This opinion letter was originally published in the The Wall Street Journal. You can read the full piece on their website here, and you can read more about the impact of the 10-year tax abatement on Philadelphia’s revival in the Housing Center’s working paper here.

Noah Gould’s excellent account of Fishtown’s revival rightly emphasizes neighborhood renewal’s human side: “New Fish” arriving, “Old Fish” staying, and a once-struggling working-class neighborhood finding new life (“‘New Fish’ and ‘Old Fish’ Revive an Iconic Section of Philly’,” Cross Country, June 6). But the larger lesson lies in how Fishtown made a comeback: not through a master plan or top-down government program, but by making private investment feasible.

In the 1990s, Fishtown and Philadelphia saw little housing investment as demand flowed to the suburbs. The root cause was economics: Construction costs exceeded achievable sale prices, creating an appraisal gap that kept builders on the sidelines. The city’s 10-year residential property-tax abatement, expanded in 2000 to cover new construction citywide, supplied the “extra bump” that made deals work. By exempting improvements while continuing to tax land—and by making the abatement broad, automatic and predictable—the city let markets decide where demand justified new housing.

Development first took hold closer to Center City, where demand was strongest, then moved outward in the 2010s into adjacent rowhouse neighborhoods, including Fishtown, as property values rose and more infill projects became financially viable.

Read more at The Wall Street Journal.