Universities’ Impact on Gentrification
BY Mia Tero
When people think of the concept of gentrification, the first thing that comes to mind is the introduction of wealthier people into lower-income neighborhoods, followed by the moving of more expensive big businesses and renovations of existing buildings and housing. Then they may infer that from this movement, lower-income residents previously living there are pushed away from their properties and lives by being forced to move to different, less expensive parts of cities. Because of this implication, many people believe that it is big housing corporations and businesses that solely perform gentrification, and while they do contribute, institutions such as private universities tend to go widely overlooked. In most urban universities, the schools are highly closed off to the surrounding community, and there is little effort to form relationships with the community outside their gates. At the same time, the student population contributes to the increase in housing prices and the desire to implement more big businesses in these places. This is because these establishments will reap the benefits of students buying their products. There needs to be more concern about how these interactions with the community will alter the lives of those living around the universities, especially regarding affordable housing and other expenses that come with surviving in a city. Urban universities play a significant role in the gentrification of the communities they inhabit and should be expected, particularly financially, to engage with communities to protect these areas and the people.
Urban universities are assumed to be separate from their local communities due to the closed-off nature that many of them have. However, these universities and their students contribute largely to the economy in both housing and the general sense. While the students live in a typically isolated space, it is not anticipated that they will stay on these grounds, meaning they go into the communities, spend money, and ultimately contribute to the surrounding businesses. For the most part, these contributions sound like a good thing, and in many cases, they can be, but they can also cause an increase in the prices of goods for others living around these institutions. Not only can urban universities have this effect on goods, but they can also raise housing prices in the surrounding areas. Many college students are looking to move off campus during their upperclassmen years, and for the same reason of being supported financially, they have more money to spend on housing. From this, landlords can expand their rent to meet the price of what college students are willing to pay, and in many cases, this is a more considerable amount than what the people in the community can afford.
In fact, in the Belmont community that Fordham University Rose Hill inhabits, this form of landlord increase in rent has been documented. With more than half of the Belmont community receiving welfare assistance of some sort, in comparison to the students of Fordham that are on average paying thirty-eight thousand dollars a year on education alone, there is a significant separation between expendable income and the amount these two parties can spend on housing. A former Fordham student, Michael Charboneau, had studied the impact that students moving off campus had on the Belmont community for his senior thesis and concluded that “Belmont landlords are actively targeting students because most have financial guarantors and do not default on their payments because of it…So landlords are increasingly becoming aware of this. You can triple your rent, it’s no problem” (Charboneau 2015). With the gained ability in our area to increase rent prices to this extent, it is evident that university students moving off campus to find housing can drastically impact the affordability of apartments for previous residents of the area. Because of this, the rent in the Belmont community has increased by twelve percent over the previous year for single-bedroom apartments and nearly 53% between 2015 and 2022. The average price for multi-room apartments follows a similar trend, with the median rent increasing from 3,000 dollars in 2018 to 5,000 dollars in 2020. This is approximately a 66.6% increase in rent in two years, according to the online renting platform Zumper. While this increase in renting prices may be accessible to Fordham students, they are not accessible to the general public in this community. Fordham University is ranked seventy-second in the nation for expenses and tuition prices. Therefore it can be presumed that those attending this university have more expendable income than that in the Belmont community.
Outside of the direct renting by college students, there is also an impact on the total price to buy homes. They have become more expensive in these areas due to the push for investors to buy these homes for the sole purpose of renting them to college students. In fact, in an analysis done by Ryan Rivas, Dinesh Patil, and Vagelis Hristidis from the University of California, they determined that “renting a home near a university has a slightly lower correlation (to price) compared to the sale of a home, implying a higher demand for buying a home. This may be accounted for by sales to investors for the purposes of renting out these homes” (Rivas et al. 21). They also determined, after analyzing several different ZIP codes where universities were and were not present, that “ZIP codes with universities tend to have above average median home price and median rent” (Rivas et al. 22). Although this study was done on the effects of universities and hospitals on the housing market, it defines these two variables separately. From this, conclusions on university impacts can be drawn. Their study shows a clear correlation between housing prices and their proximity to universities. They do this by calculating average home prices and their distance from small, medium, and large universities. It can be concluded from their study that there is an effect on the cost of buying houses and that universities do not solely affect the renting market in these areas.
This is not to imply that renting price is not changed by a university’s presence. In fact, in many cases of gentrified areas, it is renters that get pushed out of these neighborhoods faster than those who own their homes. This is especially true in cases of gentrification done by schools, when landlords deem it more profitable to have students as renters rather than long-term resident renters. When comparing the involuntary moves of renters as compared to homeowners in gentrified areas, Isaac William Martin and Kevin Beck of the University of California, San Diego, found that “A renter in a gentrifying neighborhood is more likely than another renter to move in any given biennial period and to report that the move was involuntary, by 2.6 percentage points […] With respect to homeowners, by contrast, the same method produces no evidence of displacement from gentrifying neighborhoods” (Martin and Beck 54). In this study, the percentage points are in reference to a unit of one percent, meaning that the 2.6 percentage points indicate that these renters are 2.6 percent more likely to declare their move involuntary in gentrified areas. This is in comparison to renters in non-gentrified areas because this percentage point is higher than 0.05, which is the scientific point in which data is significant; it can be determined that gentrification affects the number of voluntary and involuntary moves out of neighborhoods. This is especially interesting when compared to the insignificant findings of homeowners percentage points, proving that there is little impact on homeowners. This means that there is statistically significant evidence to prove that there is an impact on renters.
Because university proximity increases the home price, many people living near universities are more likely to be renters. Even though there may be a desire to become homeowners, it is not applicable in these areas because of the higher prices. This is evident when looking at the Belmont community; according to the NYU Furman Center, “the homeownership rate in Belmont/East Tremont was 5.1%, lower than the citywide share of 31.9%. The homeownership rate in the neighborhood has decreased by 2.3 percentage points since 2010” (2022). There was a statistically significant decrease in the number of homeowners in this community, even though the number of homeowners generally is already low, with 95% of the population being renters and 5% of the population being homeowners, according to the real estate platform, Zumper. Drawing from both these sources, the effect that universities have on the housing market not only deters people from becoming homeowners due to the correlation that universities have with the increase in average home price; it also causes those who are then forced to rent to be displaced at a higher rate due to the fact that renters are pushed out more frequently than homeowners, and in the case of universities, those who are taking their places are students.
On top of students moving off campus, many urban universities work with housing companies to negotiate off-campus student housing through the school, which can similarly affect the pricing of apartments in their area. Typically, this arrangement is made with little regard to how this may affect those living in the neighborhood beforehand. This can be observed through the idea of the “New Urban Crisis,” which is the modern version of the urban crisis, which was a period in history where there was a decline in manufacturing causing people to move from cities into suburbs. The new urban crisis has a similar structure as this previous crisis. However, it is mainly focused on the areas where urban universities cause inequality within these sectors of the city and push out the lower-income individuals living in these areas, leaving them at even more risk to the consequences of economic politics in these cities. From this, it is clear that “The New Urban Crisis has profound consequences for how urban universities consider and negotiate space in the context of expansion and their role as a neighbor in an increasingly unequal city” (Llano 37). This disregard for how the actions of the universities can have lasting effects on urban communities demonstrates how the relationship between these two entities is interconnected in more ways than simply existing in the same space. It also indicates the university’s role in the local and state economy and that these schools have become increasingly involved in capitalism inside and outside the gates.
Many consider urban universities an essential aspect of cities because they contribute to the local economies by introducing students to the businesses surrounding the schools. From this, the students can contribute financially to these businesses and, in many cases, keep them afloat in economic difficulties. Not only does the spending of college students contribute to the economy, but the ideas they present to the business communities surrounding them when employed through internships and jobs also help stir the economy. Interns provide these businesses with the minds to develop their aspirations for their company and allow for more innovation. This, in turn, expands the companies and therefore expands these businesses’ ability to be a part of the local economy. In fact, according to the Association of Public and Land-Grant Universities, “Urban serving institutions represent 68 percent of colleges and universities in the United States and serve 20 million students, making their campuses essential for implementing transformative change” (APLU). The number of urban universities make up the majority of the universities in the United States and therefore have the ability to impact the urban economies through both the spending aspect and the expansion of research ability in the businesses around them.
While these contributions may seem beneficial for these economies, they can also have many downfalls. Suppose students can buy from businesses. In that case, the industries surrounding these universities will raise their prices since they understand that the students can afford to spend more than the average city person living in this area could. This price hike makes it more difficult for those living in these areas and not attending the university due to the inflation of prices of necessary goods and services. These price increases can be detrimental to the community living there since it can make it nearly impossible to attain goods and services for livable or reasonable prices. In other cases, it is not the previously existing businesses that up their prices, as it can also be the implementation of new higher-priced venues built around these schools. Similar to how establishments such as Whole Foods are typically placed in higher-income neighborhoods, these types of businesses may enter college campuses, assuming that the students have the money to spend there. They do this even if the surrounding neighborhood outside the schools does not have this income.
In connection to this, the large chain store, Target, has been viewed as one of these businesses infiltrating the college-aged market. An article by reporter Corinne Ruff states, “The new small-format stores, which generally size between roughly 17,000–50,000 square feet, aim to target three key markets: urban centers, suburban areas, and college campuses” (Ruff 2017). Target has been known to be a store equivalent to Walmart, a considerably affordable store. However, their prices are still slightly higher than those of Walmart for goods such as groceries. These implementations around college campuses are the small but mighty force that raises prices to appeal to college students and not the community as a whole. In fact, a Target store recently opened this year blocks away from Fordham University, and from the data the article shows, it can be inferred that this opening was in hopes of gaining the sales of Rose Hill students.
This same concept applies to the ability of students at urban universities to increase the economic advancement of businesses they are employed by. Had these businesses not had the students available to work for them, they would likely need to hire more local people who could have the same effect on their business while also providing good jobs to these individuals. According to the Georgetown University Center on Education and the Workforce, “Close to 70% of all college students work while enrolled” (Kerr 2020). Whereas, in comparison to the general public employment rate, which was roughly 58% in the year 2021, this difference in college employment compared to the public employment rate is interesting because one would think that the public employment rate would be higher than those receiving an education, but it is, in fact, the opposite. This can indicate that jobs that could employ those who are unemployed, nearly half the population, could be dominated by the increased employment of college students. In both manners, this infiltration of college students into the economy takes away from those living in the urban areas by increasing the prices of goods around them to an unmanageable amount and taking away potential jobs.
Universities are contributing to the local economies and have become a sort of economy within themselves. Regardless of their proximity to urban areas, many universities have taken on the nature of a for-profit university. Chapman University defines this as “an institution that is privately run, and tuition money is often used for marketing and recruiting purposes rather than invested in the classroom and campus experience” (Beeck 2021). Because of this mentality, many universities are trying to make themselves more appealing to students to increase their population and simultaneously increase the amount of money they take in. This priority has become known as academic capitalism when universities are not only looking to educate students but also trying to gain capital. Academic capitalism can explain the desire for universities to continually expand and become more appealing to make it easier to increase student tuition. This can include modernizing buildings, establishing new buildings, increasing technological availability to students, creating more green spaces, etc. In fact, “As universities increasingly view students as consumers, they have created new dorms and recreational facilities to attract potential applicants. Furthermore, Austrian and Norton (2005) argue that universities expand to their urban neighborhoods to increase the university housing allotment for faculty” (Llano 39). This expansion connects to the increases in housing prices surrounding these schools.
The fact that universities are purposefully gaining capital demonstrates how truly disconnected these schools are from their communities. The efforts schools have put in to make their university more appealing via expansion indicate that they are solely looking for profit and are doing this through population and property increases. Without the desire to use this new profit to aid in the advancement of the school and surrounding community as a whole, the schools are examples of gentrifiers. This is in the sense that they only look for their betterment and avoid the repercussions that the community faces. They do this by displacing people and using their power and resources to make these changes seem good for their university’s betterment rather than acknowledge the hardships they have caused.
For universities to positively impact themselves and the community around them, they cannot solely focus on the betterment of their schools but rather include the community in their advancements. This can be done by including the surrounding area in their expansion plans, opening up their campus to the general public, or asking the community what they wish to receive from the university. The colleges can “[…] look for external opportunities to which these resources can be applied, or one can look to the external community to determine what needs exist to which the university can usefully respond” (Thompson and Lambel 61). This allows the school and the community to have a better relationship and understanding of what each party can do for the other instead of existing separately in the same space. Both parties benefit from interactions such as these and provide the students with a more inclusive environment both on and off campus. Without active engagement by the community and the university, there is a risk of increasing tensions between the two, brought about by the desire to bring good to one party without regard for the other. This can be summarized by Margaret O’Mara when she states, “Universities and cities simultaneously admire, mistrust, and misunderstand each other. Depending on time, place, economic conditions, and personal chemistry, the connection between locality and university can waver between wary goodwill and outright hostility, reflecting fundamentally different organizational structures and institutional purposes” (O’Mara 3). To minimize possible negative impact of these tensions, universities have an obligation to become more accessible and involved in the communities in the manner that the community desires.
This is especially prevalent in areas such as urban universities, which tend to be more widely disconnected from their surrounding area due to the more extreme economic separation between the two. In this case, the urban universities have even more responsibility to incorporate the community to ensure that the relationship maintains civility and is beneficial. There are many ways in which a university can contribute positively to its community. In fact, “The typical urban university performs multiple economic and social outreach functions, from extension programs to service-learning initiatives, technical assistance programs, and development of community infrastructure” (O’Mara 14). It is these forms of outreach that provide both resources to the people who do and do not attend the university. They provide access to certain materials that would otherwise be difficult to attain and give back to the people in their community. From this the two entities can form better relations so that when the community may be able to benefit the school, it will do so, and vice versa.
With the evidence provided in universities’ role in gentrifying the areas that they inhabit, in the roles that they have on the increase of prices in the housing market and the overall relationship of the community to the university, it is clear that there are necessary steps that universities must take to combat the negative impact that these effects can have. This is why it is their responsibility to support their campus community and the surrounding area by using their resources to engage with students and the public. By implementing these resources, universities can help reduce their impact on the gentrification of these places and be aware of their influence on the communities; from this, they can aim for betterment rather than allowing damaging effects to occur.
Works Cited
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About the Author
Mia Tero is a rising Sophomore at Fordham University Rose Hill College, where she is pre-law and plans on majoring in Communications. She is from Southern Maine and in her free time enjoys reading and volleyball. She values being engaged in the community and people around her, and was inspired to write this piece because of this.