By Dr. Mark Mussman
It may come of no surprise to find out that Cincinnati is on stolen land, built atop pre-historic cultural sites, including mounds built to signify many (unknown) things, and that we made a concerted effort to destroy the livelihood of those who lived here for thousands upon thousands of years. In the rush for colonization, the white federal government deemed Native Americans as non-human, Black people as property, and immigrants as not-worthy of civic life. So, it is no surprise that the colonial mindset still lives on today.
Cincinnati is willing to sell itself to the highest bidder, no matter the influence on the current residents. We have been recently called out as an "eviction-friendly" and pro-development place by an international investor. This is substantiated by the thousands of residents who have been pushed from their homes each year over the past decade, and the many thousands more whose future is uncertain. It is also proven by our policies, such as tax abatement, which was created solely to attract outside investment into Cincinnati. While abatement has been derided as racist and possibly unnecessary, it is granted to everyone who asks, virtually without exception. Piled on top of these policies is another level of concern: the continued use of white supremacist ideology in City Hall. Simply put, without an acute eye on the impact of race, and more specifically anti-Black racism in Cincinnati, the calls for economic measures based upon theories of supply and demand in housing, for instance, bare witness to an administration that is willing to throw out its own Black residents to increase the earnings tax: an act we've seen time and time again. These anti-Black policies, coupled with an aging housing stock and relatively-low property acquisition costs, has made Cincinnati a new market for housing flippers.
Racial discrimination in housing never ended, it is just no longer directly supported by the courts; however, in banking and lending, real estate and leasing, anti-Black racism is still a feature, not a by-product. From redlining to predatory lending, Black families have never had a fair chance, and there has never been a fair, or level, playing field. Unfortunately, with the influx of influence from international investment firms, the playing field has tipped even further towards injustice. Injustice leads to displacement, and displacement leads to less stable communities. Less stable communities lead to disinvestment and hyper policing, further cementing the cycle of violence against Black people.
In the background, the cost of living is increasing and the level of debt each Cincinnatian accrues rises. The average rent in Cincinnati is over $1000/month, and energy usage is rising due to climate change, creating more costs. In addition to housing costs, transportation, education, and healthcare are putting us further into debt. Public housing isn't an option, as it has been underfunding for generations and is not able to keep up with the demand, and people are excluded due to arcane rules. Public housing is also being privatized through RAD (the Rental Assistance Demonstration Program), which is spearheading privatization at Pinecrest, Stanley Rowe, and Liberty Street Apartments, among other properties. And on top of all this, private equity investors are bringing millions of dollars to turn affordable housing into market-rate housing, forcing families from their homes, neighborhoods, and ultimately from Cincinnati altogether.
We didn't just get to this point with investor-friendly policies in City Hall, but also with the help of the federal government, who incentivized the use of hedge funds to purchase large numbers of foreclosed properties following the 2008 housing crisis. Under this program, hundreds of thousands of properties were consolidated into large portfolios that were up for grabs to investors. Investors believed that they could use their cash on hand to make the necessary capital investments into distressed properties to stabilize communities hardest hit by the foreclosure wave following the predatory lending that led up to the 2008 housing crisis. They also claimed that investors would be more likely to respond faster to resident concerns, like maintenance, and they would be better at leveraging funds to sustain their investments. As a result, homeownership rates fell sharply, and the built-to-rent market was born.
The goal of these types of real estate hedge funds and international commercial real estate investment firms is to create a permanent income stream for their investors. Large firms sought cost-saving measures, such as the standardization of appliances and HVAC systems, but also creating call-centers for resident concerns, and developing separate LLC's to manage the resident relations and maintenance. According to some residents, these cost-saving measures have given rise to conditions of absentee landlords and slum-like conditions, as investment portfolios are growing faster than property management and maintenance capabilities. In the end, however, the objective of these firms is to make as much money as they can, which in turn, results in affordable housing being turned into market-rate, or luxury housing, and the city giving them incentives to do so.
As the rental market grows, these investment firms merge and conglomerate, creating more power within specific areas to increase rents and to ensure their shareholders get the best return. They have even created at least one lobbying group, the National Rental Housing Council, which makes spurious claims that their existence hasn't impacted the housing market, even though they are able to purchase properties with cash above asking price, knocking out any potential family buyers, who can not compete with such offers. Ultimately, as they institutionalize the single-family rental market, families are not afforded the same opportunities as previous generations to create generational wealth through homeownership.
With the exception of the Port Authority, which is not a hedge fund, who acquired property in neighborhoods like Evanston, where Black homeownership rates were the highest before 2008, Cincinnati didn't see much of the hedge fund influence following the housing crisis of 2008, mainly because of our aging housing stock. Simply put, investors were not interested in buying old properties that needed a lot of work, they were looking for housing stock less than 20 years old. Unfortunately, that is changing rapidly today.
A recent example of international real estate investors purchasing properties in Cincinnati, with the expressed intent of turning multifamily properties from affordable to luxury, can be seen with Vision and Beyond. You may have heard about the long-term tenants who have received pressure to leave their homes on Court Street. These residents have spoken at City Hall, worked with organizers at the Homeless Coalition, and have even held a rally to support their homes. In addition to explicitly heralding their plan to turn affordable housing into market and luxury housing, Vision and Beyond has also been accused of neglecting their properties and their residents. In the case of Court View, Vision and Beyond refused to meet with the tenant organization, stating they would only meet with individual tenants. At City Hall, Vision and Beyond representatives claimed that they would work with tenants, but insisted that they would need to move out as soon as possible, so that the conversion to luxury housing could commence. One of their co-founders revelled in the idea that Cincinnati is eviction-friendly, and that typical barriers (such as tenant-rights) wouldn't hold their investors back from making money. The co-founder also talked about how Cincinnati is a business-friendly city, and that he feels confident that investing in Cincinnati, and neighboring communities, like Columbus and Lexington, would prove immensely lucrative for his international investors.
Ultimately, we are to blame for this. Residual colonialism is evident in our policies and practices. Whether we are forcibly removing people from their homes in the name of progress for international investors, or we are creating and sustaining policies that could be equated to genocide, without adequate housing protections, Cincinnati has become the next housing frontier.