CURA Twin Cities Gentrification Project Summary
Since the Great Recession, the Twin Cities Region has rebounded and showed strong employment trends and economic growth. However, this has not been without growing pains. Economic growth has been uneven and the region suffers from some of the largest racial disparities related to education and employment in the country. In this context, the central cities of Minneapolis and St. Paul have seen large public investments including two multi-billion dollar light rail lines as well as new stadiums and public infrastructure like the Midtown Greenway. Through CURA’s community-based research, many of our community partners have voiced concerns that though renewed investment is a positive development, it is also leading to increasing housing costs, gentrification and displacement of existing low-wealth communities and communities of color.
A research team at CURA led by Professor Edward Goetz is using a mixed-methods approach combining quantitative analysis with qualitative interviews to understand patterns of gentrification-related neighborhood change in the Twin Cities. For the purposes of this study, we focus on the time period between 2000 and 2014.
Our unit of analysis is the census tract, which is the standard geographic unit used for gentrification analysis and is analogous to the neighborhood.
Our research questions include:
Based on quantitative data analysis and qualitative interviews, is there evidence that gentrification is occurring in Minneapolis and St. Paul and if so, where?
How do conceptualizations of gentrification differ between local community residents, city staff and elected officials?
Do the quantitative data match with how community members are viewing neighborhood change?
We look for evidence of gentrification using several respected quantitative indices including indices developed by Lance Freeman (Columbia University), Lei Ding (Federal Reserve Bank of Philadelphia), and Lisa Bates (Portland State University). For robustness, we look for agreement of at least two of the indices before we label a tract as gentrifying during the study period.
After combining information from the three previously identified indices, our composite index provides evidence for gentrification occurring between 2000 and 2014 in Minneapolis and Saint Paul. Our preliminary findings indicate that over a third of low-income census tracts in Minneapolis underwent gentrification during the study period and about a quarter of low-income census tracts in St. Paul gentrified.
In both cities, tracts that gentrified were largely clustered close to downtown and around large public investments. In Minneapolis, this included large sections of Northeast, the Willard-Hay neighborhood in North Minneapolis, Elliot Park (near U.S. Bank Stadium) and South Minneapolis along the Midtown Greenway and the Blue Line. In St. Paul, tracts along the Green Line including areas of Frogtown, Summit-University and the West-Seventh Corridor in Highland Park gentrified.
Due to increasing housing costs and stagnant incomes for low and moderate income families in Minneapolis, fewer and fewer neighborhoods are affordable to the typical Minneapolis household. The period between 2000 and 2014 saw the number of neighborhoods that were affordable to the typical renter in Minneapolis drop by 35%. Renters of color saw more extreme drops in affordability with the typical Black renter household not able to afford the typical apartment unit in any Minneapolis neighborhood by 2014 without being housing cost burdened.
Professor Edward Goetz, CURA Director
Update: Clarifying the housing cost and income data in CURA’s gentrification study
We would like to answer some of the questions that have come up about the housing cost and income data used in the preliminary findings of our gentrification study.
The confusion relates to data we presented on how rents and incomes have changed between 2000 and 2014. Here are several points of clarification:
Citywide median values were not used for analysis in our study because they mask large differences from one neighborhood to the next, and are only provided for context. The point of the study is to identify where within Minneapolis and St. Paul gentrification pressures are the greatest and where they are not. For example, the citywide change in median rent does not tell us about what is going on in particular neighborhoods:
Sections of Hamline-Midway saw rent increases upwards of 84 percent between 2000 and 2014, even after adjusting for inflation.
The Cleveland neighborhood in North Minneapolis saw the median rent increase by 70 percent.
Parts of Willard-Hay in Minneapolis also saw rent increases of 45 percent.
Our analysis used figures adjusted for inflation:
Actual rents increased from a citywide median of $575 in 2000 to $854 in 2014 in Minneapolis
Rents and home prices are increasing while the median earnings of renting families–especially renting families of color–have declined in Minneapolis. Between 2000 and 2014:
Income for Black households who rent fell from $19,000 to $14,951 in actual dollars.
Income for Latino households who rent fell from $40,234 to $30,491 in actual dollars.
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.