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Gentrification and Displacement of Urban Areas in Miami, Florida Term Paper

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Updated: Jul 20th, 2021

Introduction

The concept of gentrification denotes the development of urban areas through the arrival of wealthier people from other regions. The process of gentrification usually takes a short period that is characterized by the inflation of property prices as well as the displacement of original inhabitants. In most cases, prosperous outsiders displace poor communities living in targeted urban areas, a situation that has a negative impact on the well-being of original residents.

For instance, individuals who previously owned the land before the entry of new people have to cope with issues that range from high standards of living and joblessness to cultural interferences. However, gentrification has its pros. For instance, it is attributed to the transformation of an area’s economy since it facilitates the development of higher-income households in a region that formerly consisted of lower-income residents.

Gentrification presents complex consequences, which require the establishment of strategies, including advocacy initiatives, remaining in one’s region through vitalization, and communication programs, which aim at facilitating interactions among outsiders and residents. This paper finds it crucial to understand its implications on contemporary urban society, particularly Miami, Florida.

Why/How Gentrification Happens and Who Benefits

A few cities have emerged since World War II. These metropolitans have focused on developing urban neighborhoods characterized by a relatively low cost of living. However, preventing the entry of individuals into new regions has been inevitable. The process of gentrification occurs in the form of accretion where growth is reported gradually before it gains momentum within a short period (Lees, Slater, & Wyly, 2007).

According to Ding, Hwang, and Divringi (2016), gentrification is much common in the United States due to people’s increasing interest in city life. Initially, few outsiders were enthusiastic to settle in unfamiliar neighborhoods characterized by class as well as racial differences. However, the arrival of more people in various neighborhoods or cities gradually occurred, with a group of related individuals occupying specific regions (Ding et al., 2016). As Lees et al. (2007) reveal, rapid changes eventually take place in these areas following reports that an attractive neighborhood has been identified as being conducive for business and residential purposes among other reasons.

The happening of gentrification may be compared to the act of a snowball gaining momentum. In the current context, previously unattractive settings attract rich outsiders whose statuses result in considerable changes in demographics, real estate markets, land use, and culture. As more people arrive, further developments are witnessed in areas that surround gentrified neighborhoods. Notable outcomes that follow the gentrification of a given place include the growth of infrastructure and the improvement of community resource centers (Ding et al., 2016).

Consequently, gentrification not only increases the value of material goods but also augments economic activities. As such, local governments collect more revenue from assets that gained price. They also benefit from increased economic transactions whose turnover bolsters economic growth.

Outsiders, mostly rich people entering a neighborhood, are often the beneficiaries of the process of gentrification. According to Lees et al. (2007), affluent individuals arriving at a formerly undesired neighborhood take advantage of the available cheap housing and industrial buildings, which they easily acquire before converting them into appealing homes and business premises. The higher-income status of incoming individuals allows them to capitalize on the low-value property and hence the reason their activities end up flourishing.

Nonetheless, Ding et al. (2016) reveal the extent to which gentrification benefits the rich at the expense of the original and poor residents who are relocated, despite having inhabited their regions for several generations. Overall, wealthy people have little to lose in the process of gentrification in most urban neighborhoods compared to lower-income earners who originally resided in the affected areas before the arrival of outsiders.

Who is Displaced and Why Does Displacement Happen?

As earlier mentioned, the process of gentrification triggers the displacement of the original residents of a particular neighborhood that undergoes rapid changes in terms of demographics, real estate landscape, land use, and civilization (Hwang & Sampson, 2014).

Original residents of districts or areas that are subjected to gentrification are usually deprived financially. Higher-income earners who enter these neighborhoods are perceived to have a significant potential for growth prompt changes that make it difficult for locals to manage (Shaw & Hagemans, 2015). Competition for the scarce supply of housing between the affluent class and poor locals causes inflation in the form of increased rents and property prices. Consequently, lower-income households in the neighborhood find it difficult to survive in a region that lacks adequate and affordable housing due to the arrival of rich outsiders.

In addition to the housing supply shortage arising from gentrification that triggers the displacement of local people in a given neighborhood, the establishment of new businesses by outsiders is also a factor for consideration as far as displacement is concerned. As Lees et al. (2007) reveal, within a short period after settling in an area that was formerly considered unattractive, outsiders bring about economic changes that drive the value of key assets upwards.

Consequently, long-existing local family-owned firms are replaced by new retail enterprises such as clothing stores, coffee shops, and art galleries among other businesses. A study by Ding et al. (2016) identifies poor African-Americans and Latin-Americans as the most vulnerable population, especially when gentrification takes a racial dimension. As such, the competition brought about by affluent outsiders influences the exit of locals since they find the changing economic atmosphere unfriendly.

As Hwang and Sampson (2014) observe, the new face of business created by the gentry in a particular urban setting pushes the prices of products and services upwards, thus prompting lower-income families to relocate. In most cases, original inhabitants of a neighborhood that undergoes gentrification experience inflation that follows due to the arrival of outsiders, a situation that strains the revenue of working-class families, thereby undermining their ability to pay for rent and other goods and services (Ding et al., 2016). As a result, poor local dwellers in a particular area end up relocating in search of affordable housing and livelihood.

Cost of Living Increases

Gentrification is linked to an increased cost of living since the entry of outsiders influences economic changes. Miami, Florida, is one of the most expensive places to live in the U.S. due to the continued arrival of rich outsiders. Regarding the cost of living measurements, out of 100 metropolitan cities, Miami is at position 41 of the most luxurious cities to live in America. On average, the annual cost of living in this region is projected to be almost $85,000 for a family of four, which is a 20% increase compared to the status reported five years ago (Wile, 2018). This figure is considerably higher in relation to other cosmopolitan areas in the U.S. The high cost of living in Miami is attributed to expensive house rents, utilities, food, and transportation.

Housing prices in Miami vary from one neighborhood to another due to racial and social class differences existing in this city. Areas in Miami with typical sky-high rents include Coconut Grove, Brickell, and South Beach whereas regions such as Liberty City and Overtown are characterized by low rents and high insecurity incidences. As a result, people seeking to reside in safe places within Miami have been pushed to neighborhoods associated with high rents.

According to Mcavoy (2018), year-over-year changes in accommodation rates and rents in Miami have been 1.39% and 2.385, correspondingly. Additionally, this city recorded a 1.76% average change in consumer price index (CPI) for the period between 2014 and 2017 (Mcavoy, 2018). Variations in home value, rent, and CPI are considerable, a situation that depicts standards of living in Miami as not fit for lower-income earners.

Costs associated with utilities, food, and transportation mechanisms have been on the rise in Miami because of the arrival of wealthy individuals over the past few years. In 2018, the average cost of utilities in Miami is projected to be $150 per month for 1,000 square-foot public housing whose average rent stands at $1,819 for the same period (DePersio, 2018). In this regard, working-class families earning less than $1,500 monthly find it unbearable to cope with the high cost of utility bills and rental fees. Furthermore, as DePersio (2018) uncovers, the average price of food per week in Miami is $100 whereas unlimited monthly bus transportation averages $113.

In this view, the cost of living in this city’s various urban settings is relatively high when compared to suburban areas. Nonetheless, according to Mcavoy (2018), the emergence of climate gentrification in Miami is perceived to lead to rapidly rising prices of key products and services. In this concern, gentrification poses adverse effects denoted by a higher cost of living, which forces lower-income households to relocate to neighborhoods with affordable living standards.

Property Value Increases

The onset of gentrification in Miami in the recent past has been associated with subsequent upsurges in the cost of property, especially residential and industrial assets. According to Mcavoy (2018), homes have recorded a 1.39% year-over-year change in value, which is a considerably higher rate in a city that is characterized by significant racial and income disparities. Over a period of five years, the median sales price for properties in Miami has gone up substantially as shown in Figure 1 below.

The median sales price for all properties in Miami
Figure 1. The median sales price for all properties in Miami (“Real estate data for Miami,” 2018)

The above graph presenting market trends regarding median property sales in Miami between November 2013 and May 2018 implies that the value of residential and commercial properties has been on the increase. In November 2013, the median property sales value stood at $208,399 before reaching $315,000 in May 2018 (“Real estate data for Miami,” 2018). This rise in the median sales price for various properties indicates that the cost of homes and business premises has also increased.

Such a trend is attributed to the activities of wealthy individuals seeking to inhabit and set up businesses in Miami. As such, these rising property values portray the consequences of gentrification in Miami as well as other urban areas that have witnessed the arrival of rich individuals who seek to reside, work, or invest in a less developed region.

Who Takes Over the Newly Developed Areas?

As earlier noted, gentrification brings about the displacement of original residents in a particular neighborhood following changes initiated by outsiders. These affluent individuals take over various developed areas after displacing working-class families that resided in such places for decades or even generations (Hwang & Sampson, 2014). Professionals and their couples or families in the upper-middle-class mainly occupy developed regions after the lower working class relocates due to the scarcity of housing resulting from high rental fees and property values.

New and higher middle-class individuals inhabit urbanized neighborhoods to enhance their proximity to work, public amenities, and transit (Lees et al., 2007). Overall, the need for an urban environment and the pursuit of professional or business goals influence individuals from the upper working class to displace local residents of a neighborhood that is identified as having the potential for growth and development.

According to Ding et al. (2016), in many U.S. neighborhoods that go through gentrification, new inhabitants are mainly white professionals. The arrival of highly earning white outsiders brings about income variations and racial disparities in these neighborhoods (Shaw & Hagemans, 2015). When wealthy white individuals take control over newly developed areas, the most affected communities emanate from African-American, Asian, and Latino racial/ethnic backgrounds. In this concern, Ding et al. (2016) underline that gentrification primarily occurs due to the growth potential of a particular neighborhood and income level disparities between original residents and outsiders.

It is most likely to find individuals with a higher income level such as white professionals and investors taking over newly developed cities after gentrification. Nevertheless, Shaw and Hagemans (2015) assert that the occupation of newly urbanized regions not only involves outsiders but also local residents who have the capacity to utilize opportunities that emerge. Therefore, despite the displacement of a majority of original inhabitants arising from gentrification, newly industrialized areas still depict a degree of racial and income diversity.

Does Gentrification Create Jobs for People in These Areas?

Gentrification is associated with considerable changes in the local employment in the neighborhood undergoing transformation. Various scholars, including Ding et al. (2016), reveal that gentrification is characterized by mixed results pertaining to localized hiring. Some cases depict increased employment of local people while others show reduced job opportunities for locals. According to Ding et al. (2016), indigenous individuals living in an area that is undergoing gentrification may report the lack of job prospects in scenarios where new businesses require more skills compared to what is locally available to bolster productivity.

Companies that outsource labor after setting up operations in a gentrified neighborhood undermine the creation of employment opportunities for original residents, thereby affecting their economic well-being (Hwang & Sampson, 2014). Localized hiring after gentrification is highly dependent on the skills set held by local people. Hence, businesses that strictly consider experienced workers for recruitment seldom create jobs for locals since they avoid the risk of not attaining optimum productivity.

According to Shaw and Hagemans (2015), organizations that have broader hiring networks engage in minimum localized job creation when operating in a gentrified locality. Consequently, this situation leads to the influx of workers sourced from outside the neighborhood experiencing economic changes. Lees et al. (2007) assert that businesses operating in manufacturing and service sectors usually rely on their broad hiring networks to recruit proficient workers. Such a scenario can potentially destabilize the creation of employment prospects among people who have lived in gentrified neighborhoods for a long time, thereby resulting in further income disparities.

The issue of discrimination is also a factor associated with the creation of inadequate jobs for local people in regions experiencing gentrification. An urban area that is under gentrification experiences cultural changes in the form of increased diversity (Shaw & Hagemans, 2015). Nonetheless, wealthy outsiders, usually whites, have been reported to discriminate against minority ethnic and racial groups, especially African Americans, when recruiting employees after establishing businesses in any gentrifying locations (Ding et al., 2016).

Income disparities and racial differences among locals and the arriving outsiders are attributed to the emergence of employment discrimination. Hence, this aspect of prejudice influences the creation of job opportunities for original inhabitants of a neighborhood experiencing the arrival of wealthy professionals and investors from other regions.

In-movers bring about changes regarding the cultural composition of a neighborhood. For instance, original individuals end up being exposed to educated, skilled, and networked residents (Shaw & Hagemans, 2015). Highly educated locals in some neighborhoods are more likely to get jobs in businesses created by arriving outsiders. According to a study by Hwang and Sampson (2014), companies that establish hiring networks in gentrifying areas easily identify talented individuals who can take up open employment opportunities. Hence, as much as a gentrifying neighborhood is composed of highly educated and skilled locals, incoming outsiders who set up businesses consider localized hiring.

Moreover, economic changes arising from gentrification open up opportunities for local jobs. As new businesses and industries emerge in urban areas that experience the influx of outsiders, opportunities in the market arise, thereby allowing locals to seize them as long as they have requirements such as skills and funding (Lees et al., 2007). Additionally, the circulation of information about jobs in a gentrifying area also makes it easy for original inhabitants to make use of such prospects. Ding et al. (2016) reveal that the circulation of information about higher-wage jobs spreads faster among this class of low-income earners who still reside in neighborhoods going through gentrification. In-moving employers who do not discriminate against locals usually foster the creation of different categories of jobs.

Current Residents Maintaining and Staying Afloat During Gentrification

Gentrification in a particular locality influences current residents to employ various strategies for ensuring that they cope with emerging social and economic changes. In most instances, locals usually seek employment opportunities initiated by the economic transformation in their neighborhoods, a typical characteristic of gentrification. As such, despite the existence of racial discrimination in most gentrifying localities, ambitious individuals presently in the gentrified region seek jobs even if they fall in the low-wage category (Hwang & Sampson, 2014).

Educated and skilled current residents also look for jobs to ensure that they maintain and stay afloat amid the experience of gentrification in their localities. Original residents not expecting to be displaced resort to identifying jobs that can provide sustainable incomes proportionate to the cost of living.

Individuals who previously owned multiple properties also consider selling some of them to acquire funds to make more investments in their businesses. According to Ding et al. (2016), family-owned businesses facing competition from the entry of in-moving businesses consider disposing of some of the surplus property to acquire more financial resources to boost the survival of their ventures.

Hence, the use of the available resources to keep up with economic changes occurring in a gentrifying neighborhood is one of the notable strategies applied by original residents to avoid being displaced. Nonetheless, Lees et al. (2007) argue that individuals in a community that is being occupied by outsiders should employ alternative options other than economic strategies to remain productive and afloat, thus mitigating the adversities associated with gentrification. As such, finding social and political solutions to the issue of gentrification is also vital.

Solutions to the Gentrification Problem

The major problem resulting from the gentrification of an urban area is the displacement of the original residents (Shaw & Hagemans, 2015). Remaining in the occupied locality through vitalization can eradicate challenges associated with gentrification. Issues related to racial discrimination with respect to employment among other aspects of life in neighborhoods undergoing gentrification can be addressed amicably, especially when outsiders realize that they have no power to displace original citizens. Consequently, the prevention of dislocation and inequalities due to the influx of wealthy outsiders in a particular locality is a significant solution as far as sustainable urban development is concerned.

Local residents are expected to uphold communication with foreigners to facilitate the attainment of an inclusive society. According to Ding et al. (2016), raising awareness among new neighbors about the history and socio-cultural aspects of the community is a great way of fostering inclusion and mutual understanding. Interactions among original residents and incoming outsiders can go a long way in fostering the exchange of information regarding the traditions of their respective communities. Furthermore, communication can enhance the attainment of an equitable future for both locals and outsiders in a gentrifying neighborhood.

Encouraging policy changes is also a practical way of solving any adversities brought about by gentrification. Hwang and Sampson (2014) underline the importance of advocacy policies and programs geared towards realizing equality and social justice in gentrifying neighborhoods. Such initiatives influence decisions to establish environments that promote fairness amid the existence of diversity and economic changes. Advocacy strategies go a long way in bolstering the sustainability of mixed-income and racially diverse communities emerging from gentrification, thus alleviating any associated inequalities.

Conclusion

Gentrification is a process of urban development whereby wealthy outsiders enter a neighborhood that was previously considered less appealing. This movement results in social and economic changes in the occupied neighborhood. New individuals take advantage of the available cheap property, thereby creating competition that leads to the increased value of material goods. Consequently, the gentrification of a given locality prompts the displacement of poor original residents who experience challenges in terms of securing affordable housing and employment.

As such, rich outsiders are usually the beneficiaries of a gentrifying neighborhood because they use their resources in a way that increases the prices of key socio-economic aspects such as housing. Current residents seek employment or dispose of surplus property to invest and stay afloat in the changing neighborhood. The need for attaining equality and social justice in gentrified neighborhoods calls for the adoption of solutions such as constant communication between original residents and new neighbors. Advocacy campaigns have also been fruitful in solving problems associated with this process because they trigger the implementation of gentrification policies and programs that govern interactions between outsiders and original citizens.

References

DePersio, G. (2018). How much money do you need to live in Miami? Web.

Ding, L., Hwang, J., & Divringi, E. (2016). Gentrification and residential mobility in Philadelphia. Regional Science and Urban Economics, 61, 38-51. Web.

Hwang, J., & Sampson, R. J. (2014). Divergent pathways of gentrification: Racial inequality and the social order of renewal in Chicago neighborhoods. American Sociological Review, 79(4), 726-751. Web.

Lees, L., Slater, T., & Wyly, E. (2007). Gentrification. Abingdon-on-Thames, England: Routledge.

Mcavoy, A. (2018). . Miami Agent Magazine. Web.

Real estate data for Miami. (2018). Web.

Shaw, K. S., & Hagemans, I. W. (2015). ‘Gentrification without displacement’ and the consequent loss of place: The effects of class transition on low‐income residents of secure housing in gentrifying areas. International Journal of Urban and Regional Research, 39(2), 323-341. Web.

Wile, R. (2018). Here’s how much it really costs to live in Miami. Miami Herald. Web.

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IvyPanda. "Gentrification and Displacement of Urban Areas in Miami, Florida." July 20, 2021. https://ivypanda.com/essays/gentrification-and-displacement-of-urban-areas-in-miami-florida/.

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IvyPanda. 2021. "Gentrification and Displacement of Urban Areas in Miami, Florida." July 20, 2021. https://ivypanda.com/essays/gentrification-and-displacement-of-urban-areas-in-miami-florida/.

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IvyPanda. (2021) 'Gentrification and Displacement of Urban Areas in Miami, Florida'. 20 July.

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