A CONVERSATION WITH: CHRISTOPHER B. LEINBERGER.

• Position: THE Monthly INTERVIEW - Interview

Want to stop the gentrification of old urban neighborhoods? Build new ones.

Among liberals, few topics are as hotly debated as gentrification. The issue is often presented in moralistic terms: privileged white people are pushing poor black and Hispanic people out of their neighborhoods.

The truth is a little more complicated. Booms in places like New York City and Washington, D.C., have both positive and negative effects--including for the poor. They have revitalized previously dangerous and economically depressed neighborhoods, bringing better jobs, safer streets, and, for homeowners, rising property values. The rapid pace of change and rising rents also raise the danger, however, of too many spoils going to the white and wealthy, leaving the poor and minorities behind.

Chris Leinberger, a real estate developer and chair of the Center for Real Estate and Urban Analysis at the George Washington University School of Business, spoke with the Washington Monthly at the Wharf, the new waterfront development in Southeast D.C., about the underlying policy choices that have led to urban housing unaffordability, and how to change those policies to make sure urban renewal doesn't just benefit the rich.

(This interview has been edited and condensed.)

WM: What do you worry about with these booming towns, like D.C.--who is potentially getting hurt by development?

CL: The folks who get hurt the most are existing renters. They'll not only see their rents go up; they'll be moved out completely, if their building gets rehabbed.

Now, a development like [the Wharf], of course, nobody was living here, so there's no displacement, which happens quite a bit in our formerly abandoned cities.

WM: So maybe a better example of this in D.C. would be a neighborhood like Shaw or Williamsburg in New York?

CL: Exactly. But the interesting thing is, Federal Reserve research shows that neighborhoods which are gentrifying (a) make up a very small fraction of city neighborhoods--as in 5 percent--and (b) actually have less movement than poor neighborhoods do. The primary reason is that people will try their hardest just to stay there, because it's getting better. All of a sudden you have options like a supermarket, and crime is going down, and there are more public amenities. You would want to stay if at all possible. In a poor neighborhood, there's much more spin.

WM: You're saying the research on gentrification shows that some of our concern about the victims of gentrification may be misplaced?

CL: If it's a moderate to poor neighborhood, the people who have lived in the neighborhood for decades and own their own house will have a much larger net worth than if gentrification didn't happen. It may be what pays for their retirement.

WM: But in an urban area, isn't there usually a very high proportion of people who rent and don't own?

CL: Suburbs are 75-25 ownership versus rental, urban areas will be closer to 50-50. In New York City, it's closer to 33 percent ownership and 67 percent renter--which is why I mentioned that the main concern is for renters. But the other key point is that those low-income households--and I'm talking about households earning less than 50 percent of the metropolitan area median income--are far better off living in a revitalized, walkable urban place. Yes, the housing prices may be higher as a percentage of their household income, but the transportation costs are much lower, and transportation is the second-highest household spending category. That offsets those higher housing prices. And they have accessibility to three, four, five times more jobs than they would have if they were in a low-income drivable...