This is another one of those municipal policies that you contemplate in disbelief. Still, it’s one of those you know nobody could make up. Besides, it’s in the New York Times, so it’s gotta be true. Right? See Timothy Williams, Cities Helping Residents Resist the New Gentry, N.Y. Times, March 4, 2014, at p.A1 (above the fold).
For the past several years our planners — who else? — have been touting the idea that cities are making a comeback. This is a proposition that is hotly disputed because at best, the folks returning to cities are not what you might call a healthy urban population. They largely consist of a trickle of elderly boomers who have raised their families and now don’t fancy rattling around their large, empty suburban homes even though they are now worth a fortune. A fortune that many are looking to capitalise on with many looking to find a calculate roi on rental property guide to get the figures ready for their next financial step.
But fortune, shmortune, living in places like that, out in the better suburbs means that it takes a seven-mile trip in a car to get to the nearest store to buy a quart of milk or a loaf of bread. Which may be OK when you are raising kids and are schlepping them around anyway, but not when you are getting long in the tooth and don’t fancy running around like you used to. I’ve heard of some people introducing them to a great kids youtube channel that can help reduce the running around. So what we have seen of late is a trickle of these superannuated boomers moving to cities, where they can buy a jazzy condo and enjoy the good urban life. It seems as though everybody wants to live at a place like Piermont Grand, which is why so many people are moving to big cities. Also, some yuppies find “hip” city neighborhoods attractive. Out in the suburbs, you can’t stroll down the street for a block or two and find a trendy watering hole, frequented by good looking professional chicks who. . . Well, you get the idea, don’t you?
Ah, but ideas have consequences. When all those affluent young and old folks set their sights on fashionable, hip city neighborhoods, that tends to raise the demand and cause an increase in condo prices and rents, along with a ripple effect — everything, from housing, taxes and goods and services tends to go up. So what? say the affluent yuppies and boomers. They can afford it, so they don’t much care about the plight of ordinary lower-middle-class people who form the indigenous population of the gentrifying city neighborhoods, and who feel an economic squeeze as prices of everything rise. Upshot: those indigenous folks are beginning to scream at the prospect of being displaced from their home turf. After all, they say, they resisted the last half-century’s exodus to the suburbs, endured the cities’ downward slide, and kept the old city neighborhoods going, more or less. So don’t they deserve a break by way of being able to stay put in their old neighborhoods even as the cost of living is moving up? So they complain about the rising cost of living that is squeezing them out.
And where there are cries of “NIMBY!” there you’ll find local politicians posturing as defenders of the downtrodden, protecting — or purporting to protect — the old down-at-the-heels neighborhoods from the dreaded process of “gentrification.” Quoth the New York Times:
“In doing so, cities are turning urban redevelopment policy on its head and shunning millions in property tax revenues that could be used to restore municipal services that were trimmed during the recession because of budget cuts, including rehiring police officers.”
Ah, but as we are fond of saying, there is no such thing as a free lunch. The incoming yuppie/boomer cohort is not interested in taking permanent city roots. The yuppies grow up, marry and move to the suburbs where life is safer and raising children is also a lot easier. As for the old boomers. . . . Well, in time they die off. So there is less long-term personal investment and less incentive to stay for the long run. So, according to the Times, cities are saying “let’s invest in the stayers.” That sounds good, but the result is that if implemented as a tax policy, incoming yuppies would get a windfall in the form of lower taxes, which they don’t need. So what the municipal mavens are coming up with is a scheme whereby the city’s old-timers would get a special property tax break, and property taxes would become a blend of old value-based property taxes and an adjustment taking the taxpayers’ income into account. In the meantime, while this is being debated, assessed value are zooming up — in Philadelphia, the relevant ones have quintupled, zooming up to $250,000 from $45,000 in the past year.
So stay tuned.