Strategies for Economic Diversity in Gentrifying Areas | How Housing Matters

Strategies for Economic Diversity in Gentrifying Areas

November 09, 2016  

As local attention turns to rising challenges with housing affordability and gentrification, cities can pursue several strategies “to supplement policies that encourage new development with those that promote preservation of affordable stock and protections for lower-income households,” according to a report published by New York University’s Furman Center. Researchers catalogue multiple approaches for achieving two goals: “creating and preserving affordable housing in gentrifying areas” and “assisting tenants at risk of displacement.” The authors put forward tools to use city-owned land, other city resources, and market interventions strategically to create and preserve affordable housing. Cities can also improve their ability to manage the relationship between landlords and tenants and help low-income households relocate to protect them from gentrification. The authors discuss the pros and cons of the various strategies, but do not empirically evaluate their effectiveness.

Key findings:

  • City governments can preserve the affordability of publicly owned land, which is made available for development through ground leases, use restrictions, and community land trusts.
  • Cities can use housing subsidies and tax breaks in areas that are beginning to gentrify to “lock in affordability.”
  • Inclusionary zoning and linkage fees can create and preserve affordable housing through mandatory and voluntary programs that engage developers in strong markets.
  • The pressures that displace current residents can be mitigated by regulating rents, limiting causes for evictions, enacting laws that protect tenants from harassment, providing tenants information about their rights; and strengthening the enforcement of tenants’ rights.
  • Local policies and resources, such as priority housing access, relocation assistance, and unified tenant screening programs, can assist at-risk tenants who are displaced in redeveloping areas.
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Source: New York University Furman Center
Author: Luke Herrine, Jessica Yager, Nadia Mian
Publication Date: 2016
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  1. photo
    Joe Beckmann
    Posted 2 years ago

    The challenge is to harness gentrification, not to fight it. To fight is to lose; to share is to win.
    The easiest way to harness inflationary pricing in housing is to tax it, or to levee a fee to support alternatives other than inflationary pricing. Such fees might be just as appropriate to inflated pricing of both commercial and industrial properties, to recycle those funds to support incubator enterprises for, again, a share of their growth.
    Some of these policies have been tracked – where there’s plenty of open space for land banking – in places like Nantucket and Martha’s Vineyard, where a transfer tax recycles into more open space investment. But there are very few data regarding Land Banking in denser, more urban settings, in spite of the feasibility of graduated fees reflecting a percentage of selling costs when and where inflation is displacing affordable options. Why? This doesn’t seem like rocket science. So, why? and why does this study even ignore the impact of limited equity options as likely investments to retain long term residents and recycle the tax benefits of ownership?

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