The effects of gentrification are both good and bad. In my home city, there are four different types of gentrification on a chronological time scale:
The first is gentrification a la Society Hill. In the '50s, this neighborhood was one of the worst slums in Philadelphia; Ed Bacon oversaw a master plan to improve the area. But it's gone from one end of the economic pendulum clean to the other; now Society Hill is one of the most upper-class neighborhoods in the city, and an almost entirely residential one to boot (not that this is a bad thing: Society Hill has proximity to the traditional shopping district of South Street). Very few gentrified neighborhoods, I think, even have the possibility of doing what Society Hill did.
The second is a neighborhood that's been gentrifying for a long time, to the point where the excesses of gentrification outweigh the benefits. Manayunk is a good example of this. What was once a workingman's mill neighborhood was colonized by the gentrifiers in the '60s or '70s and has since gentrified into a neighborhood whose neighborhood retail consists of practically nothing but bars. It's been that way for some time, and since it's proximate to Chestnut Hill, one of the highest-class neighborhoods in the city, and it's become notorious as a college kids' hangout, I suspect it will stay the same for some time to come.
The third is a "gentrified" neighborhood that was a slum in living memory. Most of the recently gentrified neighborhoods around Center City, e.g., Fairmount, Franklin Town, the Northern Liberties, Fishtown, Queen Village, Bella Vista, Hawthorne, G-Ho, University City, and Powelton Village, all fall into that category. They've gentrified enough to be worthy places for living, but haven't yet lost the local quality that makes them unique; Northern Liberties is a particularly proud example of this: its new Liberties Walk development is filled with nothing but small mom-and-pop style stores.
The last is an "up-and-coming" neighborhood where the processes that drive gentrification can be seen to still be at work, places like Kensington, lower G-Ho, Brewerytown, Sharswood, Callowhill, Norris Square, and Germantown (and so forth); there are still lower-class elements in these neighborhoods, which actually makes them, in my opinion, more colorful (Norris Square BTW is trying to prove that the largest Hispanic neighborhood in the city can gentrify without needing to lose its Hispanic-ness). These are the neighborhoods that the "first type" of gentrifier previously mentioned tends to go for, whereas stable gentrified neighborhoods tend to be more the home of the "second type," more akin to the true yuppie.
One more question comes to mind: what will the fate of most these gentrified neighborhoods be? A select few, like Society Hill, can become enduring enclaves for the wealthy, but why do they do so in the first place? And what will happen in places like Manayunk, where gentrification has clearly run its course but other factors like its distance* from Chestnut Hill prevent it from progressing further? Will the neighborhoods become stable middle-class neighborhoods? Or is there a sort of anti-gentrification, a revolt against over-trendiness? Manayunk's placement and age makes it a perfect test bed to find out what lies in store for the future of gentrification.
*Manayunk is both proximate to and distant from Chestnut Hill because of the bordering effect of the Wissahickon Gorge; that is, it's just proximate enough to Chestnut Hill to gentrify in the first place, but too distant from Chestnut Hill to take the next step, becoming an upper-class enclave.