IN THE CENTER of Boston rises the small neighborhood of Fort Hill, on top of which sits Highland Park, designed in the 1800s by Frederick Olmsted.1 Patriots stored gunpowder here during the Revolutionary War, and a tower fit for Rapunzel commemorates their efforts. The abolitionist writer William Lloyd Garrison fought against slavery from a house on this hill. And now the battle for urban housing affordability rages on these streets. It’s a microcosm of the battle playing out on a neighborhood level in every growing city in America: a battle between those who want to keep property values high, and those who want the chance to live in the cities that have the best economic prospects.
The casualties in this war are mostly the middle class. In 2016, rents continued their years-long rise, incomes stratified further, and the average price to buy a home in major US cities rose. The strain pushed the middle class out of cities like Boston, San Francisco, Los Angeles, New York, Austin—the so-called “hot cities.” Some families move to the suburbs. Others flee for less expensive cities. But across the US, the trend holds: cities are increasingly home to high-rollers who can pay the high rents or down payments and lower income people who qualify for subsidized housing.
Macroeconomists say this a good problem to have. These cities are growing. People want to live in them. Stagnating economies in the Rust Belt might envy this kind of trouble. From the perspective of the overall wealth of cities, the middle class being pushed out doesn’t matter. But it matters on the human level, the neighborhood level. In Fort Hill, it means that a teacher at the local elementary school cannot afford to live in the neighborhood where she works. The effects on inequality, mobility, and the demographic composition of cities are very real, their causes multifold, and the solutions difficult.
Experts reading into president-elect Donald Trump’s proposed tax and housing policies—including his appointment of Ben Carson to lead the Department of Housing and Urban Development—see little hope that the federal government will help reverse this course next year. If cities want to retain a middle class, experts say, they will have to make it happen on their own.
Out of Reach
The affordability crisis in US cities is not just about buying homes. Rents, too, have been rising since the Great Recession. In the coastal and hot cities like Denver and Austin, those increases have put even rentals out of reach for many in the middle class–defined as those making between $50 to $125,000 depending on household size. In 2016, the capital required to sign a lease on the average-priced $3,500-a-month apartment in San Francisco often topped $12,000, owing to requirements for first and last month’s rent plus security deposits and a broker fee.