Finding affordable rental housing in Philadelphia gentrifying neighborhoods has become a major challenge.
Researchers at the Federal Reserve Bank of Philadelphia recently released a report finding that city lost about a fifth of its low-cost housing units between 2000 and 2014.
The losses occurred in gentrifying neighborhoods at more than five times the rate of non-gentrifying areas.
The report lists University City, the area of Thomas Jefferson University Hospital and Holmesburg as the sections that experienced the greatest loss of affordable housing.
Using U.S. Census data, researchers found that the city lost more than 23,000 rental units with an average monthly rent of $750.
The median household income of Philadelphia renters in 2014 was $28,726, while the average citywide rent was $936.
“Philadelphia loss of low-cost rental units would be less concerning if households experienced a corresponding increase in income, allowing them to afford more expensive units,” the researchers wrote.
“But the incomes of renters in Philadelphia have not kept pace with rising rents.”
The report notes that city median gross rent increased by nearly 20 percent between 2000 and 2014, the median renter income fell by two percent.
“One of the things that this report captures is how much the rental affordability landscape has really changed for the typical Philadelphia renter,” said Eileen Divringi, community development research analyst, Federal Reserve Bank of Philadelphia.
Many low-income residents are able to tap into subsidized housing, however the report notes that 20 percent of the city’s 37,369 government subsidized units are expected to see their affordability restriction periods expire within the next five years.
“There are roughly 1,000 units that are located in gentrifying neighborhoods and owned by for-profit entities and they may have more of an incentive to convert those to market rate when the affordable restriction expires,” Divringi explained.
The study indicates the rising housing prices in gentrifying areas are not only fueled by new construction but are also driven by the loss of low-cost housing.
“Part of the reason we do this research is we want to understand the opportunities and the challenges that gentrification presents from an economic inclusion standpoint,” Divringi added.
“Understanding the accessibility of these neighborhoods as they become opportunity rich is important to us.”
Nora Lichtash, executive director of the Women’s Community Revitalization Project, said the lack of affordable housing is a serious problem in Philadelphia as property values drastically increase.
“Property values have really increased so there are many neighborhoods where people need affordable housing but affordable housing is disappearing in those neighborhoods and the people who are pushed out first are renters,” Lichtash said.
“It’s no coincidence because of racism that its poor people of color. The people who are hurt the most are regular families … individuals who are just getting by.”
WCRP is part of the Philadelphia Coalition of Affordable Communities, which is calling on City Council to pass legislation which would impose a housing impact fee on developers building market rate homes to raise money for affordable housing.
“Based on the current economy that would bring in about $12 million a year and that could go a far way to ensure that we preserve these affordable homes,” Lichtash said.