A Local Initiative that is Following Up on the National Discussion of Gentrification

November 26, 2018

Redeveloping communities across the country are facing gentrification and displacement pressures that threaten the well-being of low- and moderate-income residents. The pattern of gentrification and displacement is not always the same. Experts indicate that velocity is a key component. Once it is perceived that and area is an up and coming neighborhood, the velocity can be so rapid that it precludes efforts to manage change and forestall displacement. Effective strategies are being used to stabilize turnaround neighborhoods, promote economic inclusion, and preserve affordable housing. However, these tools are most effective in the early stages of change, when there is enough time to align resources to create a balanced mixed-income community. Early knowledge of neighborhood change is vital, however the most commonly-used publicly available indicators of neighborhood change, such as the American Community Survey, are updated with significant lag, and often not available until displacement and other negative effects have already occurred.  Fortunately, a new initiative is addressing this issue.

Turning the Corner (TTC) is a multi-city initiative led by the Urban Institute’s National Neighborhood Indicator Partnership (NNIP), the Funders’ Network’s Federal Reserve Philanthropy Initiative, and the Kresge Foundation to help communities identify more timely patterns of neighborhood change through quantitative and qualitative research. Data Driven Detroit (D3) is the local partner on the project. The goal of the TTC initiative is to help communities identify and track neighborhood change closer to real time, and provide the information to people who can take action to intercede.

D3 conducted work to develop a quantitative model with the input of community members and partners, and conducted interviews and focus groups with residents to better understand how neighborhood change impacts a community. TTC focused on neighborhoods with the potential for transformational redevelopment, which is the type of neighborhood change that results in displacement by altering the structure of the community, the lives and culture of the people who live there, and housing affordability. To ensure that all blocks in the data set are blocks with the potential for transformational change, D3 created the following criteria to remove blocks from the sample: Blocks with/where:

  • fewer than five residential structures
  • fewer than 25% of parcels have a residential structure
  • the median home value exceeds $150,000  

Of the 15,935 blocks in Detroit, 6,491 were removed from the sample using these criteria. The remaining 9,444 blocks were analyzed based on the following Index variables that were then combined into a Neighborhood Change Index Score

  • Housing market stability and resident transiency
  • Reported criminal activity 
  • Social measures that could contribute to higher turnover rates, such as tax foreclosure, blight violations, and water shutoffs
  • Business investment opportunities
  • Protective activities such as investments in construction permits for improvements and alarm systems that aim to protect the owner from liability and indicate a level of disposable income to reinvest into properties

Neighborhood Change Index Score

Using the interactive map, once a census block is identified in the Neighborhood Change Index as having conditions conducive to transformational neighborhood change, the individual indices provide a method for drilling down deeper into the area to better understand what factors may be most likely to affect change (and create potential for displacement). For example, census blocks with high or highest susceptibility to potential change show favorable scores in many or all of the five indices. In addition, the tool provides the user with information regarding variables influencing the score, such as: the number of blight violations, utility and water shutoffs on the social advantage scores; levels of commercial activity on the business index scores; and the impact of resident turnover and speculator-owned properties on the housing stability index scores.

The Neighborhood Change Index can help identify the types of action that may be most helpful in addressing the negative impacts of transformational neighborhood change. For example, if a neighborhood is identified as having the highest likelihood for potential change, local efforts to prevent displacement can begin sooner. Communities near high-income or rapidly changing neighborhoods can be alerted of early warning flags for vulnerability to displacement (particularly in connection with large investments). This index could also help efforts to deploy neighborhood stabilization and block grant funds more effectively in distressed neighborhoods facing redevelopment.  Further, using the NCI, community organizations and affordable housing advocates can identify specific factors that may be affecting at-risk neighborhoods, allowing them to strategize policy actions to address the possibility of displacement. The results of the analysis also can help communities that are not at immediate risk for rapid change to further understand what areas of investment could have the greatest impact on the long-term sustainability of their neighborhoods

The views expressed in this post are our own and do not reflect those of the Federal Reserve Bank of Chicago or the Federal Reserve System.

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