Two stories on the theme of gentrification and displacement — a topic we at the Bay Guardian have expended plenty of ink on — ran in major news outlets recently, showing how intense the Bay Area housing market pressure has become as it continues to be fueled by a rapid growth in high-salaried jobs in big tech.
Zeroing in on San Francisco, the Los Angeles Times turned an eye toward Mission District gentrification ("San Francisco split by Silicon Valley's wealth," Aug. 14) illustrating the growing divide with a succinct comment overheard on a Muni bus: "I don't know why old people ride Muni. If I were old, I'd just take Uber."
And a Wall Street Journal article ("Companies spruce up neighborhoods, putting gentrification in overdrive," Aug. 13) provides an eye-opening account of how REO Homes LLC is seeking to accelerate the gentrification process by "beautifying" West Oakland, an historically African American neighborhood that is home to predominantly low-income and working-class residents.
Minutes from downtown San Francisco via BART, West Oakland is dotted with Victorians and was hit with a wave of foreclosure during the economic crash, destabilizing the lives of many families who lost their homes.
REO is an investment firm helped along by San Francisco billionaire Tom Steyer, a well-connected venture capitalist (he even hosted a Democratic Party fundraiser with President Barack Obama at his Pacific Heights mansion earlier this year).
As the Journal's Robbie Whelan reports, REO has been shelling out top dollar to spruce up not just its holdings, but residences nearby its West Oakland properties. In a rarely seen form of hyper-gentrification, the company has been planting trees, sprucing up homes (for free) of neighbors who aren't in the market to sell or rent, mending fences, and making other improvements — all in an effort to lure higher-income residents to the neighborhood.
Since 2008, the height of the real-estate market crash, REO has acquired more than 200 homes in Oakland, Whelan reports, mostly in West Oakland. "Most houses cost around $200,000," he writes, "and [founder Neill Sullivan] said he invests as much $100,000 to fix each one up."
Real-estate agents have been marketing the sometimes-rough neighborhood to house-hunters as an affordable, nearby alternative to astronomically expensive San Francisco. Now that many people who weren't able to keep up with mortgage payments have been forced out by foreclosure, things are changing swiftly, as if by magic. Armed with cash, bankers are chasing away the blight and rolling out the welcome mat for up-and-comers who can't swing that $3,000 one-bedroom in The City. All of which will likely result in further displacement of Oakland residents who are barely holding on as it is. As Oakland City Council member Desley Brooks told the Journal: "I'm not interested in finding housing for San Franciscans who can no longer afford San Francisco. I'm interested in helping people here in Oakland."