Prof. Myron Orfield’s response to the CURA study on gentrification in Minneapolis and St. Paul contained important misinterpretations of our study that could mislead people about what is going on in our neighborhoods (“Gentrification isn’t the rental problem; poverty is,” Dec. 1).
First, he makes reference to changes in citywide median rents. But that is to miss the very point of our study. Citywide median values mask large differences from one neighborhood to the next. Though the after-inflation median rent in Minneapolis only rose 5.6 percent from 2000 to 2014, it rose 45 percent in Willard-Hay, and 31 percent in Uptown. Similarly, across St. Paul the after-inflation median rent rose 3.5 percent from 2000 to 2014, while it rose 31 percent in Frogtown during the same period. The objective of our study is to identify where in the cities gentrification pressures are the greatest and where they are less intense. Citywide change tells us nothing about particular neighborhoods.
The second problem in Orfield’s response is that the figures he cites from our study are rent increases that are adjusted for inflation. Quoting these figures out of context, Orfield implies that actual rents have not increased very much in the cities. This is misleading and wrong. Because of inflation, in 2014 (the endpoint of our study), it takes $141 to buy as much as someone could purchase with $100 in 2000 (the starting point of our study). Adjusting for inflation is a technique many analysts use to compare the value of something at two different points in time. But people pay their rent in actual dollars, not inflation-adjusted dollars. So although, when adjusted for inflation, median rents in the cities rose 6.5 percent, in actual dollars the increase was from $575 to $854 per month. In Willard-Hay, actual monthly rents increased by $640 from 2000 to 2014. In Frogtown, the median rent went up $414 per month, and in Uptown, the increase was almost $500 per month.
What makes these dramatic rent increases even more of a problem is that they are occurring at a time when wages of renting families lagged far behind. Lagging wages are especially pronounced for people of color in Minneapolis and St. Paul. These changes in the housing market and the large disparities in income and wealth that exist along racial lines are the very things we should be concerned about when considering whether gentrification pressures exist in Minneapolis and St. Paul neighborhoods.
CURA’s research on gentrification is in its beginning stages, and we welcome discussions that will help shape the next steps of the study. Materials from the CURA Housing Forum where our initial findings were presented are available on our website, which will be updated as new research is available.
Edward Goetz is director of the Center for Urban and Regional Affairs at the University of Minnesota.