More Notes on Gentrification

by Latoya Peterson

I came across an interesting piece on Boing Boing where the author is trying to reconcile his gentrified reality.

In “Your Money or Your Life: A Lesson on the Front Stoop,” Douglas Rushkoff recounts being mugged in his neighborhood. The experience jarred him for a variety of reasons:

In the meantime, I posted a note about my strange and frightening experience to the Park Slope Parents list–a rather crunchy Internet community of moms, food co-op members, and other leftie types dedicated to the health and well- being of their families and their decidedly progressive, gentrifying neighborhood. It seemed the responsible thing to do, and I suppose I also expected some expression of sympathy and support.

Amazingly, the very first two emails I received were from people angry that I had posted the name of the street on which the crime had occurred. Didn’t I realize that this publicity could adversely affect all of our property values? The “sellers’ market” was already difficult enough! With a famous actor reportedly leaving the area for Manhattan, does Brooklyn’s real estate market need more bad press? And this was before the real estate crash.

I was stunned. Had it really come to this? Did people care more about the market value of their neighborhood than what was actually taking place within it? Besides, it didn’t even make good business sense to bury the issue. In the long run, an open and honest conversation about crime and how to prevent it should make the neighborhood safer. Property values would go up in the end, not down. So these homeowners were more concerned about the immediate liquidity of their town houses than their long-term asset value — not to mention the actual experience of living in them. And these were among the wealthiest people in New York, who shouldn’t have to be worrying about such things. What had happened to make them behave this way?

Eventually, Rushkoff’s pondering leads him to start questioning the nature of displacement in neighborhoods:

Why, I wondered aloud on my blog, was I struggling to make $4,500-per-month rent on a two- bedroom, fourth- floor walk-up in this supposedly “hip” section of Brooklyn, when I could just as easily get mugged somewhere else for a lot less per month? Was my willingness to participate in this runaway market part of the problem?

The detectives who took my report drove the point home. One of them drew a circle on a map of Brooklyn. “Inside this circle is where the rich white people from Manhattan are moving. That’s the target area. Hunting ground. Think about it from your mugger’s point of view: quiet, tree-lined streets of row houses, each worth a million or two, and inhabited by the rich people who displaced your family. Now, you live in or around the projects just outside the circle. Where would you go to mug someone?”

Back on the World Wide Web, a friend of mine–another Park Slope writer–made an open appeal for my family to stay in Brooklyn. He saw “the Slope” as a mixed-use neighborhood now reaching the “peak of livability” that the legendary urban anthropologist Jane Jacobs idealized. He explained how all great neighborhoods go through the same basic process: Some artists move into the only area they can afford–a poor area with nothing to speak of. Eventually, there are enough of them to open a gallery. People start coming to the gallery in the evenings, creating demand for a coffeehouse nearby, and so on. Slowly but surely, an artsy store or two and a clique of hipsters “pioneer” the neighborhood until there’s significant sidewalk activity late into the night, making it safer for successive waves of incoming businesses and residents.

Of course, after the city’s newspaper “discovers” the new trendy neighborhood, the artists are joined and eventually replaced by increasingly wealthy but decidedly less hip young professionals, lawyers, and businesspeople–but hopefully not so many that the district completely loses its “flavor.” Investment increases, the district grows bigger, and everyone is happier and wealthier.

Still, what happens to the people who lived there from the beginning–the ones whom the police detective was talking about? The “natives”? This process of gentrification does not occur ex nihilo.

While I liked his reasoning on his own choices and culpability later on in the piece, I kept getting stuck where he describes the process. Is gentrification really that simple?

Then I realized what was bothering me: the presentation of gentrification as an organic process, starting with young starving artists (who then must be compelled to open a gallery, what else do artists do?) and ending with a more moneyed populace coming to chase the newly cool neighborhood. Then, the cycle is supposed to repeat.

But where is the role of the state in this discussion?

We’ve covered gentrification quite a bit on Racialicious, but we haven’t really spent time discussing the necessary power dynamics involved to completely displace a community.

Back when I wrote The Gentrification Shuffle, I didn’t think too much about the role of the state in encouraging gentrification. However, over the years, I’ve been paying more attention to exactly how this happens. My neighborhood was specifically chosen to be “revitalized” and was actually a part of a six year long state initiative to get young families and couples to populate this area. The initiative was fairly successful. There is a lot more income flowing to my part of the city, far more than before, and they continue to make small neighborhood improvements. The demographics have started to shift, but not quickly – most of the people in rent controlled housing stayed put, and while the new additions to the neighborhood require more money to enjoy, most of the mom and pop shops and restaurants are still in business.

Unfortunately, this is not the case in many areas close by. A lot of small businesses are closing because of hits to their business or loss of municipal benefits that allowed them to keep their doors open. In addition, some areas are specifically being remade to target a certain type of new resident, one with mounds of disposable income. Shops that do not fit the new vision of the neighborhood are encouraged to close either with buy outs or leveraged pressure by the city.

Prior to the new stadium, Southeast DC* was one of the places where the government used eminent* domain to take privately owned land and change it into what they wanted – in this case, an area known for slums and city owned senior citizen housing was torn down to make way for a new mall. When the mall failed to attract the type of stores they hoped, the city closed them down. Now, a new plan – valued at a $2 billion dollar current investment with $10 billion more proposed – has been launched to great fanfare, basing the new Waterfront around Nationals Ballpark and the new headquarters for the Department of Transportation.

This map is provided by JDLand.com, one resident’s documentation of the changes in the SE area. On her site the map above is interactive, and hovering over the areas provides a brief description of what is to come.

If you look at the residential area on the map, you notice that of the four major projects listed (Capitol Quarter, Foundry Lofts/Yards, Velocity Condos, 909 New Jersey Avenue) only one indicates subsidized units. (The Capper Mixed Income Building is proposed, but does not have a timeline for development.) The other projects indicate that there will be market rate housing available, defined by the National Low Income Housing Coalition (NLIHC) to mean:

In District of Columbia, the Fair Market Rent (FMR) for a two-bedroom apartment is $1,288. In order to afford this level of rent and utilities, without paying more than 30% of income on housing, a household must earn $4,293 monthly or $51,520 annually. Assuming a 40-hour work week, 52 weeks per year, this level of income translates into a Housing Wage of $24.77.

In District of Columbia, a minimum wage worker earns an hourly wage of $7.55. In order to afford the FMR for a two-bedroom apartment, a minimum wage earner must work 131 hours per week, 52 weeks per year. Or, a household must include 3.3 minimum wage earner(s) working 40 hours per week year-round in order to make the two bedroom FMR affordable.

In District of Columbia, the estimated mean (average) wage for a renter is $25.41 an hour. In order to afford the FMR for a two-bedroom apartment at this wage, a renter must work 39 hours per week, 52 weeks per year. Or, working 40 hours per week year-round, a household must include 1.0 worker(s) earning the mean renter wage in order to make the two-bedroom FMR affordable.

Monthly Supplemental Security Income (SSI) payments for an individual are $674 in District of Columbia. If SSI represents an individual’s sole source of income, $202 in monthly rent is affordable, while the FMR for a one-bedroom is $1,131.

A unit is considered affordable if it costs no more than 30% of the renter’s income.

The picture isn’t so rosy for those of us making above minimum wage either. In the introduction to their 2008 report, the NLIHC describes the other gaps in the space between paid wages and the rental wage:

While there were roughly 1.7 million minimum wage earners in the U.S. before the rate was increased in 2007, most Americans earn more than the minimum wage for every hour they work. The median hourly wage in this country is just under $16.00.

This analysis estimates that nationwide the average renter earns around $13.94 an hour. As Figure 1 illustrates, a full-time job at the national mean renter wage falls short of providing enough income to afford even a one-bedroom home at the average FMR. Only a household that averages 50 hours per week year-round – with no unpaid time off – can afford the national average FMR for a two-bedroom unit at the national mean renter wage.

In a fascinating report called “A Place to Call Home,” written by the Foster and Adoptive Parent Advocacy Center (FAPAC) as a policy paper for the Moriah Fund, the link between DC’s affordable housing crisis and child welfare is explored. While the majority of the 2004 paper focuses on the destabilization of families and the vulnerabilities of foster children in this environment, the study reveals some facts about the housing crisis that cannot be ignored:

For renters with annual incomes below $10,000, the Washington region has a shortfall of almost 40,000 affordable housing units. The supply of affordable housing meets the demands of less than 50% of the area’s neediest renters. (Housing in the Nation’s Capital, Fannie Mae Foundation, 2003) A minimum wage employee earns $6.15/hour, and can afford no more than $320/month in rent.

Ironically, the average monthly cost of a reserved parking space in downtown Washington, DC is $280. (Affordable Housing: Designing An American Asset, National Building Museum exhibit brochure, 2004)

Incomes for people living in the District have not kept pace with housing prices; from January 1999 to March 2003, the sale price of homes rose four times faster than income, and the price of rentals rose three times faster. (PolicyLink Report, Fall 2003) In addition to the increase in the cost of existing housing, there has been a loss of affordable housing units due to a variety of factors, including conversion of private market affordable rental housing to high-end rentals or condos in emerging markets, expiration of long-term government contracts for privately owned subsidized developments (Section 8 contracts operated by the DC Housing Authority), a decrease in stock of rental units subsidized by HUD, and the production of HOPE VI housing, which replaces fewer units than the number of public housing units demolished. (Housing in the Nation’s Capital)

For many people, it is no longer possible to live in the District of Columbia without housing assistance. The resources of the child welfare system are strained as staff and advocates try to help families secure what minimal affordable housing that is available. Although financial assistance is available for housing through a number of federal and local programs, these programs fall far short of meeting the need. There are approximately 35,000 people on the waiting list for Housing Choice Vouchers, a program funded through the federal Family Unification Project (formerly Section 8).

This program is currently 100% full.

Of the 930 confirmed housing units in Southeast, 91 are flagged to be “workforce rate units” and an additional 111 are to be subsidized and/or section 8 units.

While this ratio may change once the Capper project is approved**, the stark realities of affordable housing and challenges in city planning will not be resolved any time soon.

So, I’ll open up the floor. Readers, what do you think is the role of the state in ensuring affordable housing for its residents?

* Corrected as per Blanc2 in the comments.
*As per JD in the comments,the area in question is Southeast. She also notes the Capper project has been approved.