It’s not all coffee shops and hipsters: what we get wrong about gentrification
Leslie KernCommunities should mobilise against the property industry and its partners, not the people who move in their wake
Why should people oppose cleaning up, tarting up, a place?
’…the harbingers of doom for working-class, minority communities in cities around the world.’
Why assume working class and minority communities don’t want to live in clean, crime free areas? Bit classist and racist, isn’t it?
Any mention of rent control disincentivizing landlords from maintaining apartments and storefronts? Nah, rich people bad.
“working-class, minority communities in cities around the world.”
If you’re sitting on expensive land, and earning piss all, you should be living somewhere cheaper. You have no right to live in Sandbanks, Henley or London. Move your “community” to Sunderland.
I think that the point being made is once the area is nice then private rents will go up and the existing residents will be evicted when their contracts end.
Unsurprisingly such forced relocation is unwelcome.
My personal solution to this problem is to set fire to the planning regulations and build. In the long run rents will fall. Boris had the right idea but a back bench rebellion killed it.
Such are the problems of the non-working class.
Hmm. White people leave an area when non-Whites move in = White flight = bad. White people move back into an area = Gentrification = also bad.
Anyway, I have zero sympathy with the African or Asian residents of areas like Brixton; they’re simply getting a small taste of their own medicine. F**k ’em.
Oh, I think there’s something in what she’s talking about. There’s a cycle I’ve seen playing out in various areas of London.
Starts with an area that’s a bit run down but geographically attractive. The geographically attractive brings in novel retailers, service providers. Now the area gets a reputation for being “funky”. Both commercial & residential prices begin to rise. Pushes them out of the reach of new novel retailers & service providers & the existing ones start closing as rent increases become unaffordable. That brings in the estate agents, twee coffee shops, high end frock shops, those that can afford the high rents. Place ends up as another middle class ghetto.
Lived in one. Crouch End. Originally bed-sit land. Popular with the Paddies. Even had a sort of street market on a bit of land off of Park Road. Became progressively more funky through the late 70s into the 80s. Lots of interesting small shops. House prices & retail rents started rising. Then we started losing he amenity shops. Hardware store went. So did the greengrocers & the cheap butchers. The builder’s caff turned into a coffee place. By the time I left, the process was complete. Crouch End had about 50 restaurants & wine bars. A dozen hair salons. Umpteen estate agents. A butchers specialised in boar sausages. An authentic French bakers at £3 a baguette. A one bed flat was 400k & half the people lived there seemed to work for the BBC.
Nothing there now is particularly profitable. High prices, sure. But most of it gets soaked up in sky high rents. I dropped by there a few years ago on one of my very few UK visits. I’d say it had gone moribund. Heaven knows what Covid’s done to it. I should imagine there’s a lot of retail & office space voids. But commercial rents only ever go up, don’t they?
There’s something similar going on where I live now. Commercial rents & business taxes have been steadily rising for years. Half the restaurants & bars hardly break even. Covid left about 10% of commercial premises vacant. But rents haven’t gone down. Some of the voids have filled up over the last year. But they’re all with businesses need little capital investment. They seem to last about 6 months.
When your corporate landlord is trying to evict you so that your building’s units can be renovated into luxury suites, a nearby coffee shop serving a £6 flat white certainly adds insult to injury. Don’t get me wrong, the cafe is part of the problem: it’s capitalising on and attracting the kind of changes that may be about to boot you from your community for good.
But Maggie Thatcher was BAD for allowing the plebs to buy their own council houses.
Actually as Guardian articles go this one is not the worst I have seen. The author doesn’t look like an alien and think she is the first female ever to have a child. She isn’t some misogynistic gay who doesn’t like women, nor some aristocratic hypocrite who pontificates on the fate of the poor from her Tuscan Villa.
Nevertheless, the question to her would be – what is the solution longer term? The only ways I can see her model working is to massively incentivise investment in assets other than property and either severely tax property investments (Especially those by collective investment funds which is where the UK government hasn’t acted) or as near as possible outlaw buying property to rent. Either of the latter is likely to have enormous second order consequences. Ultimately only dictatorships (North Korea/ Burma) are able to set up their cities almost to be preserved in aspic with the same inhabitants for generations.
bis
I think we will see a flurry of vacant lots globally with the coming energy price spike. Longer term I think Klaus Schwab intends that all leisure will take place in the metaverse – both retail and holidays.
She’s missing one important detail: housing stock. Crouch End gentrified not just because of the good location, but because it has big houses with high ceilings and wide bay windows. The east and southeast of London struggles to gentrify to the same extent because it’s all two-up two-down pokey cottages, despite the proximity to the City.
Van_Patten,
“Nevertheless, the question to her would be – what is the solution longer term? The only ways I can see her model working is to massively incentivise investment in assets other than property and either severely tax property investments (Especially those by collective investment funds which is where the UK government hasn’t acted) or as near as possible outlaw buying property to rent. Either of the latter is likely to have enormous second order consequences. Ultimately only dictatorships (North Korea/ Burma) are able to set up their cities almost to be preserved in aspic with the same inhabitants for generations.”
Quite. People have always moved to where the work is, or to where housing is cheap if they aren’t working much. Do people think London, New York, Mexico City always had the shithole neighbourhoods that they do? No. At one time, people farmed on there. A lot of people haven’t been in London for more than a couple of generations. 100 years ago you’d have had factories and breweries being built in the East End, and the workers getting houses and someone else being forced out. Probably farmers.
And this is right, this is how it should be. This is a feature, not a bug. You want quants living a short commute from the city. The retired, the low earners and the permanently unemployed should be in Lincolnshire. Plenty of cheap houses up there. We already distort London by paying housing benefit, so poor people can live there while better off people have to spend time commuting.
London. Other locations are available.
or as near as possible outlaw buying property to rent.
I certainly wouldn’t mind seeing an end to lending to buy property to rent. Doesn’t mean it would be impossible to capitalise. Just that it would need to be done with equity, not loans.
BiS
The only issue I’d see with that is it just leads to property being owned by corporations not individuals as they’re the ones with sufficient equity to buy it. I think China owns vast swathes of Manchester (for example)
Corporations are owned by individuals, aren’t they?
I wonder whether two willing parties shouldn’t be allowed to make a contractual agreement without interference by the government or the council. What do I care about my landlord’s financial arrangements as long as he keeps up his end of whatever agreement we have made?
Freedom. What a concept.
It’s about where the risk goes, VP.
Shortly we’re going to hear a great deal of wailing from the BTL sector about rent arrears & rising interest rates.”The government should do something” Why? Should using a small amount of money leveraged by preferential access to credit to create an income stream be risk free?
bis
To your Last comment absolutely agree.
Regarding the ‘firms vs. indvidualls, With private REITs then I agree. Not sure how many shareholders there are in a Sovereign Wealth Fund or in the case of China some state controlled entity but agree otherwise.
Her photo shows someone fit for a minor role in a Wodehouse novel. An Aunt Violet, let us say, known for a tendency to interfere incompetently in the concerns of the lower classes while finding it hard to keep servants.
I have the solution. Ensure your community has sufficient levels of crime, drugs, pollution and civic disregard to deter incomers.
Some south London districts have achieved this for two or more generations. Around the Gare du Nord (Paris) or east Lyons the process is in its infancy.
Philip
When I worked in that vicinity (South London) I used to admire the ‘impact of diversity’ in somewhere like Thornton Heath with a sense of real wonder – realising this was all ‘home grown’. And that was 15 years ago. How many more Thornton Heaths do we have now?
Just scrap Housing Benefit – yet another example of the State interfering in the marketplace to fiddle prices.
Does anyone think that if HB is scrapped then BTL landlords will start demolishing houses? I suspect they will either (i) accept lower rents, or (ii) sell the house for whatever the market will bear. Either way, the tax-paying HB-funding punters will be better off.
Quite so, Rhoda, if people wish to borrow money to provide any service to others, that should be their right. Renting property is no different than selling food, medicines, holidays, cars, etc. In each case, transactions are freely entered into between those providing the service and those requiring it.
You could ban hardware stores and lumberyards, or perhaps regulate the possession of tools at least as strictly as you regulate firearms.
One point that does seem to be missed is that it is the working class that do the actual renovations. Traitors to their class?
@DocBud
At artificially low interest rates? Debtors get richer, lenders get poorer?
Why should people oppose cleaning up, tarting up, a place?
Self interest. They know it’s not being cleaned and tarted for them, it’s being cleaned and tarted for their replacements. I’m not saying the why is justified, just that that’s the why.
See also holiday homes, Brexit, etc.
BIS, we don’t get to set the interest rates, we just to accept whatever they are.
If someone else is keeping interests rates artificially low, it makes sense to take advantage of that.
@Doc Bud
“BIS, we don’t get to set the interest rates, we just to accept whatever they are.
If someone else is keeping interests rates artificially low, it makes sense to take advantage of that.”
Then accept the risk that this situation might not be permanent. But already we’re hearing wailing & sobbing that “something must be done!”
BiS, maybe they only wail because they think something will be done, based on past experience of other people wailing. The greatest thing we could ever insist on is that you are responsible for your own choices.
PJF,
it’s being cleaned and tarted for their replacements
Now now, the Great Replacement is just a conspiracy theory. Who are you going to believe, me or your lying eyes?
“The greatest thing we could ever insist on is that you are responsible for your own choices.”
Since when was that the thought of the day?
already we’re hearing wailing & sobbing that “something must be done! Most BTL landlords are more concerned about the government’s punitive tax regime and eco-regulations than movements in interest rates.
There is literally no sane reason to impose a ban on borrowing for real estate. Even Sharia law has ways round its own foolish requirements.
Incidentally, one only has to read the article to realise this applies to the person who wrote it. Of course she never went to any of these areas when they were run & forgotten. She was part of the funkying-up process. She liked them when they were only popular with people like her. She now resents they’ve become popular with people with more money than she has.
We accept that interest rates change and that is a potential business risk. With commercial property we protect ourselves with long leases and CPI increases. With domestic rentals, we are subject to supply and demand. Here in Australia, we are still able, quite reasonably, to deduct interest from profits, just as any other business can if they borrow to purchase equipment.
davidsb,
“Just scrap Housing Benefit – yet another example of the State interfering in the marketplace to fiddle prices.
Does anyone think that if HB is scrapped then BTL landlords will start demolishing houses? I suspect they will either (i) accept lower rents, or (ii) sell the house for whatever the market will bear. Either way, the tax-paying HB-funding punters will be better off.”
The right answer (for starters) is to cap HB at the median rent for the UK. Which is probably Worcester or Northampton. So, people will have a roof over their heads, just not in expensive places.
The main inflator of asset bubbles is low interest rates. UK housing has defied gravity because of this artificial suppression.
But banning property loans on BTL is not the solution. Interest is no longer tax deductible from rental income. And the govt has added more disincentives such as fire doors, minimum communal space in HMOs, etc. So landlords are already being hammered.
So when interest rates rise the bubbles should burst, right? Housing crash, zombie companies going under, etc. Dream on. They’ll use any excuse to do more QE and get back to low rates, even as inflation goes through the roofs.
Can you imagine?
“You there, stop repainting those shutters! You’re driving up the property value!”