Question

How might increasing inequality and poverty be related to gentrification and homelessness? Explain your reasoning.

Answer 1

Homelessness is a condition where people are without a permanent dwelling like a house or apartment. Gentrification is the process of renovating or improving a house so it conforms to middle-class tastes.

With an ever-increasing population in the world and availability of increasing variety of material goods, we have witnessed a greater inequality of distribution of income. There are those who with their ambition have access to the greater share of income and then there is the vast majority who get the lower share of income. This inequality in the distribution of income along with growing population then starts giving rise to inequality of access not only to material goods but even basic needs such as food, clothing and permanent shelter (homelessness). With lack of access to basic amenities, starts the vicious cycle of inequality and poverty.

Homelessness means destitution. People taking shelter on the roadside, park benches, temporary shelter homes have no chance of ever competing with the mainstream population to improve their conditions. With the lack of permanency of shelter, how can an employment or an education be guaranteed? For grown-ups, it is the uncertainty of securing a permanent employment and for children, it the uncertainty of education. When these two uncertainties are combined, it further leads to greater inequality and poverty.

To support the above with statistics, from the European Journal of Homelessnees, between 1996-2000, Lifetime literal homelessness in the US was 6.2%, their share of income was 1.9% and social benefits and transfers as % of GDP was 10.6%. Same numbers for the UK was 7.7%, 2.1% and 15.6% respectively and for Germany was 2.4%, 3.2% and 20.5%.

According to Homelessness Australia Jan 2016, poverty is not just about the income a family is earning but also the denial of opportunity. The affordability and availability of housing have a significant impact on poverty. Home ownership can provide significant protection against poverty but increasing house prices and inequality of distribution of income is forcing more people out of their homes. Poverty is the underlying cause of homelessness.

Another cause of compounding the problem of inequality and poverty is gentrification. More and more higher-income people are moving from expensive neighbourhoods to lower-income neighbourhoods and purchasing properties. Similar sized-properties come much cheaper in the lower-income neighbourhoods. These then get renovated with higher-end amenities and services. Since the lower-income groups cannot afford these amenities, they are getting increasing priced out, leading to homelessness and greater poverty. This further feeds in the vicious cycle of inequality and poverty.