Wednesday 11 November 2015

Intergenerational support shaping residential trajectories: young people leaving home in a gentrifying city

Cody Hochstenbach & Willem R. Boterman
University of Amsterdam, The Netherlands
Across many different urban contexts, young people are currently faced with increasing constraints on the housing market. Inflating housing prices and stricter mortgage lending criteria render homeownership out of reach for more and more young people who, increasingly dependent on temporary employment contracts, are unable to acquire a mortgage at all. Consequently,  increasing numbers of young people are unable to leave the parental home. Those who do manage to leave the parental home are increasingly dependent on expensive and/or temporary rental housing. Hence, the notion of an emerging “Generation Rent” has been gaining traction in the UK.
It has frequently been highlighted that parental support, in both financial and non-financial ways, may improve young people’s housing market position. Parents may help to buy a place for their offspring or cover (part of) their rental costs. Furthermore, they can provide useful social networks or broker housing in other ways – giving their offspring a head start on the housing market. Consequently, inequalities are transmitted across generations.
The impact of the intergenerational transmission of inequalities on neighbourhood outcomes is not often studied however. This is an important omission in terms of understanding inequalities in the formation of residential trajectories in relation to urban space.  
In recent years the population of Amsterdam has grown substantially, in part due to an increasing influx of students and the retention of recent graduates. These trends, combined with the housing choices of middle-class families already present in the city, have played a pivotal role in the gentrification of Amsterdam’s inner ring (a process which local authorities have been happy to accommodate and further stimulate). Simultaneously, the outer ring areas have increasingly  become sites where poverty concentrations are increasing.
In our study we  have investigated the extent to which parental support and broader class background play a role in forging young people’s neighbourhood outcomes. We particularly focused on young people leaving the parental home – a key moment in the life course and the gradual transition towards independence and adulthood.
The findings are quite striking: young people with “wealthy” parents overwhelmingly move to Amsterdam’s inner-ring neighbourhoods (see the maps). These are predominantly either high-status and expensive neighbourhoods (the Canal Belt and the affluent Old South (marked with an F) being good examples), or gentrifying neighbourhoods – including neighbourhoods of already mature gentrification like De Jordaan (G), or the hip De Pijp neighbourhood (H). Young people from relatively poor backgrounds mainly move to the city’s outer ring areas (A, B, and C in the maps), often post-war extensions to the city characterized by a relatively low status. These patterns hold when controlling for a range of personal characteristics,  including income.
While the housing outcomes of young people may be the result of financial support, they also reflect broader processes of social reproduction involving social and cultural forms of capital. Facilitating their children to move into inner-ring neighbourhoods – often in relation to participation in education – is a key strategy in this regard,– making David Harvey’s work on residential differentiation highly pertinent to understanding processes of change affecting Amsterdam neighbourhoods.
The choices being effected by the children of middle class families in the Amsterdam housing market have impacted neighbourhood gentrification, and have contributed to  processes of displacement and exclusion. Young people from middle class backgrounds – despite their typically low incomes – are not only able to outbid other young people from poorer backgrounds, but can also be considered the (potential) carriers of parental wealth into previously poor (gentrifying) areas. Intergenerational wealth transfers can allow young people to pay otherwise unaffordable rents or are part of parental investment strategies in housing in areas where returns are relatively high. In such ways can parental wealth effectively be put to use to outbid other households and household types, contributing to their exclusion or displacement and ultimately advancing the gentrification process.

Source: Hochstenbach & Boterman (2015); own adaptation of CBS/SSB data.

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