would like to avoid.  The real problem of the displacement of the urban poor is not gentrification itself, but the low income brought in by the families and the societal problems that contribute.  To solve this problem, critics of gentrification should be focusing on economic development for low-income families, such as education and employment retention and development.  However, critics of gentrification don’t look at this.  The goal of critics is to either halt all development in these neighborhoods or ask our market system to allow them to improve their properties but maintain property values and fees at their low rate, which is entirely unrealistic.

For example, let’s look at a neighborhood in the City of Oakland in the San Francisco Bay Area.  The neighborhood of West Oakland has long been a traditionally African American neighborhood.  For many years, it has also been a low-income neighborhood.  During the housing boom of the early 2000’s, developers were converting old factories and warehouses into trendy urban lofts as well as constructing entirely new condo projects.  Many started to worry about the potential for gentrification – original residents being displaced by incoming young professionals.  So how would critics have solved this?  Here’s a thought exercise:

Critics will say they wanted to see West Oakland improve but to maintain its “character”.  Of course, the character of a neighborhood is defined by its residents.  So to maintain the character is to maintain the residents.  So let’s keep all the residents here.

After working it that all the original residents can stay, they now want to improve the neighborhood, so let’s keep developing.  We turn those abandoned warehouses into lofts, put a new coffee shop and don’t forget the supermarket (which West Oakland desperately needs – I’m looking at you, Safeway).  We also work to improve the streetscape: install trees, landscaped medians and new street lighting.  Now we have a beautiful neighborhood with all of its original residents.  It is a win, if only briefly.

Because of the way our property and market system work, West Oakland will now be considered a desirable neighborhood.  Thus, properties will become more valuable and the cost of living will increase.  New residents will still have maintained their previous levels of income because we never addressed their income as a factor in how we improve the neighborhood.  But now that their property is worth more, their property taxes and fees also increase.  If they rent their home, then the landlord will likely raise the rent to compensate for the increase in property taxes he or she is now paying, or simply sell the building.  So without any interference from “evil” developers and all the good intentions of gentrification critics, original residents can no longer afford to live in their new and nice homes.  Let’s also keep in mind that it is not always developers new residents buy from.  It can often be the original resident who decides to sell his or her house at the increased price so they can move to another location by choice.

Ultimately, it wasn’t the fact that new hipsters or yuppies moved into the neighborhood, regardless of their income.  People have the right to move wherever they want to, after all.  It was the way in which our system of market and property values work that put the original residents out.  You cannot decry all that is gentrification while still demanding that neighborhoods need to be physically improved.  And this is what critics are ignoring.

In Conclusion

Now, don’t get me wrong.  I am not trying to say that all aspects of gentrification are great and we should encourage it everywhere. When proponents of gentrification speak, they must understand that their actions do have consequences.  There is nothing amusing or good about kicking people out of their homes.  There are also still many questions about gentrification that we can still ask.  But when critics use gentrification as fodder for fear, they are being dishonest.  When they use gentrification to stop urban development in areas in much need of investment, they are hurting the very people they claim to protect.  The only alternative to what they seek is to do nothing at all, which helps no one.

Gentrification, in of itself, is not the problem.  It is the poor economy that doesn’t provide jobs to all workers that is the problem.  It is the income disparity between the haves and haves not that is the problem.  As you read in the example above, because the residents of West Oakland maintained their previous levels of income, they were unable to keep up with the rising costs of living in an improving neighborhood.  We need to focus on bringing in new economic opportunities that are open to original and low-income residents that will allow them to stay.  No amount of opposition to gentrification will solve the underlying problems of low income residents losing their homes.  It only simply ignores it.  And that is the true wrong.

Roobs is a masters student at UCLA in the Department of Urban & Regional Planning with concentrations in Transportation Planning & Policy and Urban Design & Development. He has a BA in Legal Studies and Sociology from UC Berkeley. Roobs is a former Waterfront Commissioner for the City of Berkeley and former paralegal for a law firm specializing in real estate development.


One Response to “Missing the Forest Because of the Trees: Gentrification”

  1. Do you have a Facebook page or Twitter? Would love to follow you there, I’m on my iPhone and love reading your stuff!

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