I'll try to explain the situation with the things that are happening in my city.
The city is a stable city in terms of expansion. It has a "mountain" an side, a river on the other, and some protected areas in another. So, leaves an few sides to were expand. But, even if that is an realitty, it has some free space to be used and to expand.
The problem is that, even if the city is evolving a steady and slower pace, the prices today go from 300 to 400 euros to rent and house. In an not that distante future, it was around 150 and 250 euros. That is just from an perspective of rentals. From the home buyers perspective, sadly I don't know much. I can't recall the past. The problem is that the things have gotten expensive. Even if the "evolution" have been smaller. The things that affected the price of the houses have been especulation, proximity to the capital, that has always been the same, with almost the same public transportation. It's just a matter of abstract concepts that got the prices higher.
Now, that's just the things that weren't made to the houses. Now, I have an house. I buy it, and it costs 100.000 euros. Ok, not bad. I go and start to make things like... and chimney, that adds to the value of the house. I go and change all the windows to an more efficient type, and the value rises again. Then, I go and install electric gates and solar and water collection facilities. The price of the house, goes up.
Ok, that in the short time won't affect people there. But, in time, the area will be seen as an more "higher class" place, and people will go there to live. It will expand the price even further, because of bigger demand. The houses will compete with each other, trying to be better. And the price will get higher and higher.
In an couple of time the all area will targeted with housing especulation.
That is what tends to happen in more rural areas. In the city, it's a change of local specifics. Either goes to turists or to commerce. Some old areas in Lisbon, if I'm not mistaken, some houses got an from 250 euros a month to 800. Just because the area, not that specific building, started to be an target for turists.
Others, got higher value just because that old street, started to got some attaction from high roller commerce, like Prada, Louis Vittoun (or what is it name xD), and the prices went crazy! And you see the place, and it's an stupid duality with the high value houses, and having homeless in the streets or junkies shooting up in an alley.
I think that people fear gentrification, because of this.
If the central or local government takes steps to try and control this speculation or this value spurt, to make things affordable to people.
