New dynamics of rent gap formation in New York City rent-regulated housing: privatization, financialization, and uneven development

Teresa, Benjamin F.

doi:10.1080/02723638.2019.1603556

Cited by 34 publications

(23 citation statements)

References 38 publications

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“…Financed by institutional investors like corporations, pension funds, and insurance companies, real estate funds have diversified investors’ existing holdings with a global portfolio of properties, generating returns from monthly cash flows and capital gains from property sales (Van Loon and Aalbers ). Elsewhere, there is evidence that price appreciation practices once confined to the single‐family home market (Smith ), specifically landowners “flipping” distressed properties in order to capture a rent gap, are scaling upwards to institutional investors and outwards towards multifamily homes (Slater ; Teresa ).…”

Section: Rent Beyond the Rent Gap In The Era Of Shareholder Valuementioning

confidence: 99%

From the State to the Shareholder: Rent and the Production of Shareholder Value in Real Estate

Tapp

2020

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Following the 2008 global financial crisis, the use of real estate tax credits to generate shareholder value for investors increased significantly. While tax credits are lauded as crucial to the delivery of social goods like affordable housing, the multiplier effects they supposedly generate fail to account for the hollowing out of the state that occurs as public funds are transferred to shareholders. Through a detailed case study of the historic tax credit industry in the United States, this research shows how many of the banks and financial institutions investing in tax credits have come to rely on overly engineered forms of landownership, deeply discounted credit pricing, and a wave of stock buybacks to boost their corporate profitability. This paper therefore develops a theoretical framework to understand taxation as a financialised accumulation strategy where the state serves as an important—if not problematic—source of real estate profit.

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Section: Rent Beyond the Rent Gap In The Era Of Shareholder Valuementioning

confidence: 99%

From the State to the Shareholder: Rent and the Production of Shareholder Value in Real Estate

Tapp

2020

Antipode

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“…Firms purchase buildings on the assumption that rents can be doubled, tripled, or more." More recent empirical work from Teresa (2019), Sims (2016), and August (2020) depict gentrification as a process driven by real estate investment in the current moment of financialization. Separately, these three studies find that real estate investment in contemporary New York City, Los Angeles, California, and Toronto is predicated on the replacement of current low-income tenants with higher paying households.…”

Section: Financialization Of Multifamily Rental Propertiesmentioning

confidence: 99%

“…Separately, these three studies find that real estate investment in contemporary New York City, Los Angeles, California, and Toronto is predicated on the replacement of current low-income tenants with higher paying households. This research across several cities has shown that rising investor purchases of multifamily properties correspond with rising rents, physical displacement, and neighborhood change (Fields & Uffer, 2016;JCHS, 2019;Teresa, 2019). This pattern of investment is entwined with real estate finance as, nationally, cap rates for apartment buildings have been declining, indicating that prices have been rising relative to net operating income, that rents continue to rise, and that leverage continues to increase (JCHS, 2020).…”

Section: Financialization Of Multifamily Rental Propertiesmentioning

confidence: 99%

Gentrifying Atlanta: Investor Purchases of Rental Housing, Evictions, and the Displacement of Black Residents

Raymond

Miller²,

McKinney

et al. 2021

Housing Policy Debate

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Displacement of Black communities through gentrification is a major concern among policymakers, community groups, and advocates. This research investigates whether investor purchases of multifamily rental housing predict evictions and the displacement of Black residents from Atlanta, Georgia, between 2000 and 2016. In a series of quantitative analyses, we identify the financialization of rental housing and subsequent eviction-led displacement as key neighborhood-level processes in racial transition and the gentrification of Atlanta. We find that eviction judgments grew by 8% annually in the Atlanta region, and same-site apartment sale prices increased by an average of $5.5 million. Investor purchases of rental housing in a neighborhood predict a spike in eviction judgments in the same year, and presage racial transition. Neighborhoods with investor purchases of apartment buildings lose 166 Black residents and gain 109 White residents over a 6-year period compared with adjacent neighborhoods with no investor purchases.

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“…InterRent's repositioning strategy represents a clear effort to profit from rent gaps (Smith, 1996). However, as will become clear, this strategy is not only aimed at revalorizing a rent gap created by divestment and consequentially a lower capitalized rent; it also exemplifies a key cause of financialized gentrification, namely—as identified by Teresa (2019)—a rent gap formed by exploiting the regulatory, financial and geographical possibilities of an ‘increased potential rent’.…”

Section: Technical Class Composition and Financialized Gentrificationmentioning

confidence: 99%

FINANCIALIZED GENTRIFICATION AND CLASS COMPOSITION IN THE POST‐INDUSTRIAL CITY: A Rent Strike Against a Real Estate Investment Trust in Hamilton, Ontario

Risager¹

2021

Int. J. Urban Reg. Res.

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Through a case study of a rent strike against a real estate investment trust in a working‐class neighbourhood in Hamilton, Ontario, this article asks how we might understand class and class struggle against financialized gentrification in a post‐industrial context. While class has been central to gentrification literature, working‐class experience and struggle have often been ignored or conceptualized in a way that precludes agency. New research on financialization of housing often focuses on struggles but has so far paid limited attention to class. In this article I draw on Italian operaismo (workerism) and its concept of class composition to contribute to the current debate by suggesting that financialized gentrification and struggles against it might contribute to a recomposition of the urban working class. Through a qualitative account of the 2018 East Hamilton rent strike, I analyse this struggle as two moments of class composition in the sphere of social reproduction. First, the extraction, exploitation and displacement pressure tenants experienced is analysed through the lens of technical class composition. Second, the rent strike itself is analysed as an expression of political class composition involving a confrontation of urban capital, a politicization of housing precarity, and the building of collective, autonomous power.

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New dynamics of rent gap formation in New York City rent-regulated housing: privatization, financialization, and uneven development

Cited by 34 publications

References 38 publications

From the State to the Shareholder: Rent and the Production of Shareholder Value in Real Estate

From the State to the Shareholder: Rent and the Production of Shareholder Value in Real Estate

Gentrifying Atlanta: Investor Purchases of Rental Housing, Evictions, and the Displacement of Black Residents

FINANCIALIZED GENTRIFICATION AND CLASS COMPOSITION IN THE POST‐INDUSTRIAL CITY: A Rent Strike Against a Real Estate Investment Trust in Hamilton, Ontario

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