California: the entertainment capital of the United States, the home of Apple, and the state that is considered as one of the most pleasant in the nation because of its beautiful weather. Leading the nation as the largest and wealthiest state, California also leads the nation with the highest percentage of people that live in poverty when it comes to housing.
The California Housing Partnership Corporation (CHPC) reported in their update of California’s affordable housing crisis that as of April 2015, the state of California currently holds the largest shortage of affordable homes in the nation.
Out of the 5.7 million places there are to live in the Los Angeles County, approximately 48% of these housing units are occupied by renters. Twenty percent of these renters spend more than half of their income to pay for their rent.
“It’s happening right now in L.A.,” Mike Johnstone said, real estate broker of 38 years at Johnstone Realtors.
Governing defined gentrification as not a “master plan” in the real estate market, but rather a demand from consumers. The majority of these consumers are younger people who have money and want to spend it to live in the city.
The issue of gentrification has been an increasing phenomenon in the past decade. According to a recent report by Governing, 51 out of the 999 tracts in the L.A. county have been gentrified since 2000—15.1 percent of which is eligible to be gentrified within the next couple of years.
“You know, it is more expensive here, but there’s also jobs here,” Johnstone said. “The more affluent people are the ones that can afford to buy and that’s what you see happening now.”
Despite the shortage of affordable housing, gentrification has improved the economy, increasing the values of properties of the homeowners. Crime within the city of L.A. has been in decline for 11 straight years, according to KPCC. Gentrification and its ongoing developments have also assisted in the retrofitting of older housing structures that are extremely vulnerable to earthquakes.
“Gentrification does bring some good in the neighborhood where gang violence is decreasing and that is something that the neighborhood needs,” Melisa Romero said, a resident in Elysian Valley for 23 years. “I like that other people are finding interest in our neighborhood and culture, it just bothers me when they come and change things.”
Romero’s surrounding neighborhoods of Silverlake and Atwater Village have seen an increase in small trendy businesses. Her moderately diverse neighborhood of 8,000 residents recently became one of L.A.’s most talked about neighborhoods. According to L.A. Weekly, the neighborhood was given the name title of “Frogtown,” not only because of the neighboring L.A. river, but because of its “laid-back, laissez faire industriousness.” In the 1960s, Elysian Valley was predominately a Latino neighborhood.
These vast improvements and the repercussions were recognized by President Obama. Los Angeles was awarded with $36 million in federal grants in October on behalf of the President’s anti–poverty efforts, also known as the Promise Zone Initiative.
Emphasizing the idea of “supporting people in place,” the initiative will target the urban neighborhoods of Downtown L.A., Pico–Union, West–Lake, Koreatown, Hollywood, and East Hollywood. The Promise Zone addresses four goals which all work in an effort to proved a solid foundation for families that live in the mentioned neighborhoods:
1. Foster good jobs and healthy businesses,
2. Improve educational opportunities,
3. Make the neighborhoods safe and
4. Promote more sustainable and livable communities.
Alison Becker, the director of L.A.’s Promise Zone Initiative, commented that the federal system acknowledged the work that congress was doing in the locations, the community development by corporations, as well as the school programs and activities small entrepreneurial and social entrepreneurs that were providing to improve the educational outcomes for low income students in the area.
“We really want to focus on those most vulnerable populations and help them both to stay in their neighborhoods,” Becker said. “These communities also happen to be located within areas that were targeted with economic development through the redevelopment agency.”
Jennifer Ganata, an attorney with the Eviction Defense Network often sees cases from the neighborhoods that are a part of The Promise Zone. She also helps families that are facing evictions in Highland Park, Boyle Heights, and Echo Park—all of which have also been undergoing gentrification.
The Eviction Defense Network (EDN), a non–profit organization founded by Elena Popp, was created with the mission that everybody gets legal representation when they go to court.
“70,000 evictions happen per year in the county,” Ganata said. “Of the 70,000, only half of those people go ahead and answer the summons and complaint. [That] half of the 70,000—two percent of those people get free legal services.”
For Ganata and her nine fellow women colleagues, the average day at the EDN office in West–lake entails nearly looking over eight to ten cases.
KPCC reported that landlords use the Ellis Act when the market is strong to get the most out of their investment. The Ellis Act allows these landlords to evict their tenants from the rent controlled buildings. The law is permissible when they agree to convert the apartments to condominiums. They can also allow the building to sit vacant for a maximum of five years. The evictions through the Ellis Act rose 325 percent in the past year.
“The city really needs to enforce rent control. People need to know what their rights are and need to fight their landlords,” Ganata said. “I’ve had clients that have come back and from the same neighborhood often.”
While it is the high demand in the real estate market that also drives gentrification, there are protections that have been put in place to preserve affordable housing within Los Angeles. The Housing and Community Investment Department (HCIDLA) is responsible for enforcing the legal eviction protocols and laws under the Rent Stabilization Ordinance and Ellis Act. The rent control protections have been put in place to restrict the charges a landlord can make and limits the reasons for eviction. According to Laura Guglielmo, executive director at HCIDLA, the city has approximately 640,000 rental units that are subject rent control, the majority of which was built before 1978.
Guglielmo also explained that the department has a rent hotline for tenants who are concerned about a possible illegal eviction. Staff from the department also attends community meetings and events to help educate tenants and landlords of their rights and responsibilities.
Guglielmo acknowledges that HCIDLA anticipates a spike in the loss of covenants for affordable housing. HCIDLA currently does not have any funding directly allocated for preservation.
“We are looking looking at preservation strategies that would be no or very low cost for those properties where we we hold some sort of financial leverage, such as an existing loan,” Guglielmo said. “We have and will continue to advocate for funding to preserve the affordable housing stock in Los Angeles.”
In November 1999, the city of L.A. established a Housing Crisis Task Force to consider the crisis of housing affordability Angelenos were experiencing at the time. Referencing Los Angeles as a “city of renters,” tenants at the time were also paying a higher proportion of their incomes for rent. Los Angeles at the time also had one of the lowest rates of homeownership in the country. Being one of the largest metropolitan areas in the Census Bureau’s “Housing Vacancies and Homeownership” data, it was one of the areas that had the lowest homeownership rates of less than 50 percent.
Guglielmo stated that the city will not be re-establishing a Housing Crisis Task Force, but the Mayor has developed a plan to build 100,000 new rental units for all income levels in the next eight years.
Los Angeles is not the only city in California that is experiencing gentrification. San Francisco has also experienced gentrification to an extreme—so much so that it has been defined as a “ruthless” rearrangement in the urban neighborhoods of the city, which was triggered in response to the surge of tech workers migrating to the Bay Area. These tech workers make twice the salary of the average resident in San Francisco.
“Neighborhoods change, it’s inevitable in cities,” Becker said.