I am one of those people who recently moved from Los Angeles and bought a home in Tennessee. I feel so defensive about this that I lied to my pest control person when he asked me directly if I moved from California.
I said, “no, from down the street,” which is technically accurate, as the house we’ve been renting for the last two years is roughly a mile from our new home. I eventually admitted he was right but offered lamely, “my husband went to Central,” referring to the high school he graduated from in Knoxville.
I do feel guilty, excited, and still slightly in disbelief. We are so fortunate to have purchased a home, an accomplishment I never imagined possible. I worry about the housing issues Knoxville is currently facing and will continue to face.
This is an anxiety that most people in Knoxville, especially folks who rent, are feeling. The east Tennessee rental market is up 45% in 2021 versus 2019, with home prices in Knoxville increasing by 21.4% since last May, outpacing Nashville. And people are right to be concerned because homeownership is one of the most effective pathways to financial security for working people, providing middle-class income earners with 50-70% of their net worth.
Homeownership also partially accounts for the racial wealth gap we see in this country, with pre-pandemic black American households, with 1/10th of the wealth of white households, a figure that has only gotten worse from 2020 to now.
No one can stop folks from moving in from out-of-state, and no one likely blames the person who sells their home to the highest bidder. As someone who grew up in southern California, I can relate to people’s frustration with folks from out-of-state moving to Knoxville.
The last seven years that I lived in Los Angeles, I held a relatively well-paying union job, but I could not afford to buy a home. This is partly due to the constant influx of people moving in from out-of-state, driving up the rental market, and in turn, driving up the housing market.
Having a relatively well-paying job does not guarantee you will be able to purchase a home if the market is out of control. That means that I have had to pay rent my entire adult life, with no sign of when or if I would be able to purchase a home.
In fact, I moved five times in six years- from Echo Park to Silverlake to Atwater to Valley Village to Tujunga. Drawing a line from one neighborhood to the next, you would observe something similar to a backward question mark. As neighborhoods gentrified around me, I chased lower rental prices north.
As wealthier people move in, businesses follow, driving up the property values and rent prices along with it, eventually pushing out the residents who made the neighborhood attractive in the first place. The residents then have to migrate to less expensive areas, scattering the community to the wind. This is what happens to working-class people as neighborhoods gentrify.
So, what can neighborhoods do to protect themselves from gentrification? I offer an example of what one neighborhood did to keep their communities safe in the face of development.
The Dorchester and Roxbury neighborhoods are multi-ethnic working-class neighborhoods outside of Boston. Like many multi-ethnic neighborhoods, this community was redlined, a practice that blocked access to insurance-backed mortgages to areas deemed “risky” to investors.
As a result, many landlords turned to arson to off-load properties, vacant and occupied, and residents reported fires occurring every night. One resident, Sophia Carthy, remembered, “you had to be very careful, we had to stay up half the night hoping that they didn’t firebomb the place.” By the 80s, the neighborhood was blighted and often used as an illegal garbage dumping site.
In 1984, the Riley Foundation presented a plan for neighborhood investment in a town hall forum. Because the former Dorchester and Roxbury residents were offended that they were not included in the process, the project was scrapped and restarted to include the locals. Thus, the Dudley Street Initiative was created, and its Board of Directors was formed by the residents’ election.
Of initial concern was the illegal dumping, and so began the “Don’t Dump on Us Campaign,” which included blocking illegal trash transfer stations and taking on City Hall. These efforts increased neighborhood confidence and cohesion. The DSNI invested in urban planners and lobbied Boston’s mayor for investment. Around the same time, a plan from City Hall was leaked.
The plan proposed a revitalized business district with no plans for affordable permanent housing in the Roxbury neighborhood. Resident and first president of the DSNI, Ché Madyun, said of the city’s plan:
“It really just sounded like a plot for gentrification. It really confirms the belief that we all had on my end of Dudley– that they’re coming through the southland, they’re going to do Dudley Square, just a few minutes they’re going to go right down Dudley Street. We’re only a hop, skip, and a jump from downtown. I can see downtown from my window. How many times are we going to allow them to push us from one place to another in this city?”
The DSNI protested. Eventually, their plan was approved in 1987, granting 134 million dollars in public funds and the use of the eminent domain to acquire fifteen acres of vacant privately-owned lots, bringing the total to over thirty acres of land.
Today, the DSNI has 227 units of affordable housing, 98 permanently affordable homes, 77 cooperative housing units, and 53 rental units. Additionally, playgrounds, community gardens, and two commercial buildings. To learn more, please visit the Dudley neighbors website.
There are some takeaways from the Dudley Street Initiative.
First, success takes a tremendous effort with sustained community engagement.
Second, city leadership has an evident tendency to prioritize business over residents, as we see with City Hall’s attempt to create a thriving business district without prioritizing affordable housing.
As attracting new businesses often accelerates the process of gentrification, any plans in this area without sustainable housing are a threat to local renters.
As one resident said: “Dudley Square is going to be revitalized with a hotel and office buildings or whatever. Then what’s your fear? Your fear is ‘oh, you’re done with us’, where are we going to go? Come on, I’m not going to own the hotel.”
In the face of this challenge, the DSNI banded together and took on city leadership, secured the funding to improve their neighborhood, and permanently placed the land in a trust.
I argue that this victory was only possible by providing an ownership stake to residents in the community. Why work to improve a community if the improvements create a risk that you will be pushed out?
You can access the documentary on the formation of the DSNI here.
Historical Redlining in Knoxville:
How did the DSNI create permanent sustainable housing? Through the community land trust model, which I believe could solve the housing crisis in Knoxville.
The Community Land Trust Model
The community land trust (CLT) is a non-profit which holds land in a trust, overseen by a Board of Directors, consisting of residents of the CLT, residents of the greater community where the CLT resides, and experts and other stakeholders. The CLT acquires land through various sources, like city-owned property, private donors, community foundations, and federal housing subsidies.
Homes are built on the property, then sold to buyers at a reasonable rate while the land underneath the house stays in the trust.
The home price is significantly less than the nearby market value, partly because the buyer agrees to a land lease and the contractual obligation to resale the home at a sustainable price. The buyer is now a resident of the trust. In return, some repairs and improvements are provided, and each resident now has a voice in decisions made by the trust.
When they sell, they are bound to an upper limit on the home resale price set by the CLT. The trust sets the formula (learn more here).
Typically, if you cannot afford to buy a home at market value, you have no choice but to rent. The last home we rented in California was a two-bedroom in Tujunga, north of Los Angeles, where we paid $1900 a month to the homeowner.
Thankfully, in the four and a half years we lived there, our rent never increased. By the time we moved out, we had paid our genuinely lovely landlord $102,600. That money is gone from us forever. We could have built equity if we had access to a CLT property.
Most CLT homeowners are first-time buyers, earning less than 50% of the area’s median income. With the CLT model, home prices are lower, making them affordable to people that would not qualify for traditional homes at market value. This makes home foreclosure less common than with conventional first-time home buyers.
The CLT model provides a path to equity that a renter could never access. Following this model, 80% of CLT homeowners use the equity created to purchase their next home at market value.
There are currently at least 277 community land trusts in the United States, with one in development in Nashville.
I remember living in Echo Park, a neighborhood north of downtown, where two shootings happened in front of my apartment. In those moments, I felt less concerned for my safety than when I started to notice more coffee shops opening in the neighborhood.
I knew that rising rental prices were more of a threat to me than gang violence. I felt a small fraction of this here in South Knoxville when the Baker Creek Reserve opened near the home we were renting. This is the renter’s dilemma, rooting against the development of your neighborhood because you feel more like a visitor than a resident.
I thought owning a home would inoculate me from that fear and reservation. That familiar feeling crept in as my husband, and I walked near Suttree Landing Park and witnessed the work being done to build the new Dominion Group housing development. The new sixty million dollar project proposes ten buildings with 230 apartments, with rent estimated at $1100 for a studio, one-bedrooms for $1300, and two-bedroom units at $1900.
This apartment complex will inevitably increase rental prices in the neighborhood and nearby housing values. The project promises to address issues occurring near Sevier Ave– specifically the lack of parking and commercial space. Development projects usually promise to improve neighborhoods, but they do not consistently deliver.
A specific example is a dispute between the City of Knoxville and the One Riverwalk Properties, which became so contentious that the property group blocked access to a popular riverfront walkway because the city refused to sign off on public improvements agreed upon before development.
To ensure developers keep their promises, residents need to keep pressure on developers, as well as the city. In south Knoxville, it appears residents are doing just that. In March 2020, the community gathered 600 signatures to oppose Dominion’s attempt at bypassing frontage coding requirements, with the city council denying the developer’s request. I am heartened to know that the residents of this neighborhood are involved.
I hope that we address housing and community development in ways that do not rely predominantly on the preferred methods of people who already have capital to generate more wealth yet. What if the community owned the land, and the residents decided how to best address their own needs?
Community-led housing alternatives start with neighbors talking to each other about their concerns and visions for the community. Ask Brian, my pest control person, who will never get back the time I stole from him because he innocently mentioned the housing market.
Joking aside, maybe the next time the housing market comes up in conversation, you can tell someone about a “new” model you came across.
I learned about the CLT model while studying at the University of Tennessee, Knoxville, as a master’s student in the College of Social Work. I am concentrating on macro social work: organizational leadership and community organizing. If you are interested in discussing the CLT model, please contact me by visiting https://linktr.ee/Knox_clt.
Sources
- Knox News: Commercial real estate experts on what’s next for Knoxville’s market.
- Knox News: How out-of-state homebuyers are contributing to Knoxville’s tight real estate market.
- Grounded Solutions: Balancing Affordability and Opportunity in Shared Equity Homeownership Programs.
- Brookings: Rethinking homeownership incentives to improve household financial security and shrink the racial wealth gap.
- Brookings: Examining the Black-White Wealth Gap.
- Community Wealth: Overview: Community Land Trusts (CLTs).
- The Housing Fund: Frequently Asked Questions.
