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The Economics of Gentrification in Washington, D.C.

The Economics of Gentrification in Washington, D.C.

This past decade has seen Washington, DC host one of the most rapid transformations in the United States. Once a city in decline, known for crime and plagued by disinvestment and poor governance, a quick look at the District’s skyline will tell you that much of that is no longer the case. With forty-seven cranes

This past decade has seen Washington, DC host one of the most rapid transformations in the United States. Once a city in decline, known for crime and plagued by disinvestment and poor governance, a quick look at the District’s skyline will tell you that much of that is no longer the case. With forty-seven cranes operating throughout the city, new apartment and office buildings are rising up all the time. In older neighborhoods, typified by row houses built at the turn of the last century, developers are coming in to renovate, gutting buildings and keeping as much of the historic façades as possible. But what has spurred this resurgence after decades of decline?

Brand new apartment buildings opening on Florida Ave NW in Washington, DC.

Much of the answer can be found in the areas residents. In addition to long time residents and government employees, young professionals from all over the country are flocking to the Capital. And why not? Washington, DC has one of the strongest job markets in the nation. And, as plenty of economists will tell you, people follow jobs.

But people also follow their own preferences for a place they would like to live. The demand for walkable, vibrant neighborhoods with a mix of uses and access to transit is growing constantly. This demand is primarily being generated amongst the young, educated cohort of Americans we mark with the moniker of millenials, but older generations, like the baby-boomers, are also exhibiting this preference. The renaissance of American cities comes with consequences, however, one of which is gentrification.

A house being renovated in a gentrifying neighborhood in Washington, DC.

At its heart, gentrification is a supply and demand problem. For too long, development in too many places focused on creating drivable suburban neighborhoods. Now demand is shifting toward walkable urban places, and they are in short supply. Compounding this is the fact that it is older neighborhoods that have the framework in place to support the type of urbanism people desire. And in Washington, DC, this problem is being compounded even further, with the DC Height Act placing an artificial limit on housing supply.

So, with short supply and high demand, land values are being driven up, which is forcing out long time renters who can no longer afford to live in their neighborhoods. In the District we are seeing this process playing out in a swath of neighborhoods simultaneously. It began with redevelopment focused around transit corridors, but now the wave is sweeping from west to east.

While understanding the problem is one thing, solutions are another, but is there anything that can be done for lower-income residents who can no longer afford to live in the place they have called home for so long? Urban planners have implemented an inclusionary zoning policy, but can it really solve the problem, or by forcing developers to charge less for some apartments are we merely prompting unforeseeable reactions from the market? 

Is this a problem that can only be solved by the same market forces that have created it?

Credits: Images by Chase Keenan. Data linked to sources.

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Growing up in Tampa, Florida, Chase Keenan learned first hand what it means to live in a city that is built for cars rather than people. The influence of this experience, and his recognition of the urgent threat climate change poses, led him to pursu...

  • Darling Chase, I am so proud of you and the blog is wonderful. Can’t wait to see you and looking forward to discussing your excellent writing and photography — I know it comes from Grandma Mary. Love you, take care.

  • Jaime Solorzano

    Chase, great article about one of my favourite cities! Market forces will force people to look for housing without benefits from centrality. Gentrification is not bad at all: DC renewal is incredible, and the development policies of central areas could consider the DC case. However, there are problems that must be faced by the government with subsidies and other instruments that will provide some kind of support to the affected population.

  • Transit oriented development, along with gentrification, is a dangerous trend that is causing significant risk of displacement.

    Take a look at this article:

    While we hear promises made that housing will be reserved for residents displaced by gentrification, typically less than 6% of original residents return. The article above states:

    “Today, of the approximately 5,000 families who ultimately were displaced in the public-housing demolitions, only 332 live in the new mixed-income communities that went up in their place.”

    While in Marin supervisors, social equity advocates and HUD clamor to address a perceived equity imbalance affecting low income minorities, they are targeting Marin City for gentrification and redevelopment. While Marin has a disproportionately low ethnic and low income population such an effort would serve to reduce Marin’s diversity by displacing a large concentration of low income black residents.

    Transit oriented development is a godsend for developers – allowing renewed ability to target such areas that previously had been off limits. Marin City is especially attractive as it sits just across the bay from the urban center of San Francisco.

    Again the moral here is that gentrification is not always good. There are many factors to consider. And those advocating transit oriented development need to recognize that others with less altruistic interests are jumping on the bandwagon – for monetary gain.

  • Thanks for the comments everybody.

    Richard, right away I have to disagree that transit oriented development is a dangerous trend. A dangerous trend is to continue building cities oriented around the automobile which is not good for the environment, and not good for the people living in them now, or in the future. People being displaced is certainly an important issue, but it is not the only issue that needs to be considered as we seek ways to improve our cities.

    That said, yes, TOD can be a catalyst for gentrification. And yes, it is good for developers, which is one of the reasons it is able to work. But what we need to do is find ways to ensure that there are a range of housing options available to people of all incomes. From low-income housing tax credits, to inclusionary zoning, density bonuses, and subsidies, there are a range of tools available to help low-income families live in comfortable, affordable places. It’s about finding the right balance that works in the right place, and generating the political capital to make that happen, which sometimes require major revisions to land use policy.

  • @Chase
    I think there’s common ground. Transit oriented development can work in major cities and urban areas. However the theory breaks down in suburbs, and unfortunately with regional projects such as “Plan Bay Area” we’re having urban policies imposed on suburban and rural locations where they just don’t fit, and where the densities are out of place.

    Then we’re seeing California Senate Bill 743 impose disregard for traffic impact – as if almost naively the assumption is that all the new residents won’t be driving or parking. High density can be put into place causing significant parking and local traffic impact – without any need to consider or mitigate this impact.

    Providing options is one thing, but in the Bay Area ABAG is using radically inflated population growth projections to pave the way for rapid development. There’s near zero outreach to the community who discover they’re being railroaded. Community input is suppressed.

    ABAG – Planning for a Population Explosion:

    Rigging the Community Input Process:

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