Why the Furman Center Report on Gentrification is More Troubling than it Looks

Last week the NYU Furman Center released its annual report on the state of NYC housing and neighborhoods and, as usual, it is a wealth of well-presented data and well-defined analysis.  Any readers of this blog will see familiar themes and trends, but I wanted to touch quickly on one of the major focuses of the report: gentrification and its cause/effect on demographic shifts and rent burdens.

Each year, the Furman Center focuses the first part of its report on a specific area that is having an impact on policy discussions (last year's was density) and this year it chose gentrification.  What this term actually means and what, if any, affect it has on the city is surprisingly controversial in many academic and media circles. (Full disclosure: Lance Freeman was my advisor at GSAPP.)  This is largely because the word itself has become so saturated in our culture that it can bend and twist to mean just about anything - just as 'hipster' or 'basic' have lost whatever useful purpose they might have had. (I've been called both which would seem to be a contradiction.)

The Furman Center (rather conveniently) sidesteps this discussion and quickly states that gentrification has become an accepted term in general and offers a specific definition for the sake of the report: rapid growth in rent in a low-income neighborhood from 1990 to 2014.  Quibbles aside, I think this is generally a helpful way to approach current gentrification in NYC, if not the long-term implications. They split the 55 city neighborhoods into three categories: high-income, gentrifying, and non-gentrifying. Put through their defined filters, they identify 15 neighborhoods that are gentrifying. Anyone familiar with NYC will recognize the usual suspects (Williamsburg, East Harlem, Astoria to name a few.)

 (all data from furman center)

(all data from furman center)

You might be reading this and/or be looking at the neighborhoods listed, and be thinking, "Well, duh."  That's understandable.  People have been complaining about the same neighborhoods gentrifying for years.  (The only potential positive over the L train shutting down is the drop in gawking tourists on Bedford Ave. Not that I'll ever be able to reach it from the East Village.) But what the report nails (and what some sources, like the WSJ, totally missed) are the nuances within these neighborhoods that reveal the larger affordability crisis across the city.

The data in gentrifying neighborhoods initially shows what you would stereotypically expect: young, college-educated, higher-earning, largely-white singles moving to these neighborhoods.  OK, knew that (and knew it doesn't mean they will stay for long). But more telling in their analysis, Furman also shows an increase in the concentration of poorer (and older) residents alongside this other group - rather than showing the stereotypical displacement you would expect.  The report explains that some of this is because of the higher representation of new housing construction and public housing in these 15 neighborhoods relative to others in the city. They don't have helpful graphs and tables to show the lack of displacement, but they still make an important point. The widely publicized idea of displacement is not happening as often in practice. 

They don't claim that displacement isn't happening, but they also show convincingly the larger, scarier trend: a massive increase in rent burden for existing residents. I've talked about this idea of being 'squeezed-in' before and this report shows just how widely felt this problem is across all neighborhood types (more on this later.) It is more visceral to imagine people packing up and moving rather than forgoing other purchases, but this is the larger problem hands down.

 

When you see the income and demographic data in these gentrifying neighborhoods over this time period, you start to understand how they represent a microcosm of the larger forces at-play in NYC driving up the housing costs for everyone.  The city has slowly recaptured the population lost in the 1970s and 1980s and the economy has emerged from its painful deindustrialization into a modern service/creative classes form with lots of low-paying service jobs. However, this has not lead to a huge increase in the housing stock or a huge increase in average income for New Yorkers. 

As a result of these forces, gentrifying neighborhoods present a troubling front line in a battle playing out for the broader city's future.  I don't mean this in terms of hipster vs non-hipster, or rich vs poor, white vs non-white, or young vs. old.  These micro-fronts are more perception than reality or at least smaller pieces of it.  The more pressing battle is between what I would loosely call a 'lifetime city' vs a "lifestyle city." 

I define a lifetime city as a city that has ample opportunity and resources for individuals and families across all income and age levels.  It doesn't necessarily mean some type of utopian city, but one that would look familiar to New Yorkers at the turn of the century up through the end of WWII.  You could be poor, middle class, or rich somewhere in the city.  You could be born, grow, raise a family, get old, and die all in the city.  It wasn't 'equal' by any stretch of the imagination, but there was ample movement and space within income levels and occasionally between them.

A lifestyle city is a city that provides opportunity and resources only for individuals and families in a narrower income bracket or a narrower lifespan while denying them to the broader swath of population - resulting in greater income/age/racial disparity.  You can see that already in the extremely wealthy neighborhoods in NYC and in pockets of gentrifying neighborhoods that cater to the young, wealthy, and childless. The city becomes a vacation home, a temporary stop before settling somewhere else, or just a wealth dump while a near-permanent underclass cleans the dishes.

This battle is playing out in gentrifying neighborhoods right now in a public fashion, but step back from these 15 neighborhoods and consider how the Furman Report treats the other 40 neighborhoods of NYC. There are only 7 'non-gentrifying' neighbors.  That leaves a whopping 33 neighborhoods, or 60%,  that the report classifies as 'high-income."

Another way to look at it is that the city has three states for neighborhoods: "pre-gentrified," "gentrifying," and "post-gentrified."  If that's the case, the battle doesn't look so small and doesn't look so hopeful.

From that perspective, as the Furman Report points out, you see what a vast problem affordability is for policy makers in NYC across all types of neighborhoods.  For the few remaining non-gentrifying neighborhoods, incomes have gone down by several thousand dollars since 1990 and rent burdens have skyrocketed. In high-income neighborhoods, poverty levels have remained steady, meaning the poor are effectively stuck in these neighborhoods.  It remains to be seen what the vulnerable residents in gentrifying neighborhoods end up resembling, but it's getting harder to see where the poor, the old, or families can live in NYC.

The Furman Report isn't heavy on policy prescriptions by design, but addressing this problem through the lens of gentrifying neighborhoods is incredibly helpful.  Rather than looking for policy recommendations right now, we should first recognize that there is a philosophical battle taking place, consciously or unconsciously, across the city and we have to determine who's on what side. I don't think the lifetime or lifestyle battle is mutually-exclusive mind you, but we are clearly treating it as such and are facing dire consequences as a result.