Gentrification: a general term for the arrival of wealthier people in an existing urban district, a related increase in rents and property values, and changes in the district’s character and culture. The term is often used negatively, suggesting the displacement of poor communities by rich outsiders.
Every year the National Low Income Housing Coalition puts out figures that relate to housing and wages, that is the wage a person must earn to afford rentals in communities across the country.
The report, called “Out of Reach” is appropriately titled. For at least the last 20 years, the crisis of unaffordable housing has been growing so that even renters with adequate jobs who think of themselves as middle class are finding themselves in trouble, and low income and extremely low-income renters are forced out onto the streets.
About this displacement, the Sacramento Housing Alliance says “our neighbors, friends and loved ones are making decisions that no one should ever have to make to pay rent—like going without medical and dental care, nutritional foods and adequate child care.
So when is a rental house/apartment considered affordable? Most guidelines say:
a. When an individual or family can pay for it out of their monthly income and still have enough money left for food, clothing, transportation and health care.
b. When the rent and utilities cost no more than 30 percent of the household income. However, this means that a family of four with two working parents earning the minimum wage can only afford $700 in rent or mortgage payment and utilities.
Sacramento’s growing population is creating a demand for rental housing that is not being met. Rents are rising. What was a short time ago an average of $1,021 for a two-bedroom apartment has popped up to around $1,369 a month, according to the online real estate data base Zillow.com. Senior citizens on social security, people receiving unemployment insurance and people with disabilities receiving SSI are but a few of the population who are staring impossible rents in the face.
It is looking grim even for working families. If you take the recent statistic of what was considered fair market rent in Sacramento ($1,021 for a two-bedroom apartment), the affordable rent and utilities without paying more than 30 percent of income on housing, a household must earn an annual salary of $40,840. In California the minimum wage workers earns $8 an hour. To afford the fair market rental for two bedrooms, a minimum wage earner must work 100 hours a week for 52 weeks a year.
Compounding the unavailability problem is Sacramento County’s recent decision to change an ordinance that required developers to include housing for low income and extremely low income people to be built in their future developments. Now developers pay fees into a housing trust for poor people en lieu of building more affordable housing.
And, it looks as though the city will soon enact a similar ordinance revision.
Carol White, a social worker with Family Promise of Sacramento, says families she sees are recently displaced and homeless predominantly because either their landlord has decided to sell their dwelling and has evicted them, or they have been living with others who then move out and they cannot make the rent.
“When you have been evicted from other places, it a big problem in terms of renting anything else. Most of the families we see all seem to have one or two evictions of this nature,” White says.
Family Promise is a non-profit group of approximately 13 Sacramento area church congregations who rotate hosting families at night in their churches and feeding them a warm dinner. During the day, they provide a center in the Loaves and Fishes complex to help them find housing and solutions to problems blocking permanent independence.
Director of the Sacramento Housing Alliance Darryl Rutherford says the calls to his office from desperate people who are finding it impossible to rent a place to live are increasing. “Rents are what the market will bear. Couple this with the low minimum wage, housing is getting out of reach for a lot of people,” he says. The median rent in Sacramento has increased 13 percent over the past year, he says.
Another issue is the proposed development for Sacramento’s downtown area, Rutherford says. “Soon it will be catering to the few elite and ultimately shove the working poor out to the fringes.”
He says people will either move to where they can afford to rent or make do somehow. He is hearing of families doubling and tripling up in rentals and still having a hard time making ends meet.
Rutherford says that with the gentrification of downtown, a lot of small businesses that are not included in the economic development plan will be displaced as well. “Sacramento is definitely not going to meet its goals for sustainability. One can appreciate the focus on redevelopment of downtown but it should be with a minimum impact on the people there.
“You lose a lot of the fiber of the community, all the social connections of the neighborhood, when you drive people out to create condos, boutique hotels (as is the case of the Marshall Hotel on 7th Street which has been a 90-room single room occupancy hotel for low income people) and large hotels.”
“People are not seeing the larger picture in the need for affordable housing. They think it is for ‘those people’—the homeless or extremely poor. They do not think about themselves as being low income. If only more people would understand that we are fighting for the working class.”
A recent article in the Sacramento Bee quoted neighbors of the Loaves & Fishes’ Friendship Park area, where there are plans to expand homeless care facilities, as saying they were afraid that more people will be drawn to their part of Sacramento and cause sanitation and petty crime problems. But with the rapid displacement of people from ever more expensive places to live, a surge in homeless, near homeless, poor, and low income workers searching for cheaper housing is already a fait accompli.
Director of Counseling Programs Tommi Avicolli Mecca at the Housing Rights Commission of San Francisco says right now that city is seeing an epidemic of evictions in working class neighborhoods. “There is a mass exodus of poor and working class people. They are being forced to leave the city or become homeless.”
He says real estate speculators are coming from around the world and availing themselves of the Ellis Act to buy cheap rent control buildings, then evicting tenants. The Ellis Act provides loopholes for landlords in selling their buildings and circumventing municipal rent control provisions like San Francisco’s.
Avicolli Mecca says the new landlords typically divide up or re-rent the spaces for an astronomical fee. “Then we are seeing lots of condos being built. There is a need for affordable housing but the city is not paying attention here either.
“So now you have SROs turned into Air B&Bs or tourist rooms sold for tons of money by the night. We are no longer housing poor people in SROs.
“I live in a city that is supposed to be filled with the most compassionate, understanding and caring people in the world, I see a constant abuse of the homeless and displacement of the working class. Plus we are losing diversity. The African American population is down from 21 to 6 percent and Latinos and LGBT people are being pushed out of the Mission, particularly young people. The Castro is losing older gay men, some of whom have AIDS. Upscale tech types are moving into all these neighborhoods.”
Avicolli Mecca calls San Francisco “a war zone” with working class and strong communities being pushed out. “We are becoming a city of the rich.”
And the poor are going elsewhere. A flood of displaced people coming to the Sacramento area certainly is imminent if people do comparative shopping. A family in the San Francisco Mission’s upscaled buildings will have to earn $30,000 a month to afford their $10,000 a month apartment. In the Castro, the rents for newcomers will soon go as high as $8,500 a month.
“If San Francisco is not dealing with these problems in a caring and compassionate way, I don’t know how anyone can,” he says.
Nationally, says Out of Reach, the 2014 two-bedroom housing wage was $18.92, more than two and a half times the federal minimum wage, and 52 percent higher than it was in 2000. In no state can a full-time minimum wage worker afford a one-bedroom or a two-bedroom rental at Housing and Urban Development-estimated fair market rent.
In December, the National Low Income Housing Coalition urged policy-makers to raise the federal minimum wage and combat income inequality. They also have pushed for funding of the National Housing Trust Fund to build, preserve and rehabilitate rental homes that are affordable for extremely low and very low-income households. “The shortage of affordable housing must be addressed. Expanding the supply of affordable rental homes dedicated to the lowest income renters is a critical and fundamental part of any real solution,“ says the coalition.
“In both rural and urban America, renters are affected by the affordable housing shortage and rents are expected to continue to rise in coming years as the demand grows. Over half of all renters (53 percent) are cost burdened, paying over 30 percent of their income for housing, up from 12 percent” a decade ago.
“The lack of decent housing affordable to low income households has remained a pervasive national issue for over 25 years, affecting every single community across the United States.”