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Title: Staying Put: Are Low-Income Homeowners Better Positioned Than Low-Income Renters To Withstand Gentrification Pressures?

Citation Type: Dissertation/Thesis

Publication Year: 2008

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Abstract: The course of urban history in the United States has never run smoothly, and Chicago's path is no exception. As middle and upper income residents fled core city neighborhoods in favor of the suburbs, low-income residents remained behind to endure the deterioration resulting from a lack of capital to invest in neighborhood upkeep. The real estate and financial industries exacerbated the decline by refusing to provide loans to residents of these neighborhoods. Both economic and government forces historically have harmed these communities and their residents. Yet, even today when government policies forbid lenders to avoid these neighborhoods and the flow of capital is improving local assets, the very process of urban revitalization places low-income residents in vulnerable positions. Traditionally, homeownership was the most important asset, but it remains unclear whether it lessens the risk of displacement by these residents. The present study addresses the question of whether housing tenure plays a role in how well a household withstands pressure to move resulting from gentrification. Previous studies had either focused solely on the displacement of low-income renters or examined the situation of homeowners from a qualitative angle. This paper provides to these issues a quantitative examination largely absent from the existing body of literature. A series of ordered probit models employing a sample of low-income residents from the 77 community areas of Chicago estimates the interacted effects of housing tenure and gentrification on duration of residence, controlling for the socioeconomic factors that the literature indicates play a role in both decisions to rent or own and in how long to stay put. The results of these models indicate that low-income households facing high levels of gentrification are statistically significantly more likely to stay longer in their homes if they own rather rent. Renters are most likely, with a probability of 39 percent, to live in their homes between two and five years when faced with high levels of gentrification. Homeowners under similar conditions, in contrast, are most likely (24 percent) to reside in their homes between 11 and 20 years. The evidence of this analysis, therefore, supports the hypothesis that homeownership provides a protective effect even to low-income populations facing pressures to leave. Based on the result of this study, policymakers would do well to focus more energies and resources on promoting and sustaining homeownership among low-income populations, especially those residing in communities experiencing the onset or continuing changes associated with gentrification. Current government supports for low-income rental housing, such as housing tax credits and Section 8 vouchers, are unlikely to be effective for low-income households facing conditions of dramatic neighborhood change.

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Authors: Beach, Karen M.

Institution: Georgetown University

Department: Georgetown Public Policy Institute

Advisor: Donna Ruane Morrison, Ph.D.

Degree: Master of Public Policy

Publisher Location: Washington, DC

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Data Collections: IPUMS USA

Topics: Housing and Segregation, Labor Force and Occupational Structure, Poverty and Welfare

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