What We Learned about Residential Instability in the Bay Area

Housing costs in the Bay Area have consistently been among the highest in the country, placing a heavy burden on the region’s low- and moderate-income people. In our recent report, we examine the moves of individuals in the region over time from 2002–2018, so we could better understand moving patterns by socioeconomic status (SES) due to housing unaffordability and gentrification.

Employing data on mobility from the Federal Reserve Bank of New York’s Consumer Credit Panel/Equifax Data, we found that low- and moderate-SES residents in the Bay Area have faced complex tradeoffs related to their housing. These findings have implications for equitable recovery in the region as we begin to emerge from the pandemic-induced recession.

Here are some key findings from our research.

Many Bay Area residents faced residential instability during our study period.

Constrained housing choices are often not captured in studies examining gentrification and displacement. We expanded our scope beyond simply examining whether people move and found a wider set of concerns: low-SES people disproportionately moved out of the Bay Area all together, and moderate- and middle-SES people disproportionately moved out of their neighborhoods. All but the most well-off people disproportionately moved to more crowded conditions, and low-SES people moved to increasingly fewer parts of the Bay Area over time. We refer to this set of wider constraints as residential instability. While it is outside our study’s scope, there is good reason to believe that housing choices became even more constrained during the COVID-19 crisis.

High moving rates before and during the Great Recession may have laid the groundwork for subsequent gentrification.

Based on typical patterns, we expected low-SES people to move the most. In fact, moderate- and middle-SES people moved the most and at higher rates than the national average. In addition, Bay Area residents moved more before and during the Great Recession than after it. These trends may reflect moves from foreclosures and financial insecurity that enabled gentrification in the later time periods. Over the study period, however, moving rates for low-SES people declined, which may reflect tenant protections or lack of affordable options.

Low- and moderate-SES movers were disproportionately more likely to leave the Bay Area than other movers.

When we tracked residents who lived in the Bay Area in 2009, we found that fewer than half of low-, moderate-, and middle-SES residents were in their same neighborhoods by 2018, compared to two-thirds of high-SES residents. Moves out of the Bay Area were higher for these three groups as well, as measured by the percentage of residents who remained in the Bay Area by SES. Among 2009 residents, 83.2% of low-SES, 81.7% of moderate-SES, and 84.7% of middle-SES were still in the Bay Area in 2018, compared to 90% of high-SES residents. When we looked at moves year by year, we also found that low- and moderate-SES movers disproportionately left the Bay Area.

Low-SES people moved out more from wealthier non-gentrifying communities and from other communities in the early stages of gentrification.

We expected to see low-SES movers leaving gentrifying areas (which by definition were previously lower-income areas). Instead, we found that low- and moderate-SES residents moved the most from wealthier suburban areas of the Bay Area and increasingly from the Bay Area’s outer areas. We also found that low-SES residents were more likely to move out of neighborhoods that were experiencing early signs of gentrification, rather than neighborhoods that would typically be considered gentrifying by traditional measures.

Except for those in the high-SES category, movers within the Bay Area were increasingly likely to move to more crowded housing over the study period.

This finding reflects an important tradeoff: people may be choosing more crowded conditions to stay in the places they call home, to maintain their sense of community and social networks, to ensure school stability for their children, and to remain close to economic opportunity (among other factors). In the later part of our study period, we found that low- and moderate-SES movers were most likely to move to crowded housing from neighborhoods that were gentrifying or experiencing early signs of gentrification.

Over time, low- and moderate-SES residents moved to increasingly fewer parts of the Bay Area.

Low- and moderate-SES residents generally moved to major cities and to dense, transit- accessible suburban areas. Maps of these trends suggest that fewer and fewer areas of the Bay Area remained accessible to low- and moderate-SES people over time.

Patterns of re-segregation seem to be emerging.

Low-SES movers moved to neighborhoods with higher poverty rates, poorer health outcomes, and more Black and Latinx residents compared to where higher-SES movers ended up. Taken together, these findings suggest patterns of re-segregation.

Our report highlights the importance of studying different dimensions of moves to better understand the constraints residents face. Our study has implications for policy and practice to support the well-being of individuals, households, communities, and the Bay Area on the whole, particularly as the region recovers from the COVID-19 crisis.

Findings from our study suggest the need for more expansive production and preservation of affordable housing in the Bay Area, especially in high opportunity areas. Our research shows a need for stronger tenant protections and support for low- and moderate-SES residents in particular. We also find that more supports for low-SES residents are needed in neighborhoods in the early stages of gentrification and in areas that may require more services as the low-income population increases.

Supporting housing that enables opportunity and good health for all Bay Area residents is critical to ensuring an equitable and prosperous region. It is especially pressing as we work toward an equitable pandemic recovery.

To learn more, read Constrained Choices: Gentrification, Housing Affordability, and Residential Instability in the Bay Area.

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The views expressed here do not necessarily reflect the views of the management of the Federal Reserve Bank of San Francisco or of the Board of Governors of the Federal Reserve System.

About the Authors
Jackelyn Hwang is a Visiting Scholar in Community Development at the Federal Reserve Bank of San Francisco and an Assistant Professor in the Department of Sociology at Stanford University. As a Visiting Scholar, Jackelyn works with the SF Fed’s Community Development team to examine gentrification and displacement in the Federal Reserve’s Twelfth District. Learn more about Jackelyn Hwang
Bina Patel Shrimali is Vice President of Community Development at the Federal Reserve Bank of San Francisco, which works to advance economic opportunity for low-income people and communities of color. She holds a Doctorate in Public Health from UC Berkeley. Learn more about Bina Patel Shrimali, DrPH