Tag Archives: David Galbraith

The problem with gentrification

As explained by David Galbraith

One of the problems with gentrification is that the people that originally make an area more desirable (artists) don’t gain and the people that gain (yuppies), often make it less desirable. The reason for this is that creatives rent and can’t buy, and yuppies buy but don’t create.

But imagine a property fund that was based on a simple rule – follow the artists, it would make a fortune. It should be possible then to fund the arts through some mechanism that capitalizes on this.

An arts fund that created artists mortgages with the expectation that they increase the value of properties without normally benefiting (as happened in Shoreditch) could really help mitigate this kind of change, without any external subsidy. It could be run as a non-profit – but would make a healthy one which is fed back into urban regeneration.

The artists wouldn’t be squeezed out at the inflection point of gentrification (the subsidized mortgages would be funded by the those who decided to sell out, since the capital value increase would be higher than for ordinary mortgages, and a percentage of the profit would be taken by the arts fund). This would dampen the negative effects of change and mean that instead of artist flight and a process of gentrification which destroys the very character that started it (as has happened in NY’s SOHO) you would get organic and long-term, sustainable improvement to neighborhoods.