The internet is full of articles on real estate; what to do,
what not to do, how to sell fast, sell high, buy low, and most of it is helpful
… unless you happen to live in an area where the rules of real estate don’t
apply.
What could that possibly mean? Some areas within major cities, most notably the outer
boroughs of New York City just don’t follow the trends. The two most common
reasons are high interest from a particular ethnic group with financial
resources, or gentrification.
Gentrification is the term used to explain why neighborhoods that might
not have previously been in great demand become very valuable it is a process
of renovation of deteriorated urban neighborhoods by means of the influx of
more affluent residents because those neighborhoods are still attainable when compared to the
centers of culture and employment nearby.
The Brooklyn real estate market is a great example. During the period from 2008 through 2010, while the rest of
the country’s real estate market suffered a steep decline in home values and
the mortgage market crashed, Brooklyn real estate home values continued to
climb. The Brooklyn real estate market
is unique due to the borough’s cultural and ethnic diversity and proximity to
Manhattan, so the factors that influenced this unique real estate phenomenon
included the supply and demand ratio only found in the Brooklyn real estate
market as well as the resurgence of neighborhoods. Some of the most sought after neighborhoods
were once considered undesirable, but are now in high demand by buyers of all
races due to the spill-over from would be buyers who want the convenience of
living near Manhattan, but can’t afford Manhattan’s un-affordable real estate
market.
Gentrification has become a common and controversial topic
in politics and in urban planning. Conversations surrounding gentrification
have evolved, as many in the social-scientific community have questioned the
negative connotations associated with the word gentrification. The resurgence
of Neighborhoods like, Bedford-Stuyvesant , Williamsburg, Bushwick,
Ocean hill, to name a few, have been affected by the resurgence, according to
the National Percentile Rank, the median Income in these neighborhoods is
$21,706., the makeup of these
neighborhoods’ are Blacks 58.5% ,
Hispanics 33.6% and other races 7.9%.
What does it mean for current owners? Gentrification can lead to community displacement for
lower-income families and have a negative impact on the low income, poor, or
retirees who have lived in these communities for decades, who now have
discovered that their homes are worth millions. Does this make them
millionaires based on the equity of their property or is equity an “illusion”
to these low income home owners? That
all depends upon the answer to the real questions, which are – can these
homeowners sell their existing homes and relocate comfortably? And where would
they go when their home is their only real asset and their income is low.
In the final analyst, one might argue that there are
positive aspects about Gentrification, such as rebuilding, and bringing Value
to Neighborhoods and Cities that was previously undesirable, but when the
wealthy or higher income occupies these communities are the benefits equally
shared? Dose it damage the cultural and social fabric of these
neighborhoods? So, while many Brooklyn
homeowners may be sitting on a veritable goldmine, unable to access the equity
in their home leaving them no other alternative to sell. The question remains
does this mean that they are displaced millionaires, who are neither here nor
there?
Email info@sharonrfrank.com
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