Title: GGR 357 H1F Geography of Housing and Housing Policy
1GGR 357 H1F Geography of Housing and Housing
Policy
Session 6 Neighbourhood transitions June 4, 2008
DR. AMANDA HELDERMAN
2Session 6 Neighbourhood transitions
- Announcements
- Midterm answers
- Neighbourhood transitions
- Factors of neighbourhood changes
- Theoretical models that explain transitions in an
area - Research methods
- Gentrification, branding, marketing
- Roles of culture versus that of the economy
3Announcements
- Paper assignment due June 20, 2008
http//individual.utoronto.ca/helderman - Dont wait too long with contacting me if you
have any difficulties! - Please consult previous lecture notes/ slides
before contacting me
4Announcements
- Final exam
- Similar format as midterm
- 85 about sessions after the midterm
- 15 about sessions before midterm
- Final exam on June 23, 2008, 5-7 pm
- Wilson Hall (New College)
- Room 1016
5Announcements
- Topics to tackle before the final exam
- Neighbourhood transitions - today
- Access to housing housing allocation Monday
(9th) - Housing affordability and quality Wednesday
(11th) - Meanings of home and attitudes toward
homeownership Monday (16th) - Reflection on the role of the government and
other actors in the public domain Wednesday
(18th) - Last session a review if schedule allows it
6APUS class representative (part 1)
- The association of Part-Time Undergraduate
Students (APUS) is accepting those summer
students who are taking 1.0 credits or less as
our members. We encourage you to participate in
APUS by becoming a representative for your class.
The following are some of the issues that APUS is
active in by addressing
7APUS class representative (part 2)
- tuition freeze,
- university/government financial aid for part-time
students, - part-time student on-campus housing,
- family care, and
- summer/evening course selection.
- As a class representative, you would receive
periodic information updates from APUS and keep
your classmates informed about upcoming summer
social events, meetings, important issues and
campaigns. You would also bring back to APUS
feedback you receive from your classmates on
issues and concerns. - Contact 416-978-3993 or info.apus_at_utoronto.ca
8Exam answers - Question 1
- a) Explain why housing is so attractive to
individuals (mention at least 3 reasons for 1
point each, up to 3 points). - Homeowners build up equity from their homes, they
enjoy on average a better housing quality, they
are free to customize their home, they are
independent and have full control over their
housing situation, homeownership represents
continuity and stability, homeownership to many
represents status, and finally it also represents
emotional value.
9Exam answers - Question 1
- b) Give 3 definitions of housing (6 points).
- Physical product/ facility (bricks and mortar),
commodity/ economic/ exchange good, investment
good/ asset, sector of the economy, social/
collective good, building block of neighbourhoods
(2 points each up to 6 points)
10Exam answers - Question 1
- c) What was Bournes definition of housing?
Include an example to illustrate what that means.
(4 points) - Housing can be described as a bundle of services
(2 points). Services that housing delivers
shelter, wealth, shelter from inflation
(capital), accessibility to services,
accessibility to work, accessibility to
neighbourhood, social status, right to privacy
(add 2 points for any of the examples including
an explanation of the definition).
11Exam answers - Question 1
- d) Why did he land on this definition(2 points)?
- All alternative definitions are applicable at the
same time, but some meanings are separated or
confused. Alternative 1 The definitions provided
previously overlap and are thus confusing
definitions to co-exist in explaining one and the
same concept. Alternative 2 They overlap and are
thus confusing definitions to co-exist in
explaining one and the same concept (2 points). - d) Mention 2 deliverables of housing in this
context (2 points). - Any two of the following 6 is correct Shelter
from the elements, value/wealth/equity for
owners, shelter from taxes, accessibility of
services, accessibility of work, accessibility
neighbourhood, social status, and/or right to
privacy.
12Exam answers - Question 1
- e) Describe why housing is important for
understanding neighbourhood dynamics (4 points). - Housing is the principle mechanism through which
urban neighbourhoods change moves of households/
activities (demographic change), new developments
(demographic, economic, social, cultural), aging
of real estate, and/or fluctuations in house
prices. Not all examples are necessary. Answer
must reflect some idea of how neighbourhoods
change through housing or rather the matching
process of households and housing (stock).
13Exam answers - Question 1
- f) Explain, by using an example, why housing can
mean different things to different people at the
same time (4 points). - Housing can mean different things to different
people at the same time. First it is an
investment good for the developer, and later it
can be an investment good for the owner-occupier,
anticipating that the property will increase in
price. To the construction company housing is an
industry, to the user the same object can mean
shelter. Any logical explanation is OK, as long
as definitions of housing are matched as
described under b. - So far all answers could be retrieved/ could have
been studied in Bournes chapter 2 and lecture
slides of the introduction/ first lecture.
14Exam answers - Question 2
- a) Mention the three classic ways of modelling
housing market behaviour (6 points). - Gravity Models, Push-Pull Models, Markov Chains
(2 points each, up to 6 points). - b) Explain the main differences in the
assumptions of these models (5 points). - Gravity models assumptions are based on the
characteristics of places, push-pull models are
based on the individual assessments of
characteristics of places, Markov chains are
based on the probabilities of moving to each home
in the chain of housing vacancies (4 points plus
1 point for the latter).
15Exam answers - Question 2
- c) Mention the two newer approaches (4 points).
- Microeconomic and life course approaches (2
points each). - d) Name one main difference and one commonality
between the two (4 points). - They both view moving behaviour as adjustment
mechanisms to adapt to new needs in the
household and/ or dissatisfaction. They both
incorporate micro-economic decision making. ?
16Exam answers - Question 2
- The life course perspective however, adds
individual perspective on how a move may occur
(by changes in the household, labour, education
and housing career). In other words, demographic
events (which are universal) are introduced as
milestones that help understand housing market
behaviour. The life course theory forges
theoretical and empirical work. (2 points for one
difference, 2 points for one commonality, up to 4
points in total.)
17Exam answers - Question 2
- Give two reasons why short distance moves occur
more frequently than long distance moves (3
points each, up to 6 points in total). - Short distance moves occur more often because the
dominating motive for moving (housing and
household motives) relate to housing
characteristics (3 points). (Larger house
required because more members in the household. A
better house, etc.) These motives do not incur a
long-distance moves like moving for a job might
do. If you move over a short distance, you do not
need to change jobs in most cases (another 3
points). Predominance of motives for moving thus
incurs more short-distance moves.
18Exam answers - Question 3
- III. Touch upon The parallel careers or domains
in the life course (mention at least three, one
point each, up to a maximum of 3 points). - Household career
- Housing career
- Education career
- Labour career
19Exam answers - Question 3
- How these trigger a move, by describing examples
(2 points each, up to a maximum of 6 points). - Household career triggers a move by
cohabitation, child birth, divorce/separation,
remarriage, widowhood through demand for less or
more space, or a necessary change in location. - Education career triggers a move by enrolling
into higher education that is not in the same
place as your parental home. - Labour career triggers a move by changing jobs in
a location to where there is no sustainable daily
commute possible. Generally this is due to
distance.
20Exam answers - Question 3
- Name 2 out of 4 life course stages (2 points
each, up to a total of 4 points). - The four life course stages are home making,
child bearing, child rearing, post child. - Describe what the link is between the life course
theory and housing demand (up to 3 points). - Households create a set of circumstances by their
combined behaviour. Alternatives are OK, within
reason.
21Exam answers - Question 3
- Explain what was so new about the life course
theory (name 3 innovative aspects out of the 6
discussed for 3 points each, for up to 9 points
in total). - Convergence of theory and empirical work
- Attention to individual households (micro-level)
- Residential location topic was brought into the
centre of housing studies - Individual action was linked with social change
and social structure - Demographic events were introduced as milestones
and critical transitions in peoples lives - The mechanisms are universal, applying to almost
anyone, and throughout history
22Exam answers - Question 4
- Touch upon The definition of social exclusion (3
points). - Social exclusion Social exclusion occurs when
people or groups decide consciously or
unconsciously, to put up barriers, preventing
others from full and equal participation, leading
to a loss of rights, loss of power, lack of
integration in society, affecting the ability to
live fully.
23Exam answers - Question 4
- Background factors of social exclusion (3 for 2
points each, up to a total of 6) - Backgrounds of social exclusion racial
discrimination, economic discrimination, gender
discrimination, health discrimination, poverty
discrimination, neighbourhood discrimination.
24Exam answers - Question 4
- The differences between social exclusion through
housing and social exclusion from housing (2
points) - Exclusion from housing focuses on unmet housing
demands while exclusion through housing focuses
the shift outwards the impact of housing on
broader societal participation.
25Exam answers - Question 4
- The definition of spatial segregation (3 points)
- Spatial segregation Spatial effect of social
exclusion. - The term social location (2 points)
- Social location Through housing, ones
residential location and with that access to
other services than housing is determined.
26Exam answers - Question 4
- A description with examples- of
neighbourhoodism (4 points). - Neighbourhoodism is a diminished access to
services such as food deliveries, taxis, home
insurance, housing elsewhere due to the
reputation of the neighbourhood where individuals
reside.
27Exam answers - Question 4
- How the spatial assimilation model aims to solve
spatial segregation issues and why its
applicability, in cases of neighbourhoodism, is
limited (5 points). - The spatial assimilation model assumes that
newcomers start at the bottom of the
socio-economic ladder. Once their socio-economic
status improves, they will leave their initial
neighbourhoods and start a cultural assimilation
process. Cultural assimilation process does not
account for limited possibilities of doing so by
discrimination. Neighbourhoodism is one form of
discrimination housing distributors may be
biased about neighbourhoods with a certain
reputation, limiting individuals opportunity
structure.
28Exam answers - Question 5
- Match and explain
- Landlords
- Mortgage lenders
- Real-estate agents
- Planners
- Residents X
- Steering
- Family-based planning X
- Discrimination
- Gender-based planning X
- Redlining
Items marked with X do not have to be considered.
(One of both at the right side must be considered
though 1 point each)
29Exam answers - Question 5
- Match (1 point each) and explain (2 points each,
total of 12 points) - Steering Real-estate agents may direct certain
buyers/ renters to certain areas (bias) - Family-based planning Planners often design
types of neighbourhoods based on a nuclear
familys needs while nowadays one-person
households and households without children are
increasing - Discrimination Putting up barriers for or
denying access to groups of people based on
certain characteristics - Gender-based planning Planners often design
types of neighbourhoods based on a nuclear
familys needs while nowadays single women
increasingly run their own household - Redlining Refusal to provide loans/ mortgages
for objects in low-income neighbourhoods or
neighbourhoods with poor housing conditions
30Exam answers - Question 5
- Explain
- Social class hypothesis (4 points)
- Social class hypothesis assumes that all spatial
segregation can be explained by socio-economic
characteristics
31Exam answers - Question 5
- Explain
- How government policy of multiculturalism may
lead to social exclusion (4 points) - Multiculturalism may lead to social exclusion if
sufficient access to language books and
newspapers decreases literacy and English
proficiency among second (or more) generation
immigrants.
32Exam answers - Question 5
- Explain
- What the ethnic enclave model is based on (2
points) - The Ethnic Enclave Model is based on the notion
that bonding with the own (ethnic) community does
not necessarily weaken in the course of time.
Spatial assimilation (acculturation) therefore is
not necessarily a goal for ethnic groups, despite
increased wealth/ higher income/ greater social
mobility.
33Exam answers - Question 5
- What chain immigration is (1 point)
- Immigrants chose to live near their previously
established immigrant friends and relatives
resulting in a process named chain immigration.
34Exam answers - Question 5
- Explain
- How researchers who adopted the ethnic enclave
theory would feel about the criticism on
multiculturalism (2 points) - Ethnic Enclave researchers will stress the
advantages of threshold populations for not only
language newspapers, but also for specialized
products, churches and opportunities in ethnic
entrepreneurship (often within the home). - ANY QUESTIONS ABOUT THE MIDTERM?
35Neighbourhood transitions
- Aging of real estate
- Changing values of housing as a consequence of
neighbourhood transitions - Depreciation
- Declining housing quality
- Mismatches between housing and households
- Filtering downward or upward
- Residential relocations
- Changing composition of households
- Changing quality of housing and neighbourhoods
36Introduction to neighbourhood transitions
- Mechanisms of change
- Upward/ downward changes
- Theories/ concepts
- Effects of revitalization
- Literature
37Neighbourhood transitions
- When prices are low, some inner city environments
are prone to gentrification - Improvement in quality housing and neighbourhood
- Services may change (daily necessities get
crowded out by trendy shops, restaurants and
branches) - Reduction in the availability of low cost housing
- Ultimately social polarization and displacement?
38Six major processes of change on the housing
market
- Occupancy turnover and the movements of
households within the housing stock - Filtering process and changes in housing quality
- Housing and neighbourhood change arbitrage
- Progression of housing vacancies through the
stock (vacancy chains) - Spatial variations in house price changes
- Revitalization and the return-to-the-city
movement gentrification - (Bourne, 1981)
39Households move through the housing stock
- Matching of households and housing
- Incomes and house prices act as the broad
constraints on the likely behaviour of households
and their occupancy of the housing stock - Most moves within same tenure, but there is
movement between segments, from private rental to
owner-occupied - Changes within housing stock (conversion)
- Simplified Cheap, small rental housing in CBD
and expensive large owner-occupied housing on the
edge of the city
40Filtering
- Any change in the relative position of the
housing unit or the household in the inventory,
or matrix, of housing units in the area
filtering up and filtering down - History concept Innermost rings in the city were
occupied by a succession of social groups of
decreasing income. - Each zone filtered down over time.
41Filtering
- Based on specific assumptions from the ecological
literature - Demand for housing related to income (newer and
more accessible) - Housing depreciates with age, reducing the flow
of housing services - Encouraging those with sufficient income to
relocate - New construction is necessary and stimulating for
filtering - Welfare component housing could filter down to
lower income groups, improving their housing
quality - Park, 1925 Hoyt, 1939 Ratcliffe, 1949
42Filtering
- Filtering up only occurs when price declines more
rapidly than housing quality (Grigsby, 1963) - Filtering up only occurs when the change is to a
more preferred bundle of housing services (Leven,
1976) - Households can undergo filtering without moving
passive filtering - Households can undergo filtering by relocating
active filtering - Filtering recognizes the importance of external
factors in determining housing conditions - Filtering incorporated consumer preferences and
expectations about housing services
43Types of filtering
- Changes in supply
- Changes in the position of households
- Changes in the matching of households and housing
- Changes in household welfare
44Filtering and policy
- Policy thinking if rate of new construction is
faster than the rate of filtering downward, most
lower-income households will be able to improve
housing - Lacks regard for distribution by price and
quality - Justifies construction of middle- and
upper-income housing - Assumption New housing will exceed household
formation and real incomes will rise
45Criticism for filtering
- Housing of reasonable quality does not filter
down and thus does not become available to
lower-income groups - Other reasons of unavailability
- Conversion to other uses or other forms of
tenure, often for investment purposes - Demolishment for roads, redevelopment, or parking
- Even if housing filters down, there is lack of
mortgage availability, high rents,
discrimination, and a low housing quality - Filtering may not be an efficient or humane way
of providing housing
46Arbitrage model of neighbourhood change
- A more recent version on filtering
- Placed central are the conditions and mechanisms
that move boundaries between neighbourhoods of
different socio-economic status and ethnic
differences in an unstable housing market - This approach unites elements of neighbourhood
change with sub-market interrelationships,
filtering and housing preferences - Differs from filtering direct response to
changes in preferences - Leven, 1976 Little 1976
47Arbitrage model
- Mismatch of supply and demand
- Shift of boundaries between neighbourhoods
- Self-generating (self-fulfilling expectations of
transitions) - Access to housing by higher-income groups
- New housing realized outside neighbourhood
- Assumption people want to live with similar
people
48Arbitrage model
- As boundaries shift, house prices differentiate
according to four levels - Centre of high status area
- Near boundary of low status area, in high status
area (locational discount) - Near boundary of high status, in lower status
area (premium) - Centre of lower status
- Demand influences prices and moves boundaries
49Arbitrage model
- The direction in which a boundary shifts is
dependent on which group exercises the largest
demand on housing - If this is a low income group higher-income
groups may be blown out by the demand, leading
to a continued deterioration of the housing stock - This is the core of the process of arbitrage
- Higher income households perceive a future
decline in housing services through neighbourhood
transitions - They seek to move out to newer housing
50Arbitrage model
- Lower income households can not exercise that
much choice - Shrinking demand because of deterioration,
demolition and abandonment - Only profitable market alternative conversion
(e.g. multi-family) arbitrage - Discounted housing leads to lack of maintenance
and physical deterioration
51Arbitrage model and non-residents
- Institutional lenders reinforce expectations of
neighbourhood change by withdrawing investments,
refusing loans, or demanding higher down payments - Speculators may purchase housing but want a quick
return which further accelerates under-investment
and deterioration
52Vacancy Chains
- Perspective related to filtering
- Directly links housing units involved in
household relocations - Tricky to understand because, like housing
careers and Markov Chains, they do not focus on
households but on vacancy that is being
displaced with every step (the moves thus go in
the opposite direction)
53Example hermit crabs
54Vacancy Chains
- Vacancy chains are short because of diversity in
the housing stock and because of the weakness of
the method - Especially short when there are a lot of new
households and in-migrants, and where demolitions
take place, chains are shorter when new public
sector housing is constructed - No or few homes are left behind in such cases
55Criticism on vacancy chains
- Links imply causal linkage that may not be
existent (households do not know each other, no
common denominator) - Unsuitable for measuring if quality of housing
for the poor is improved by filtering because the
poor seldom appear in such chains, except when
social housing is constructed - Descriptive index on the aggregate level
- Insight into turnover generated by new
construction
56Spatial variations in house prices
- Price most common index of housing market
performance - Four sets of factors that determine price
- Structural characteristics of the house
- Neighbourhood characteristics (phys soc)
- Location (accessibility)
- Institutional behaviour (fin. real est. agents)
57Stuctural characteristics of the house
- Size/ Floor area
- Lot size
- Number of rooms
- Level of improvements
- Garage
- Air Conditioning
58Neighbourhood characteristics
- Physically attractive/ scenic
- Pollution
- Higher-income neighbours
59Location
- Accessibility CBD (Hoyt, 1939)
- Multi-centred city many work locations
- Not the most important characteristic anymore,
but there are still some signs of it
60Hedonic price estimation
- House value hard to determine sometimes
- Not many comparable units
- Individuals may value characteristics differently
- Solution hedonic price estimation, which is the
result of multiple regression of housing
characteristics
61Return-to-the-city
- Return-to-the-city movement since the 1970s, even
though trend has always shifted between high- and
low-income areas - Suburban middle- and higher-income households
- Many labels revitalization, gentrification,
white-painting
62Revitalization
- Improvement in housing and neighbourhood quality,
combined with increase of average income - Private action, individual or corporation action
- Quasi public housing associations, self-help
groups, direct public grants action - Streets or single houses
- Usually within fixed distance of CBD ( 3 km)
63Gentrification
- The investment of urban space for the use of a
more affluent clientele (Hackworth Rekers) - More explicit class connotation than
revitalization - Traditional working class neighbourhoods are
invaded by middle and upper income groups
(Hamnett, 1973)
64The Usual Areas
- Historic and attractive central area
- High proportion of professional occupations/
offices - Tight housing market
- Older housing with architectural merit
- Inner city amenities (parks, cultural
institutions, etc.) - Absence of ethnic strife
- Relative difficulties in commuting from suburbs
65The Usual Circumstances
- Demographic shifts (dink, smaller families)
- Employment (dual income) Disposable income and
share to spend on housing has increased - Costs suburban housing has increased since the
1970s, while costs of commuting increased - Shifts in tastes and housing preferences
66Image branding/ packaging
- Developers can do a lot to create an image for a
neighbourhood - Financial institutions have influence by
expediting transitions by extending mortgages to
in-areas - Ethnic packaging
- Ethnic commercial strips are marketable branding
mechanisms, intended or not
67Ethnic packaging
- Mistaken identities of areas such as Little Italy
- Only 10 of population Italian by mother tongue,
even less by place of birth or spoken language - Dissonance between cultural and commercial
identities - Since the 1980s and 1990s there is a recognition
for the importance of culture - Complication sometimes culture is produced by
economic interests, not autonomous
68Dualism between culture approach and economic
approach
- Culture approach gentrification is the spatial
expression of a critical class politics - Consumer dominance
- Neighbourhoods gentrify because of changing
tastes and preferences - Rejection of the suburbs because of the distance
to work, isolation, and lack of diversity - Cultural humanism as dominant influence humans
have a certain degree of decision-making
autonomy, and are not easily predictable (Ley,
Caulfield)
69Dualism between culture approach and economic
approach
- Economics placed central gentrification is
caused by the availability of inexpensive real
estate. - Rent gap theory many neighbourhoods experienced
disinvestment in inner-city, leading to a decline
in potential rent (highest and best use) - Gentrification takes place where the potential
rent is far above the actual rent ? supply and
concentration of devalorized land is necessary - Gentrification is facilitated by developers and
governments - Marxian economics is the primary influence
- Smith/ Badcock/ Clark
70Dualism between culture approach and economic
approach
- The early 1990s recession brought an end to large
scale gentrification, seemingly supporting the
culture hypothesis - Note Demographics pointed in the direction of
there being more people that would be interested
in living in the suburbs at that time (maturing
families) - Two sides of the same coin, rather than a
polarity of culture and economics - Dualism is only problematic if ethnic identity
may be marketed to sell real estate, because it
draws the attention away from the way cultural
amenities are strategically produced
71Toronto examples
- Some areas have historical cultural identity, and
some dont - Little Italy has an Italian history, but there
has been a shift since the 1970s in the type of
economy and population from traditional and
family orientated to trendy, the ethnic swoosh is
all that remained of the original Little Italy - College degree went up from 2.5 in 1971 to 32.5
in 2001
72Toronto examples
- A history of many identities Greektown on the
Danforth (Cuban, Afghani, Japanese, Greek) - Gentrification changed the economy, the
population and housing - House value and rent higher than for metropolitan
area as a whole, exclusion of everyone except
upwardly mobile young professionals - More self-conscious promotion has led to a less
trendy area than Little Italy, but still a
happening place - Chains moved in
73Branches moving into gentrified areas
74Toronto examples
- Corso Italia/ St. Clair area
- Some Italian history, though more recent than
Little Italy - Fashionable and high end, geographically and
culturally isolated from rest of downtown, less
tourist oriented - The feel remains more working class and more
Italian than yup, even though there are early
signs of gentrification
75Toronto examples
- Gerard India Bazaar
- Interestingly, no ethnic history except for a
Hindi movie theatre (Bollywood productions) that
drew in the East-Indian crowd from all over the
GTA - Entrepreneurs noticed the interest and started
opening business but the residential identity was
never parallelled - Many immigrants, mostly Chinese
- Values of rent are below the metropolitan level
and fluctuate considerably - Incomes have declined in this area
76Culture/ Economy
- Inclusion of culture seems analytically helpful
for the study of cities - Reproduction of ethnicity for consumption is
rarely to promote displacement of residents - Instead it attracts YUPs, whose activities are
government supported (all levels of government)
77Consequences of revitalization
- Physical improvement of housing stock in the area
- Physical improvement of neighbourhood
- Higher prices and rents
- Reduces inventory of low-cost housing
- Dislodgement of original residents
- Social fabric of neighbourhood decreases
- Demand for local services (daily grocery
shopping, schools) changes - Land use densities and patterns
- Not necessarily bad or good
78Literature for this session
- Hackworth, J. J. Rekers (2005), Ethnic
packaging and gentrification. The case of four
neighbourhoods in Toronto. Urban Affairs Review
41/2, pp. 211-236. - Slater, T. (2005), Gentrification in Canadas
cities. In R. Atkinson and G. Bridge (eds),
Gentrification in a global context the new urban
colonialism, Chapter 3. London/ New York
Routledge, pp. 39-56. - Smith, N. (1987), Gentrification and the rent
gap. Annals of the Association of American
Geographers, 77/3, pp. 462-465.