A frequent criticism of historic districts is that they convey sanitized versions of the past and that their creation is prompted more by the needs of present-day real estate values, the impulse to gentrify, or the urgent need to rehabilitate inner-city areas than by a desire to preserve the past. David Hamer claims that historic districts are best understood as part of the growth and development of urban communities -- examples of applied urban history that should be studied as such.
Hamer argues that four stages of history are represented by historic districts. The first is the history that the district actually embodies; the second is the story of what happened to the district from the time the historically significant events occurred until the present, when those events are judged to be significant; the third is the process leading to the district's classification as historic; and the fourth is the history of the district once the designation is official.