by Contributing Writer Mana Tahaie

In the first part of this series, we looked at the historical policies that created an economic system hostile to Black wealth creation. In this article, we will explore how discriminatory housing and development policies paved the way for gentrification in the Greenwood and Near North neighborhoods.

Gentrification

According to the National Community Reinvestment Coalition (NCRC), gentrification “happens when lower-income neighborhoods receive massive levels of new investment, adding amenities, raising home values and bringing in new upper-income residents. This can lead to cultural displacement when members of a racial or ethnic group who were longtime residents of gentrified neighborhoods are pushed out.”

As discussed in this series’ prior installment, the conditions for gentrification did not come about accidentally. For decades, a combination of legal housing discrimination, exclusionary redlining policies, and White flight systematically segregated people of color into urban neighborhoods where disinvestment resulted in crumbling infrastructure, highways severing and isolating the area, underfunded schools, few transportation options, and sparse public amenities. The impact was that cities exposed communities of color to higher rates of poor quality housing, pollution and toxins, policing, and violence. Furthermore, the housing stock in those neighborhoods consisted overwhelmingly of rentals, preventing residents from accumulating generational wealth through the country’s largest driver of middle-class prosperity: home equity. U.S. tax and economic policies favor homeowners and neighborhoods with owner-occupied houses, leaving renters behind when it comes to improving their financial conditions.

In later years, the pattern of public-private collaboration to deter and destroy Black wealth acquisition continued in the form of predatory lending, especially in the period leading to the Great Recession. Once locked out of obtaining mortgages, communities of color found themselves victims of subprime loans whose interest rates were above prime. A 2012 study of Oklahoma homeownership found that “when race and income are considered among borrowers, the data shows that all minority groups except Asians were denied loans more frequently than white borrowers even when these minorities had the same or comparable incomes.” The same study found that neighborhoods of color saw five times the rate of foreclosures as predominantly White neighborhoods. This represents a massive loss of wealth, with the downstream effect of inhibiting future access to credit. It also has a broader impact on Tulsa neighborhoods: foreclosed homes revert to bank ownership, leading to unoccupied properties that become dilapidated as code enforcement is difficult to enforce against lending institutions. The persistent number of vacant foreclosed homes in majority Black areas drives down the housing values of neighboring properties, so nearby homeowners also take a hit to their wealth.

In short, according to NCRC, “The economic outcomes for Black and Hispanic families residing in disinvested areas are often stunted by lower incomes, fewer businesses and fewer opportunities to build wealth. This history set the stage for gentrification and displacement.”

Wealth Depreciation

Houses do not have a static or objective value: they are worth what buyers will pay, which varies greatly within every community and often falls along racial lines. Research shows that homes in White neighborhoods are overvalued compared to similar properties in Black neighborhoods, even controlling for structural characteristics and neighborhood amenities. The national think tank Brookings Institution found that in Tulsa, the disparity results in a 40% lower home value for Black owners than their White counterparts. What this means is that in Black neighborhoods, homes have an average of $23,000 less value because of race-based devaluation. The economic implication for Black homeowners is significant: buying a house in a Black neighborhood will literally lose you money in the form of home equity.

Declining property values resulting from a mix of policies and prejudices are often the trigger for modern urban renewal practices in the name of “community development.” Case in point: the spring 2019 attempt by Tulsa Development Authority (once the Tulsa Urban Renewal Authority) to declare an area with thousands of North Tulsa properties blighted and subject to eminent domain. Efforts like these are clear examples of structural inequality, as government policies stunt access to regenerative assets for people of color, who pay the highest price for government disinvestment.

Displacement

People of color experience extreme displacement from their neighborhoods for multiple reasons. “Blight removal” and eminent domain policies forcibly remove residents from their communities. Faced with structural disinvestment, families who can afford to move to seek out safer, healthier, or better-resourced areas. In rapidly gentrifying areas, the pressure of increased property taxes or rent drives people from the neighborhoods they’ve lived in for generations. Residents who can afford to stay report getting harassed into selling by aggressive developers looking to profit from the increased demand for housing in the urban core. The economic result is that wealth accrues away from Tulsans of color who can’t pass down home equity to future generations and toward White Tulsans who have access to investment capital.

Beyond the economic impact, gentrification also leads to the degradation of neighborhood cohesion. So-called “revitalization” efforts imply that certain areas lack vitality, erasing the rich cultural legacy and contributions of the people who call those neighborhoods home. Displacement erodes the cultural fabric of communities of color, whose smaller populations find sanctuary in proximity. Additionally, dislocation contributes to community trauma, “as…many poor communities in affluent cities have been displaced to suburbs and smaller cities with fewer resources where the deteriorated quality of the physical environment is replicated. The pressures of gentrification and displacement have become an added element in the toxic stress that exacerbates community trauma in poor inner city and suburban communities.“

Lack of density also dilutes political power as residents are driven to outlying areas that lack the density of majority Black and brown neighborhoods. Without the geographic concentration needed to elect candidates who represent the community, people of color lose the critical voting bloc that supports a collective political voice.

White return

Earlier this year, New York Times reported on the phenomenon of “White return” following last century’s White flight:

At the start of the 21st century, these neighborhoods were relatively poor, and 80 percent of them were majority African-American. But as revived downtowns attract wealthier residents closer to the center city, recent white home buyers are arriving in these neighborhoods with incomes that are on average twice as high as that of their existing neighbors, and two-thirds higher than existing homeowners. And they are getting a majority of the mortgages.

In Tulsa, the pattern of “White return” is most evident in the urban core and surrounding neighborhoods, initially in the Tulsa Heights and Reservoir Hill neighborhoods, but more recently in the Greenwood, Pearl, and Kendall-Whittier districts. In April, New York Times illustrated neighborhood changes in racial demographics with the orange census tracts showing areas where the White population grew between 2000 and 2017:

Residents in the historic Tulsa Heights neighborhood, with the help of the Tulsa Development Authority, started courting developers in the late 1990s. Since then, 70% of mortgages have gone to White buyers, whose median incomes were 40% higher than the average Heights household:

Similarly, state and local policy publication Governing’s gentrification analysis found that median home values skyrocketed in Census Tract 6, which includes Lacy Park:

A look at recent home sales in near North neighborhoods shows hundreds of houses selling for three to four — and up to 29 — times higher than the previous sales price within the same calendar year. Surrounding North Tulsa neighborhoods are seeing the same pattern of houses shifting ownership to wealthy White owners under the guise of “easy commutes” and “diversity.” These properties are given the friendly label “fixer-upper,” neatly side-stepping the social implications of driving up property values and pushing out residents.

Restorative Policies 

The reality for too many Black Tulsans is a generational pattern of policies that have deprived them of opportunities to generate and pass on wealth. Gentrification is the latest iteration of this cycle, with city leaders, lenders, developers, and new residents cooperating — intentionally or otherwise — to drive Black Tulsans out of their native communities and destroy Black wealth in the process. The final installment of this series looks at policies that can help restore or reverse the damaging effects of these detrimental practices.

Photo credit: Joseph Rushmore