Re: Pioneering/Building in Disadvantaged Neighborhoods/Gentrification
From: dlmandel (
Date: Sun, 5 Apr 2009 23:34:44 -0700 (PDT)
We built in 1993-94, during the previous housing market depression -- nowhere 
near the scope of the current one, but some of our experiences may be 
instructive. And the site we acquired was in a low-income, rather run-down 
urban neighborhood. Here are a few brief observations, some tangentially 
related to your question:
1. It was a huge challenge that the best numbers we could wring out of a 
friendly appraiser were lower than our construction costs. (For building 
purposes, we were our own developer, so we had to cover them somehow.)
2. This caused us to skimp more than we wanted on materials (for which we're 
paying today, with more rotting trim than there should be), extra common space 
wishes and reserves. Most of us never got the full promised (modest) return on 
our early investment. (That our builder filed for bankruptcy before paying us 
some money he owed didn't help either.)
3. That we got it built was (among other things) thanks to the fact that we 
were in a targeted "redevelopment area," so the housing authority was able to 
use tax increment funds to make small "appraisal gap" loans to each buyer that 
are due only upon sale or cash-out refinance. 
4. Low and moderate income people qualified for silent second "affordability" 
loans that enabled them to join us.
5. And geography made the rest eligible for decent state Housing Finance Agency 
loans, which otherwise carried limited income eligibility and/or first time 
buyer restrictions. 
6.  We were concerned from the start about gentrification, and our arrival 
caused some tensions (abetted by misinformation) early on
with longtime residents who saw it becoming less and less likely that
their kids could afford to live in the neighborhood. 
7. Our concern was mixed. When housing is an "investment" as well as a home, 
self-interest sometimes pulls people in the opposite direction, and our 
benefactors in the housing authority certainly seemed to consider 
gentrification a good thing. Some of us were very disappointed that they were 
undermotivated to enforce contracts to maintain even the minimal affordability 
that was supposed to last for 30 years for the six "low-income" units. 
8. While the area is still a mix of new, upscale houses, dilapidated older ones 
and low-rent apartments, subsequent years saw a huge increase in the 
desirability of living in the city's central core, of which we are a part. We 
were, in a sense, pioneers who accelerated the trent, but our role was just a 
small part. Measured as a rise in property values, gentrification occurred 
around us -- tempered in the past year, of course, but prices are still a lot 
higher than when we built.
9. As an advocate of affordability, I'm much more skeptical now of the 
arrangements we tried so hard to put in place. If you seriously want to 
maintain affordability and avoid contributing to gentrification, find 
mechanisms outside the market that keep housing from being just another 
commodity. Community land trusts can maintain affordability in perpetuity, as 
can limited equity co-ops. Work with established nonprofit housing developers 
to use these tools if you can. And work for a society in which they'll become 
the rule, not the incredibly difficult exception.
David Mandel
Southside Park Cohousing, Sacramento

--- On Sun, 4/5/09, David Heimann <heimann [at]> wrote:
From: David Heimann <heimann [at]>
Subject: [C-L]_ Pioneering/Building in Disadvantaged 
To: cohousing-l [at]
Date: Sunday, April 5, 2009, 2:08 PM

On Fri, 3 Apr 2009 cohousing-l-request [at] wrote:

> Date: Wed, 1 Apr 2009 21:38:33 GMT
> From: "Cora Roelofs" <corar2000 [at]>
> Subject: [C-L]_ Pioneering/Building in Disadvantaged
>       Neighborhoods/Gentrification
> To: cohousing-l [at]
> Message-ID: <20090401.173833.17281.0 [at]>
> Content-Type: text/plain; charset=windows-1252
> We're in the site search and working with a development partner. I was
wondering about any experiences related to developing cohousing in economically
disadvantaged neighborhoods.
> I know that Swan's Market played a role in the re-development of
downtown Oakland and I'm curious about others' experience with their
site selection process and predicting the future of a neighborhood without high
housing prices. There are lots of comments that could be brought out about the
social issues, but I'm specifically interested in the development and
economic issues. And perhaps leaving aside the current crazy real estate
situtation. Specifically, can we sell units for what they cost to build in a
place where housing prices for other types of housing (even nice housing) are
relatively low?  Won't the bank look at our housing prices and compare them
to "comparable" units in the area and find them too high? Won't
prospective cohousers do the same? This is even if we get cheap land, since
construction costs seem still to be high.
> I guess I'd be interested in general comments as well about cohousers
"moving in" to poor neighborhoods where most of the cohousers are not
poor themselves. And I'm thinking this is a gentrification question as well
-- the upsides and the downsides of increasing the average value of housing in a
poor neighborhood.
> Cora
> Stony Brook Cohousing
> forming and search in and around Jamaica Plain, MA
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