Poverty and Gentrification

Table of Content

In recent years, the process of gentrification has become an increasing trend in different communities across South Africa (Cottyn, 2011). The geography of rural and urban areas has undergone various fundamental changes in addition to several dramatic changes over the past few years resulting from gentrification (Cottyn, 2011). Hence, the paper will reflect on the residential and neighbourhood changes and its impacts on the context of Msimang Street in Orlando East. This will be based on fieldwork that was done in this area.

This research follows the discussion with a Marxist approach since as an expression of capital accrual, housing renewal is seen to be leading to displacement of local community and uneven development as a result of increasing housing shortages and property values (Cottyn, 2011). 2. Problem Statement The process of gentrification therefore brings about various changes in different communities. These changes impact both negatively and positively within these different communities in South Africa (Lees, 1994).

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Hence, this paper poses the question: How has the process of gentrification led to residential changes and neighbourhood changes in Msimang Street in Orlando East. 3. Description of study area Orlando East is one of the first townships in the SOWETO region alongside other townships such as Diepkloof, Meadowlands, Orlando West and so forth. The dynamics of urban development were not taken seriously when SOWETO and other historically disadvantaged areas were created. As a result, Orlando

East is largely composed of ‘matchbox’ houses which were built to provide cheap accommodation for workers during the apartheid era. Hence, housing renewal has become a task to transform what was once a black-labour dormitory area in Johannesburg into a prosperous urban area. [pic] Figure 1. 1: Map of the SOWETO region (Source: 4. Aims This study aims to explore the impacts of the residential and neighbourhood changes taking place within the community of Orlando East in Msimang Street as a result of the process of gentrification. [pic] Figure 1. : Dilapidated house in Msimang Street, Orlando East (taken by Mothibedi, R. T). [pic]

Figure 1. 3: Gentrified house in Msimang Street, Orlando East (taken by Mothibedi, R. T) 5. Objectives The objective of the study is to assess the extent to which gentrification has brought about changes in residential and neighbourhood settings in Orlando East, Msimang Street. 1. 5. Research Methodology The study will employ a quantitative method to evaluate the residential and neighbourhood changes in Orlando East, Msimang Street which resulted from he process of gentrification. A literature study was conducted on the process of gentrification to try and understand it in a broad manner. The literature review will provide assistance in justifying the methods to be utilised in this study. A specific street of the study area was selected for a structured technique which included questionnaires, where the houses of the study area were randomly selected. A total of 25 questionnaires were conducted with the head of the households which formed part of the study.

These questionnaires were conducted in order to address the following themes: ? What is the address of the property; ? The number of years one has been residing at the address; ? What type of ownership one has over the property; ? How many rooms and other amenities are in the house; ? Condition of the house when purchased or first moved in and presently; ? Has any renovations taken place since the property was bought; ? What kind of renovations were undertaken; ? Are there any signs of upgrading in the neighbourhood; ? What form of upgrading is taking place? . Limitations of the study There are various limitations to findings suitable answers to the research question. The attitudes of some of the participants were negative towards the study as it seemed like they only answered to pass time and did not show any interest. Another aspect, which was encountered, was that of safety as some of the houses did not look safe to enter. Additionally, some of the respondents felt threatened when filling in the questionnaires as part of the data which was needed concerned issues such as the financial status of the household.

Lastly, language became a problem as some of the respondents could not understand English and therefore this created a barrier and there was a need for translation from the indigenous language to English. 7. Conclusion Chapter one has presented the introduction, problem statement, description of study area, aims, objectives, research methodology and limitations of the study. Chapter two contains the literature study conducted on residential and neighbourhood changes which result from gentrification; it will also highlight the impacts of gentrification in this regard.

The analysis and finding will be presented in Chapter 3. Chapter 4 will provide a summary of all the important themes which risen as a result of conducting the study. 2. LITERATURE REVIEW 2. 1 Introduction According to Visser and Kotze (2008); gentrification, being urban or rural, refers to class dimensions of neighbourhood change. Hence, the defining characteristics of gentrification include social upgrading of the locale by middle or high-income groups who earn better salaries than those in lower income groups, landscape changes and often direct or indirect displacement of lower-income groups (Phillips, 2008).

The geography of rural and urban areas has undergone various fundamental changes in addition to several dramatic changes over the past few years (Cottyn, 2011). For this reason, gentrification has grown from a small-scale urban process pioneered by liberal middle class into a massive trend across communities. The process of gentrification is accompanied by massive changes which have lasting impacts on people’s lives (Lees, Slater et al, 2010). Hence, this paper will highlight the key features of gentrification to rovide the reader with a broader understanding of the term. It will then discuss the consequences of residential and neighbourhood changes which are part and parcel of gentrification on the livelihood of low income urban dwellers. Lastly, the study will make recommendations for future research. 2. 2 Key features of gentrification It is evident that gentrification encompasses three key features in its definition. Firstly, gentrification is necessitated by the displacement of lower-income classes by higher or middle-income groups (Kennedy & Leonard, 2001).

In most cases, these displacements are involuntary whereby original residents are displaced from their dwellings as a result of increasing property values and tax bills (Kennedy & Leonard, 2001). This mainly occurs when people start to feel that they can no longer afford these bills (Kennedy & Leonard, 2001). In addition to families being directly displaced, a form of exclusionary displacement is identified, where changes in the neighbourhood prevents future lower income classes from moving in (Kennedy & Leonard, 2001).

Secondly, gentrification has physical and socio-economic elements as it results in the upgrading of housing units in neighbourhoods (Kennedy & Leonard, 2001). Thirdly, gentrification results in the improved character of the neighbourhood as the infrastructure within the area starts to develop (Kennedy & Leonard, 2001). Hence, the process of gentrification is driven by certain enablers such as a need for housing demands which necessitates these changes. 2. 3 Residential and neighbourhood changes and impact of gentrification

The process of gentrification is made possible by certain drivers such as the need for more houses as more people move into the neighbourhood and the need for security infrastructure as a result of escalating crime incidences in areas where people live which results in the upgrading of these areas ( London & Palen, 1984). These impacts of residential and neighbourhood changes which is part and parcel of gentrification includes the following, each which will be discussed in details in the following sections: • Displacement of homeowners or renters voluntarily or involuntarily; Increasing property values, rates and taxes for owners and rent for renters; • A greater concentration of different income classes and decline of poverty; • Changing neighbourhood atmosphere; • Changing community leadership, power structures and organisations; • The arrival of affluent individuals in a neighbourhood increases its value in the eyes of outsiders 2. 3. 1 Displacement Displacement of low-income residents is one of the main components of gentrification. It is also the most severe impact of gentrification.

The amount and nature of displacement is based or determined by the housing supply and demand of local housing markets (Bourne, 1993). For instance, where the demand of housing is extremely high, therefore the cost of housing will escalate resulting in the number of displacements being greater and its impact on those displaced being severe (Bourne, 1993). Additionally, the escalating property rates and taxes on households in rehabilitated areas can put pressure on elderly homeowners who survive on a fixed income every month (Kennedy & Leonard, 2001).

While low-income renters are also exposed to displacement, as they cannot afford rental increases as a result of owners upgrading their building into apartments (Kennedy & Leonard, 2001). However, gentrification pressures provide existing homeowners with better choices. As some middle-income homeowners start to afford increased property values and rates and can enjoy the benefits of gentrified houses which gives them a choice whether to sell or not.

On the other hand, a significant number of minorities are displaced as they are forced to move out to communities or neighbourhoods with more affordable housing options. Hence, the benefits of property appreciation are likely to flow to some of the most vulnerable portions of the lower income population (Kennedy & Leonard, 2001). According to Statistic SA (2011) approximately 30 percent of low income homeowners have single elderly households, over 50 percent of all low-income homeowners are female headed households and 25 percent are headed by non-parent individuals.

For those families that were displaced, both social and economic costs of displacement can be extremely high (Atkinson, 2004). Lastly, when a family leaves a neighbourhood it will miss out on the chance to share both social and economic developments within the neighbourhood in the future generations (Atkinson, 2004). Additionally, future generations could miss the significant history of the neighbourhood which can be passed down from generation to generation by elderly residents (Atkinson, 2004). 2. 3. 2 Increasing tax incomes

An influx of higher income residents who eventually renovate their property use more municipal services such as water and electricity which is accompanied by higher rates paid by the users to the municipality (Kennedy & Leonard, 2001). Higher tax revenues can help pay for services and investments that local resident need and further neighbourhood revitalisation. Lang (2004) found that “gentrification produces increased revenues for municipalities and that these revenues are not erased by the demands of newcomers for civic improvements”. However, new revenue generated rom higher income residents is reserved for improvements of local services in gentrifying neighbourhoods, at the expense of other surrounding neighbourhoods (Atkinson, 2004) 2. 3. 4. A greater concentration of different income classes and decline of poverty The interest shown by middle and higher income groups to gentrifying neighbourhoods is an attempt to decrease the high levels of poverty households (Butler, 2001). According to Turner and Ellen (2001), successful efforts to improve incomes, decrease poverty and creates different income classes in neighbourhoods which has a significant impact on the wellbeing of households.

Hence, various neighbourhood settings such as those which exposes children to criminal behaviour has a negative impact on their psychological development and their socio-economic development which will affect the life choices they make in the future (Turner & Ellen, 2001). High poverty rates, the prevalence of a high illiteracy rate, high unemployment, and the prevalence of single-parent families have all been found to lead to financial insecurity which increases the likeliness of being displaced by more affluent groups for poor households (Butler, 2001).

Although the effects of the neighbourhood environment are found to be significant, they are much smaller than the effects of family characteristics. 2. 3. 5 Changing neighbourhood atmosphere The influx of higher income residents has a number of potential effects on the neighbourhood atmosphere. New residents and their purchasing power create potential customers for existing businesses (Kennedy & Leonard, 2001). They stimulate developments which might serve the neighbourhood needs such as new businesses. In turn, increased competition for space and the market may lead to higher rents for businesses and displace small, locally wned but profitable out of the market place (Lang, 2004). Therefore, gentrification brings about residential and neighbourhood changes as residents support developments in the area such as a change in the street character and composition. 2. 3. 6 Changing community leadership and institutions Gentrification often brings changes in a community’s power structures, changes in its elected leadership and often shifts in the character and number of its political and social service institutions (Kennedy & Leonard, 2001).

Financially stable people who occupy gentrified houses practice more political choice than poor people and therefore, have the authority to hold their leaders into account and thereby creating responsible and accountable leaders. New household residents bring concerns with regards to their neighbourhood improvements and their financial investments to these improvements because of the rates and taxes they pay to the local municipality. These new residents often promote the development of new and improved schools, lower crime levels and improved local municipal services. 2. 3. Increased value placed by higher income groups Gentrification brings increased housing values and higher rates and taxes. Rising property values have various impacts for various stakeholders. For many, increasing property values are beneficial as homeowners gain equity, city tax revenues increase and the neighbourhood may transform into a vital and lively atmosphere (Cottyn, 2011). Gentrification may allow previously unrecognised value in a neighbourhood such as quality housing stock, accessibility and proximity to other attractive neighbourhoods to be realised (Cottyn, 2011).

The process of gentrification is tabulated below: |Drivers/ Enabler/Causes |Process |Consequences/Impacts | |Job Growth |Gentrification |Displacement | |Housing Market dynamics | |Increased Tax revenues | |Constrained supply | |Increased income mix | |Affordability | |Deconcentration of poverty | |High demand | |Changing neighbourhood atmosphere | |Preferences for urban living | |Changing leaderships and institutions | |Public incentive- direct and indirect | |Changing income mix | |Quality of life issues | |Changing property values | | | | |

Table 2. 1: Process of gentrification, Source 4. Conclusion Too frequently officials, developers and advocates suggest that gentrification is “good,” or “bad,” or “necessary,” or simply “the market at work” (Kennedy & leonard, 2001). This paper concludes that gentrification is a process that emerges when a number of factors come together. It is a complex process with complex impacts that can be either good or bad or both depending on the investor.

The challenge brought about by gentrification is to recognise it and bring about equitable development and take actions early to eliminate potential impacts. Broader socio-economic renewal forces will have a bigger chance of success, a bigger chance of extensive neighbourhood support that is so often essential to their effectiveness, and will provide more benefits for neighbourhood residents. 3. Findings and Analyses 3. 1 Housing renewal as a form of gentrification: A case study in Orlando East

The renewal of housing is a form of gentrification which is taking place in Orlando East and has largely been executed by middle income residents who feel the need to transform what were once ‘matchbox’ houses which were built to provide cheap accommodation for workers during the apartheid era into a prosperous urban residential area. The reader must be aware that the term ‘middle income’ refers to those who earn a higher income than many in Orlando. Housing renewal can therefore be seen as a form of gentrification as it has similar impacts with gentrification.

These impacts consequently lead to various residential and neighbourhood changes within different areas. Therefore, the area of Orlando East is experiencing these transformations of housing renewal and neighbourhood changes through the process of gentrification which lead to the rehabilitation of houses and community development with or without state sponsorship. As a result, housing renewal can be seen as a form of gentrification as it leads to the rehabilitation and renewal of ‘matchbox houses’ or run-down houses into large stable homes. 3. Trends in residential and neighbourhood changes in Orlando East, Msimang Street Housing renewal which is a form of gentrification therefore results in numerous residential and neighbourhood changes which may vary from one household to another due to income-class divisions. As lower income classes are not able to renovate their houses like middle or higher income classes. These residential and neighbourhood changes which are taking place in Orlando East range from basic changes or renovations such as; • Planting of trees as an initiative of making the neighbourhood environmentally friendly and green, tarring of roads to improve their state; • paving of sidewalks, • building of garden walls, • installing of street lights , • providing a cleaner environment to effect major changes such as:

The total renovation of the property whereby the property is either extended by adding more rooms to the house as well as backrooms or by remodelling the kitchen or bathroom and or painting the interior and exterior of the house. These residential and neighbourhood changes have positive and negative impacts which result from gentrification. Hence, these positive impacts vary from: Stabilisation of declining areas; • Increased property values; • Encouragement and increased viability of further development; • Increased social mix and decreased crime While the negative impacts of gentrification include; • Displacement of people as a result rent and property price increase; • Secondary psychological costs of displacement; • Detachment from affordable housing; • Unsustainable speculative property; • Homelessness; • Increased cost and changes to local services, • Displacement and housing demand pressures on the surrounding poor areas.

Therefore it can be seen that gentrification has positive and negative impacts but creates a problem of displacing people from their original dwelling. However, gentrification has linkages with displacement as when property values increases, lower income groups are displaced as they can no longer afford the rates and taxes as well as other local services. Displacement therefore leads to other negative impacts such as homelessness and an increased housing demand on poorer areas as lower income groups who can no longer afford houses are forced to move to other areas or poorer areas where they will be able to sustain their lifestyles.

Another impact which results from displacement is increased levels of crime as often gentrified household become targets as they are seen to be luxurious. Displacement causes rift and bitterness amongst those who cannot afford to live in the neighbourhood anymore. 3. 2 Residential and neighbourhood changes 3. 1. 2 Demographic |Demographics of the study area | |Age |Minimum Age group |Maximum Age group | | |3 |81 | |Gender |Total No. of Males |Total No. of Females | | |33 |44 | |Total No. f people in the |Highest |Lowest | |household | | | | |16 |2 | |Total number in the households |77 | |Approximate length of the street |280m |

Table 2. 2: Demographics of study area The table above shows that an approximate space of 280 meters is occupied by 77 people in total of which 33 of the 77 are male and 44 are female. The minimum age for all these 77 is 3 years old for the youngest and 81 years old for the oldest. The lowest number of occupants in the houses is 2 whereas the highest number of people is 16. 3. 2. 1 Ownership Ownership % | |Owner |84% | |Tenant |16% | |Sectional title holder |0% | |Other |0% | | | | Table 2. 3: Ownership of study area Of the twenty five questionnaires, 84% of those who were surveyed were the house owners, whereas the remaining 16% were tenants. This might mean that there is a very low number of low income earners living in this area as a result of the renovations that are made in this area resulting in an increase in rents and taxes. 3. 2. 2 Renovation of houses |Renovations to the property |Number of houses out of 25 | | Yes |15 | | No |10 | | | |

Table 2. 4: Renovation of houses [pic] Chart 3. 2: Number and type oof rooms The bar chart above displays that from the twenty houses which were surveyed, there was a total of 17 lounges, 9 dining rooms, 37 bedrooms, 1 study area, 25 kitchens, 7 bathrooms, 4 garages, 60 back rooms, 37 shacks and no family room and sculleries. This paints the picture that even though a lot of renovation has been made in this neighbourhood, some improvements still needs to be made as there is still a high number of shacks. [pic] Chart 3. 1: Renovations to property

Of the twenty five questionnaires conducted, it was revealed that fifteen of the twenty five houses have recently been renovated, which points to the fact that gentrification is taking place within this area (Orlando East, Msimang street). The latter also means that these renovations are leading to more demands for municipal service such as electricity and water. Additionally, this also leads to an increasing cost of property as these houses appreciate as a result of the renovation work. Additionally, the latter also suggest that these renovations are leading to the upgrade of the entire area.

On the other hand, of the twenty five questionnaires which were conducted, it was also revealed that ten of the twenty five houses have never been renovated and they were still in their initial state. Nevertheless, it seems as if though the owners of these houses will be put under pressure to renovate their houses as it comes with a certain pride. They feel that the renovating of property, especially building safety walls around the house will provide more security. 3. 2. 3 Neighbourhood upgrades and changes such as street light in percentage |Neighbourhood upgrades and changes | |Yes |88% | | No |12% | | | | | Table 2. 5: Neighbourhood upgrades and Changes From the twenty five questionnaires which were conducted, 88% of those agreed that upgrades such as the planting of trees, tarring of roads, paving of sidewalks, and cleaning of neighbourhood have been made in the area while the other 12% believed not. The latter proves that much is being done to improve the neighbourhood. Even though the process of gentrification can be largely achieved without the help of the government it does show that the government also has a part to play in this process as many of these projects were funded by the government.

This will largely influence and increase the viability of future development. But the failure of the municipality to install street lights in the area will result in residents who live in fear of being robbed. Nevertheless, the planting of trees and all other developments made in the area leads to overall improvements in neighbourhood. Of course the reader must be alerted that improvements in a neighbourhood are accompanied by an increase in the cost of living, thereby this might force other residents to start looking for housing elsewhere. . 2. 4 Level of income |Level of income and frequency of earners | |Level of income |R10 000 | |Frequency |25 |6 |2 |0 |1 | The table above indicates that from the 25 questionnaires which were surveyed, there were 25 people who earned less than R4 000, 6 people who earn between R4 000 and R6 000, 2 who earn R6 000 between R8 000 and 1 who earns more than R 10 000 on a monthly basis which makes a total of 34 income earners out of the total 77 that makes up the population. 4. Conclusion 5. Bibliography 6. Appendices

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