So a developer working with the government and getting incentives builds a nice neighborhood of homes that people can afford. People in the target income group buy the houses. All good. But when housing prices spike, what keeps the houses in the hands of the targeted economic group. When owner goes to sell, won’t the market dictate what happens, opening up the neighborhood to what has been referred to as gentrification?
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First is a lot of affordable housing is rental. So the leases may have limits and they may require proof of income to even apply for housing there.
If it’s owned property or there aren’t such lease restrictions, a few things can happen:
1) Poor people can move in and they can’t afford nicer stores, and rich people stay away cause they don’t feel it’s a great place or not safe
2) A handful of trust fund hipsters are willing to “slum it” but it’s still largely lower income
3) More hipsters come in, business move in to support them, gentrification takes hold, and property values go up. Then those who own can sell and make a profit. But again… most affordable housing is not owned by those living in it.
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