A few years ago, when I worked on affordable housing policy, we (with Janet Smith of UIC) took a detailed look at Census, HMDA, abandonment, etc. figures for Chicago neighborhoods and came up with a “cluster” grouping of neighborhoods. The clusters weren’t really used in the final analysis, but they did make sense:
* a big chunk of the city was still stuck in decline, with high vacancy
* huge swaths of immigrant neighborhoods were economically healthy but suffered from overcrowding
* a few areas were (statistically) stable and balanced, but reports from the ground indicated impending gentrification
* some areas were undergoing rapid gentrification without new supply
* other areas were gentrifying, but adding supply that matched demand.
For-sale prices in the last three categories (there were seven, I’ve forgotten two) were all rising, with one exception: Chinatown, where prices were stable and indeed, fairly low. It turns out that lots of new housing was built in the 1990s. Light amounts of subsidies (TIF, 202, muni bonds) paid for infrastructure, senior housing, and community facilities, but most of the housing was built by local builders for community residents.
Earlier this year, a former coworker and I talked about Chinatown, and she found the other part of the picture: the financial ties that keep capital circulating through the neighborhood, and to a certain extent keep neighborhood property out of the hands of speculators on the general market. She wrote a neat article after that.
Similar reports from nearby Latino neighborhoods indicate that they’ve managed to avoid gentrification and keep housing affordable to working families through similar methods, keeping transactions within a local market, as opposed to the wider, Realtor-driven market.
And, for what it’s worth, the voluntary inclusionary policy in Chicago creates about 500 units a year out of 10,000 or so built every year. To ensure long-term affordability, individuals and communities can opt (perhaps partially) out of the market system of ever-inflating prices and into a system that views housing as a non-market good. Models like Community Land Trusts and limited equity cooperatives allow people to take their land, opt out of the market, and provide stable, low-cost, legal, no- or low-subsidy housing in perpetuity. The key is to enter the neighborhood at the right moment: before the big run-up of land values that accompanies gentrification (which often roughly coincides with the neighborhood’s debut on the MLS).
(posted to urbanists)