Housing Markets Vary—So Must Our Tactics

There is widespread understanding about the vast differences in life outcomes that statistically come with different neighborhoods.

The cover of the Winter 2019 edition of Shelterforce magazine, which focuses on housing markets.
The cover of the Winter 2019 edition of Shelterforce magazine, which focuses on housing markets.

After the housing crash of 2008, one of the pieces of wisdom many people said we had learned from it was that there wasn’t “a national housing market,” but rather a whole bunch of very different regional markets and neighborhood submarkets.

Like many lessons, it may have only been partially absorbed, however. Thanks to the big-data work of researchers like Raj Chetty, there is significant widespread understanding about the vast differences in life outcomes that statistically come with different neighborhoods. The housing markets in these regions and neighborhoods also differ.

And yet, as prices skyrocket in popular, high-profile cities (and a small handful of neighborhoods in other places), I’ve noticed a growing assumption that that’s what’s happening, or about to happen, everywhere. At one conference I attended last fall, mere hours after the keynote speaker showed data demonstrating that in most cases formerly redlined areas were still suffering the effects of those practices in the form of disinvestment and poor quality of life, another speaker said all formerly redlined areas were now in the process of gentrification.

This isn’t so, and to talk as if it is will poorly serve the many residents of those neighborhoods and rural counties where poverty is increasing, lack of investment is holding steady, and displacement comes in the form of crumbling housing, unsafe conditions, and lack of income.

In this issue we look at many different kinds of housing markets and their implication for our work. Alan Mallach discusses what a housing crisis looks like in a place where housing prices are not high, and what the policy responses might be. Carey Shea suggests a different form of federal tax credit to address the difference in construction costs and market value in low-value areas where revitalization is not a given, but continues to be hard fought for.

Frank Woodruff and Paul Brophy discuss middle neighborhoods, those places that are neither booming nor distressed, though they often have the potential to become either. These neighborhoods are fascinating places—many of them are experiencing both increases in poverty and higher-income residents at the same time. They tend to be more racially diverse than other neighborhoods, and more stably so, and to be home to large numbers of immigrants and homeowners of color.

Perhaps these should be the “neighborhoods of opportunity” we focus on developing and making sure everyone has access to. They have a combination of existing assets like schools and retail and transit without so many of the negatives of social isolation and discrimination that come with truly affluent and exclusionary communities. Supporting them in what they have and making them accessible to more people should be relatively lower cost for the results. Obviously we still need to address the problems of exclusionary communities, gentrifying communities, and persistently distressed areas—but stabilizing middle neighborhoods is an important piece of that puzzle. It is also one that will protect the financial health of cities, since they generate a large amount of tax revenue, allowing local governments to continue to serve all their constituents, and hopefully to provide the extra help the most vulnerable need.

And finally, it can’t be ignored that the affordability situation in an increasing number of large, hot-market cities is dire. From the Bay Area to Seattle, Boston, D.C., and even Minneapolis and Atlanta, homelessness is rising and displacement due to rising rents is disrupting the fabric of longstanding communities. In many of these places the problem of housing costs has begun to hit home for people of much higher incomes than have historically had trouble finding housing.

One of the things this has given rise to is a new group of housing activists calling themselves the YIMBYs, for “Yes, in My Back Yard,” an allusion to their focus on increasing the supply of dense housing to bring costs down. Their emergence has been marked by deep schisms over housing economics—does a simple supply-and-demand argument work for housing? And if not, how not? Could new market-rate housing have a “block effect” where it signals safety to invest and opportunity for profit on a micro scale even while lowering average rents on a wider scale? What is the time frame on which these processes operate, and what other policies should be put in place in the meantime? How do anti-displacement and affordability interact, and how do we prioritize them?

There is no way we can attempt to answer all of these questions in a single issue of Shelterforce, but in these pages we take an in-depth look at two aspects of the situation. Rick Jacobus takes on one part of the housing economics question. And I look at the interrelationship of these new activists with the affordable housing and housing justice organizing worlds, and how it differs markedly around the country. I’ve also written some extra pieces about some specific issues we didn’t have room for in these pages. To see more of our coverage on this topic, visit shelterforce.org/tag/YIMBY, and sign up for Shelterforce Weekly to make sure you don’t miss new installments at bit.ly/SFWeeklySignUp.

This editor’s note appears in the Winter 2018-19 edition of Shelterforce magazine. Subscribe here.

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