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From Disinvestment (Abandonment) to Reinvestment (Gentrification): Homefront’s Abandonment Analysis Thirty Years Later

July 24, 2004 by Administrator in Summer 2004

By Ann Meyerson and Tony Schuman

In March 1974, 200 housing and community activists attended a conference in New York City to confront the systematic destruction of low-rent housing caused by government urban renewal programs and expanding private institutions. An organization called Homefront: Citywide Action Group against Neighborhood Destruction and for Low-Rent Housing emerged from this conference to continue the fight to preserve neighborhoods and expand the declining stock of low-and moderate-rent housing, especially in working-class neighborhoods with large numbers of black, Latino and other oppressed minority residents. In 1977, Homefront produced a 140-page report, Housing Abandonment in New York City.

Many of Homefront’s assessments were on target and, when looked at in light of changing conditions, can help chart new strategies for progressive housing activists today.

An Explicit Anti-Capitalist Analysis
Unlike other housing organizations at the time, Homefront was explicitly anti-capitalist and socialist in its ideology. Its purpose was to:

… help provide analysis, coordination and a socialist political perspective for various tenant and community struggles…. Homefront feels that the real enemy is not the small landlord or even the developers. The underlying cause of all forms of community destruction is an economic system controlled by giant corporations and banks—capitalism. This system has only one purpose—to maximize profits based on private ownership of property…. Homefront maintains that the “housing problem” as such cannot be solved in isolation. It can only be solved within a socialist society, i.e., a society where decent housing, along with full and meaningful employment, adequate health care and all other human needs are considered the top priority. Building socialism in the US is a long-range process. As part of this process, Homefront recognizes the importance of developing and supporting short-range programs which address people’s immediate needs while demonstrating their connection to the capitalist system which created them. Our focus, however, is on those issues which most clearly attack the system of private ownership and financing of housing for profit.

Following the 1974 conference, Homefront set out to study the phenomenon of landlord abandonment of sound working-class rental housing. An estimated 150,000 units had been abandoned in New York City and entire neighborhoods were destroyed. People wanted to know why this was happening and what could be done about it. The two-year study outlined the key causes of abandonment, government and community responses to it and strategies for combating it. Homefront also published a pamphlet in 1975 with articles on hospital and commercial expansion, government-sponsored projects (highways, sports arenas, etc.) and the racist tipping point theory of why neighborhoods change demographically.

The Causes of Abandonment
In clarifying the role of bank finance in the profitability of residential real estate, and the impact of redlining by banks in particular, Homefront made a useful contribution to the public understanding of the causes behind the wave of housing abandonment that struck New York in the mid-to-late-1970s. People could understand the role of individual landlords in abandonment, but it wasn’t that clear why abandonment was taking place on such a large scale, wiping out whole sections of the city.

The abandonment report argued that rent control and the age of the building stock were not the cause of landlord abandonment, as the prevailing conventional wisdom held. Many relatively new buildings in good condition were being milked and abandoned by their owners, who stopped paying their real estate taxes and walked away. Furthermore, many heavily rent-controlled neighborhoods were not being abandoned. And there was widespread housing abandonment in other cities without any history of rent control.

The process, the report concluded, was a systemic one involving disinvestment and capital flight on the part of financial institutions on which landlords depended to realize their return on investment. The report showed that landlords generally do not make most of their profit from cash flow based on rental income. Rather, they make most of their profit by refinancing their mortgages, allowing them to take their built-up equity out of their properties. Banks decided that they would no longer lend in certain neighborhoods (which were redlined) and instead moved their investments out-of-state and into non-real estate sectors. Landlords then did the logical thing: They cut back on maintenance of their properties to gain the maximum profit as quickly as possible and then walked away, leaving the city of New York to own and operate the buildings.

Banks, mortgage and insurance companies redlined neighborhoods as their mostly white, working-class populations followed jobs and housing investment to the suburbs. In the throes of a “fiscal crisis,” New York City adopted a de facto racist policy of “planned shrinkage” that cut back services in these neighborhoods. At the same time the national government under President Richard Nixon declared an end to the War on Poverty and federal aid to cities.

Thirty years later, we can see the Homefront report as prescient. It cited abandonment as “one aspect of the uneven development of capitalism, bound to be followed in the long run by neighborhood redevelopment for profit.” Many of the neighborhoods in the city today that are experiencing intense gentrification are those that were once plagued by landlord abandonment.

On the strategy front, the report criticized the self-help efforts to cooperatively own and operate abandoned housing that were widely advocated at the time. “Self-help strategies put all the responsibility on individuals who are the victims of abandonment rather than on the capitalist system and government which causes it. In practical terms, the main problem with self-help is that it is usually too costly for people with modest incomes.”

Instead, Homefront saw the expanding stock of abandoned and therefore city-owned housing as a critical opportunity to achieve the goal of “publicly-owned, tenant-controlled housing,” where the government would assume responsibility to rehabilitate and maintain this housing. This flew in the face of the city policy, still operative today, of turning over abandoned properties to private developers, even the worst slumlords, on the premise that only the private sector should provide housing. Homefront said, instead, that “our aim is to promote programs that move toward public ownership of low-rent housing and attack the system of private financing, production and ownership.”

At that time, Homefront and the left in general were heavily influenced by the successful national liberation movements around the world, the growth of the socialist left in Europe and détente with the Soviet Union. This led to strong views about the limitations of capitalism and the possibilities of socialist development:

There cannot be real tenant control of housing under capitalism. Publicly-owned housing with tenant control can’t solve the root problems that spring from a capitalist system….Genuine solutions to housing decline are not possible under capitalism. This strategy, therefore, is aimed at strengthening the movement for socialism. It exposes the rule of capitalism and the role of government. It puts responsibility for abandonment where it belongs, and increases the ability of people to struggle.

Response to the Report at the Time
The report was generally well-received. As one neighborhood activist commented, “When it comes to housing, we’re all socialists.” But when it came time to discuss next steps, many local leaders demurred. “We don’t have time for this kind of citywide action,” they explained. “We’re too busy trying to deal with these thirty families in an abandoned building.”

Some academic commentators were less receptive, and Homefront was accused of being a bunch of remote academics pushing a “statist” line. It is certainly true that Homefront called for public resources and responsibility for addressing housing needs (public ownership with tenant control). We debated internally whether to advocate for an expansion of public housing or some other form of public ownership. But Homefront was never an organization of mostly academics. It was an amalgam of activists and professionals, and the report was a good example of activist scholarship. Its members, including many who worked on the abandonment report, took part in campaigns to stop the auction of city-owned properties and the cutbacks in city services in low-income communities.

The city continued to auction properties back to the private sector and many of new city programs aimed at converting renters into homeowners but without the necessary financial and technical resources to help them succeed in this new role. So Homefront played a leadership role in a citywide “Stop the Auctions” campaign featuring demonstrations at Police headquarters, site of the public auctions. Two Homefront veterans (Tom Gogan and Dave Robinson) organized the In Rem Tenants Coalition to unite tenants in city-owned buildings.

Homefront dissolved itself in the early 1980s as people returned to their first commitments and continued their activism through other venues.

Changes since the 1970s
Much has changed since the abandonment report was first issued in 1977. The left and social movements have been retreating. At the local level, displacement through abandonment, arson and demolition have been supplanted by displacement through gentrification and redevelopment, as Homefront predicted. Community groups that were focused on neighborhood organizing gradually became community development corporations, providing substantial amounts of new housing but losing the sense of a citywide movement around broader housing issues. The very language of the housing movement changed. Its goal now became “affordable” housing, not “subsidized” housing. This was accompanied by a shift in focus from rental housing for low-income households to homeownership opportunities for moderate-income working families. The term “affordable” glossed over the necessity of substantial subsidies to bring the purchase price of housing into range for even two-income working families. Nowhere is this shift more pronounced than in the Hope VI program that encourages the demolition of rental public housing units and their replacement by mixed-income homeowner rowhouses. In New York City, one of the major new housing production programs was a public-private partnership that put one-, two- and three-family homes on publicly-owned vacant land where low-cost rental housing had been abandoned and demolished.

In the last decade, the city has also lost a significant number of moderately-priced housing units in limited equity co-ops. Expiring restrictions on rents and resale prices offered one-time bonanzas for co-op owners who could capture the market value of their limited equity apartments. These units have been taken out of the dwindling affordable housing stock. For renters in private units, the gutting of rent regulations under pressure from the real estate industry has jacked up rents throughout the city. In the suburbs, exclusionary land use and zoning practices continue to limit opportunities for new low-cost housing. With all of these changes, homelessness has become a regular part of the housing scene since the 1980s. Overall, one thing that hasn’t changed in the past thirty years is the concentration of the urban poor in central cities (and some inner-ring suburbs) and the intersection of poverty and race that make urban ghettos a continuing challenge to the cause of social justice.

The Homefront Report in Hindsight
Certainly the brightest outcome of the housing movement in the 1970s and 1980s was the emergence of experienced and committed local development organizations. Although some of these expanded too quickly and crashed and burned under the weight of their inexperience and, occasionally, the egotism of some leaders, others became critical outposts in holding the line against gentrification or in maintaining viable pockets of neighborhood life in the midst of devastated neighborhoods. Following the Homefront session at the conference, housing consultant (and charter member of PN) Emily Achtenberg offered the following reflection on Homefront’s analysis:

In one sense, we can argue that Homefront’s critique of the in rem tenant co-op programs for failing to achieve public ownership was correct, insofar as some of these buildings (with lapsed restrictions) now have opportunities to cash out in gentrifying markets, and others face significant risks of disinvestment/tax foreclosure as tenant incomes erode. But the majority still seem to be working as affordable, non-speculative housing, and in that sense Homefront failed to give credit to the massive transfer from private to social ownership—broadly defined—that was accomplished by these programs, on a scale unprecedented (before or since) in any US city. On the Williamsburg tour [a PN conference workshop], we visited an in rem co-op that was impressively well-maintained, democratically run, affordable and closely linked to the local non-profit support organization. We learned about neighborhood-wide networks of in rem co-ops working to extend tax relief in exchange for continuing use restrictions. These social ownership forms are by no means perfect, but do seem like a step in the right direction. Today, activists and planners should be working to save and improve them. With hindsight, perhaps Homefront should have been less rigid in its prescription and more open to the notion of “radical reforms” that further the concept of social housing while exposing the limitations of what can be accomplished under current conditions.

This is a fair critique. The Williamsburg building, and larger-scale efforts like the Cooper Square Mutual Housing Association on the Lower East Side, which manages hundreds of apartments, are important examples of social ownership in the non-profit sector. We would certainly have to abandon any “statist” notions that socially-owned housing must be government-owned. In almost all cases, however, these projects would not be accessible to low-income tenants if the land hadn’t been publicly owned and conveyed to the non-profit sponsors at little or no cost. The Cooper Square buildings are owned by a land trust that requires that the housing be used for low-income tenants in perpetuity. It is more important that the land and housing be under the control of tenants and owners who can’t sell them for a profit than it is for them to be in the hands of government. This is the way to make sure the housing remains affordable.

Since Homefront, Ann Meyerson directed NYU’s Metropolitan Studies Program where she taught courses on housing and urban development. She is currently the curator of exhibitions at the Brooklyn Historical Society, having shifted from teaching urban studies to interpreting urban history. Shortly after working on the Homefront report,Tony Schuman began teaching at the New Jersey School of Architecture (NJIT), where he currently directs the graduate program. A founding member of PN, Tony’s teaching and writing are focused on housing and urban development from a design and policy perspective.Others who participated in producing the Homefront report were: Tom Angotti, Debbie Bell, Almuth David, Tom Gogan, Dan Gutman, Eileen Murray, Mimi Rosenberg and Phil Weitzman. We are sorry to say that the Homefront report was produced before the digital days and copies of the report are only available in some local libraries.

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Planners Network is an association of professionals, activists, academics, and students involved in physical, social, economic, and environmental planning in urban and rural areas, who promote fundamental change in our political and economic systems.

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