Re: [UC] Pricing people out

[Anthony West]

Brian wrote: > Yes, property owners > can now draw on greater equity for improvements, and this applies to > investment-property owners as well. But when landlords use this > greater equity to improve their properties, it generally leads to an > increase in the going rental costs of neighborhoods. And that's where > the impact is hardest and most immediate: among renters. > I know several people who couldn't keep up with the rent increases > that have happened over the past six years, and who've had to move > further west and south. I'm sure than many of us know people who've > been through this as well. In general, I think the Penn plan's helped the > area, but let's not ignore this considerable and very real downside. Pushing old renters out distresses me when I think of my many renter friends; as a property owner, though, it's fine with me -- UNLESS it has a deleterious impact on the overall livability and marketability of the neighborhood. Which I worry that it may.   Face it: the quality of life in University City depends heavily on the quality of renters that we have, because they dominate the streets. Now, the middle-class rental market for this area is not infinite and it is highly particular. In other words, a random cross-section of middle-income renters scattered across the metropolitan area would NOT want our middle-income apartments, not for all the tea in China. Our primary appeal is to students and to lower-rung university staffers.   Whose housing budget is notoriously inelastic. They don't want to live in a slum necessarily, but they can only afford so much. When pressed beyond their limit, they will vote with their feet.   It happened once before. Anybody remember 1989? The last time a real estate bubble burst? The last time the inner-city job market went south? The last time a crime epidemic swept through West Philadelphia? Rentals had run up smartly during the '80s. All of a sudden, students decided they couldn't afford U.C. Rocked by the same downturn, Center City suddenly had vacancies for apartments previously occupied by IT whizzes and middle-management bankers. Center City landlords responded with nimble pricing moves. With a giant sucking sound, the students disappeared to charming, newly affordable Rittenhouse Square. Guess who took their places? Not the IT whizzes and middle-management bankers.... So on that occasion, pushing average rents too high drove the neighborhood down, not up.   I am permanently leery of any planning for University City that assumes things can only get better around here. In my view it is an inherently marginal middle-class community, that is healthiest when it accepts the specialized needs of life on the margin. And one of those needs is never to price out its students.   -- Tony West