how does gentrification keep happening if there are less rich people than poor people?
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Less rich people who have more money. Urban environments can be very desirable places to live. A lot of people who aren’t rich, but are financially comfortable, can’t afford to live in rich people areas. So they find something they can afford in poorer areas, remodel, and hope others do that and drive property prices up.
The rich probably have little to do with gentrification directly. The rich are wealthy enough to live in already established and wealthier neighborhoods.
Gentrification is more typically driven by younger and more upwardly mobile workers who are establishing themselves. Because they lack wealth but have steady incomes, they move into more affordable neighborhoods. These people are consumers and they attract more retail and other businesses. This increases the desirability of the neighborhood and home prices and rents increase.
Although gentrification is portrayed negatively, this is a rather odd viewpoint. Why wouldn’t society broadly benefit from their younger, generally more educated, professional, higher spending group be the economic driver of redevelopment and improvement? It should be somewhat a measure of success that cities and neighborhoods revitalize and become economically significant.
Depends on the definitions of “rich”.
Gentrification doesn’t need to have Daddy Warbucks or private jet levels of rich to happen. In fact, odds are that the people who are considered the top 10% will just setup shop somewhere already nice.
I think understanding what gentrification is will help.
Upwardly mobile people, mid level corporate jobs, entry level tech, etc all are more driving forces of gentrification. In fact part of what drives it is because of the cheaper properties available to them. The idea of “yeah I can deal with living in this cheaper area because it’s what I can easily afford… may as well tidy things up a bit, get the city to add a bus stop, improve my home to increase property values and because I like it, a yoga studio opens up since that’s the gym I go to, petition for a Whole Foods…” and boom, now it is gentrified. Many gentrification areas specifically cite the increase in middle class.
Gentrification can be thought of as the encroachment of the less poor poor people buying up land and houses that used to belong to poorer poor people.
The problem is that when most of us have debt and often literally have less than zero dollars to our names, or have a net worth but it is in like, the single thousands of dollars, and there are other people with 11 zeros in their net worth (a hundred million times as much money) it’s really hard to describe anyone as anything but “poor” anymore
But some of the poor people are so poor that if they got sick and couldn’t work anymore for a few months they would lose their house. While other people are so poor that they already are sick, and they need to decide whether it’s more important today to buy medicine or food.
Clearest examples of gentrification often describe relatively small areas: individual neighbourhoods, specific parts of a city. Let’s focus on that scale.
Imagine a hypothetical gentrified neighbourhood. Let’s say there are 1000 properties to live in in that neighbourhood (apartments / houses), ready to be filled by whoever can afford them. Then, let’s say that in the city at large, there are 10 000 rich people and 1 000 000 poor people.
In this hypothetical, there are many more poor people than rich people. Nevertheless, if the neighbourhood is ultra-desirable as a place to live, there are still *enough* rich people to occupy all the properties. And it’s hard to blame the sellers for selling/renting to the highest bidder.
The process could be accelerated even more if those sellers start targeting the richer buyers specifically. Maybe they could merge two small apartments into one nicer one, and sell/rent it with a nice markup. If that happens at a large scale, you’re suddenly looking at your original 1000 properties to live in becoming just 500, admittedly nicer, but definitely pricier, properties to live in.
In other words, the absolute numbers of people matter, not just the proportions of rich vs. poor.
Another factor is that housing isn’t the end of the story. Businesses in a gentrified area may make the reasonable decision of targeting the new, richer inhabitants. Think: pricer stores, more luxury goods stores, fewer basic ones, etc. If the businesses’ own rents increase along with the tenants’ rents (and why wouldn’t they?), then businesses may essentially be forced down that path.
That means people either have to eat up the additional costs they may not have wanted in the first place (further driving up the cost of living in the area) or they have to travel outside their immediate area to fulfill basic needs (which makes the area not so great to live in anymore).
Gentrification isn’t ‘done’ by genuinely rich people. It’s done by the ‘middle class’. And it’s usually in very specific areas – namely inner city areas.
Young urban middle class is a demographic that’s grown over the past 20/30/40 years. Take New York. It’s population has grown by around 1.5 million from the 1990s to today. A large part of that increase is younger, college educated people who move to the city to get higher paid jobs. They can’t afford to live in Manhattan but they want to live in the city so where do they go? Inner city neighbourhoods where the prices are more affordable.
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