Last in line: Housing assistance for households with children

Abstract

This article examines the relationship between receipt of different types of rental housing assistance and housing outcomes for households with children. We rely on the 1989 American Housing Survey (AHS) and a special data supplement that attempted to accurately categorize every assisted renter‐occupied address in the AHS sample as either public housing; privately owned, federally assisted housing; or certificates and vouchers. Housing outcomes examined are physical condition of the unit, crowding, affordability, perceived neighborhood quality, and crime. We analyze three research questions: (1) Do the characteristics of households enrolled in housing programs differ by program type? (2) Do housing outcomes differ with the type of assistance received? (3) Do differences in household characteristics account for observed differences in program outcomes?

The analysis suggests that the housing assistance system channels different types of households with children into different housing programs. The least disadvantaged households are most likely to end up in privately owned assisted stock, while the most disadvantaged end up in public housing. The most notable interprogram difference in housing outcomes relates to neighborhood quality. In contrast to other forms of rental assistance, residence in public housing is associated with a decline in neighborhood quality. This result holds even after controlling for household characteristics and geographic location of the unit.     

Where the homeless come from: A study of the prior address distribution of families admitted to public shelters in New York City and Philadelphia

Abstract

This study investigates hypotheses regarding the association of census tract variables with the risk for homelessness. We used prior address information reported by families entering emergency shelters in two large U.S. cities to characterize the nature ofthat distribution.

Three dense clusters of homeless origins were found in Philadelphia and three in New York City, accounting for 67 percent and 61 percent of shelter admissions and revealing that homeless families’ prior addresses are more highly concentrated than the poverty distribution in both cities. The rate of shelter admission is strongly and positively related to the concentration of poor, African‐American, and female‐headed households with young children in a neighborhood. It is also correlated with fewer youth, elderly, and immigrants. Such areas have higher rates of unemployment and labor force nonpartici‐pation, more housing crowding, more abandonment, higher rates of vacancy, and higher rent‐to‐income ratios than other areas.     

Neighborhood Opportunity and Location Affordability for Low-Income Renter Families

Abstract

We use the Location Affordability Index (LAI) and the newly developed Child Opportunity Index (COI) to assess, for the first time, the tradeoff between neighborhood opportunity and housing/transportation affordability facing low-income renter families in the 100 largest metropolitan areas. In addition to describing the opportunity/affordability relationship, we explore the level of balance between neighborhoods’ relative cost burden and their corresponding opportunity levels to determine whether children of different racial/ethnic groups are more (or less) likely to experience cost-opportunity imbalance. Our multilevel analyses show that housing affordability is largely accounted for by the neighborhood opportunity structure within each metropolitan area. The metropolitan characteristics examined account for only a small proportion of the between-metro variance in the opportunity/affordability gradient for housing, presumably because the neighborhood opportunity structure already reflects metro area factors such as fragmentation and segregation. On the other hand, transportation affordability shows a weaker association with neighborhood opportunity. The COI/LAI association is much weaker for transportation than for housing, and a large part of the variation in the transportation gradient occurs at the metropolitan area level, not the neighborhood level. Sprawl is particularly associated with transportation affordability, with lower sprawl areas having lower transportation-cost burden. We discuss the implications of the empirical findings for defining affordability in housing assistance programs. We recommend that housing policy for low-income renter families adopt an expanded notion of affordability (housing, transportation, and opportunity) and explicitly consider equity (e.g. cost-opportunity imbalance) in the implementation of this expanded affordability definition.     

House poor in Los Angeles: examining patterns of housing-induced poverty by race,nativity, and legal status

Housing affordability in the United States is generally operationalized using the ratio approach, with those allocating more than thirty percent of income to shelter costs considered to have housing affordability challenges. Alternative standards have been developed that focus on residual income, whether income remaining after housing expenditures is sufficient to meet non-housing needs. This study employs Los Angeles Family and Neighborhood Survey data to consider racial/ethnic, nativity and legal status differences in one residual income standard. Logistic regression analyses of housing-induced poverty focus on whether there are differences among five distinct groups: US born Latinos, Non-Hispanic Whites, and African Americans, authorized Latino immigrants, and unauthorized Latino immigrants. Results suggest that: (1) Latino natives are significantly more likely to be in housing-induced poverty than African Americans and Latino immigrants, and (2) unauthorized Latino immigrants are not more likely to experience the outcome than other groups. The present work extends previous research. First, the results provide additional evidence of the value of operationalizing housing affordability using a residual income standard. Alternatives to the ratio approach deserve more empirical attention from a wider range of scholars and policymakers interested in housing affordability. Second, housing scholarship to date generally differentiates among Latinos by ethnicity, nativity, and citizenship. The present study contributes to emerging research investigating heterogeneity among Latinos by nativity and legal status.     

Housing Affordability and Child Well-Being

We test three hypotheses about the role of housing affordability in child cognitive achievement, behavior, and health. Using longitudinal data from the Panel Study of Income Dynamics, we apply both propensity-score matching and instrumental-variable modeling as identification strategies and test the sensitivity of results to omitted variable bias. The analysis reveals an inverted-U-shaped relation between the fraction of income devoted to housing and cognitive achievement. The inflection point at approximately 30% supports the long-standing rule-of-thumb definition of affordable housing. There is no evidence of affordability effects on behavior or health.     

Where Does Location Affordability Drive Residential Mobility? An Analysis of Origin and Destination Communities

Abstract

Despite an overall decrease in residential mobility after the 2007 housing crisis, many households, particularly those that are low income, continue to move in pursuit of a better life. Traditional theories of residential mobility suggest that mobility will occur when housing and transportation costs are cumulatively greater than the cost of moving to a new location. At the same time, the influence of these factors is not likely to be uniform across geographic contexts or for moves up or down the metropolitan hierarchy. Our analysis examines how well affordability measures explain patterns of county-level residential mobility. Specifically, we contrast conventional measures of affordability focused on the ratio of income to housing expense with measures of location affordability that factor in both housing and transportation costs. We find that whereas households tend to move from lower to higher cost locations, transit affordability at the destination plays an important role in mobility decisions.     

Housing Subsidies and Early Childhood Development: A Comprehensive Review of Policies and Demonstration Projects

ABSTRACT

In this article, we ask how housing subsidies might influence young children. We examine two national housing policies – public housing assistance and the Section 8 vouchers program – and two demonstration projects that aimed to improve the administration of providing housing subsidies – HOPE (Homeownership Opportunities for People Everywhere) VI and Moving to Opportunity. This article is a critical examination of these policies and demonstration projects in relation to the following housing dimensions that promote the healthy development of young children: income supplements residential stability, physical environment, access to services and amenities, housing choice, neighborhood safety, and social capital. We compared advantages and limitations of each of these national housing policies and demonstration projects and examined ways in which they might influence children in these housing dimensions. The article concludes with implications and future research directions for U.S. housing policy by discussing its most recent U.S. Department of Housing and Urban Development (HUD) initiative, Rental Assistance Demonstration, in addressing limitations of housing policies and demonstration projects we examined.     

Housing Choice Vouchers and Crime in Charlotte,NC

Recent media attention and research have focused on the effect of housing vouchers on crime, with different conclusions. The purpose of this study is to bring further evidence to the voucher–crime debate, using annual data from 2000 to 2009 for Charlotte-Mecklenburg County. We study the relationship between crime counts and housing vouchers with quantile regression models with year and census tract fixed effects. We found that voucher households are associated with increased crime, controlling for past crime levels. Estimates vary, however, with the concentration of vouchers in the neighborhood, with little impact in areas with low concentrations. Estimates also vary with the neighborhood crime level. We extend the literature by examining the effect of different voucher family types, finding no evidence that elderly households or nonelderly households without disabilities and without children are associated with more crime. However, we found a very significant positive association for nonelderly households without disabilities with children. Our results indicate that significant crime reductions could be accomplished by focusing U.S. Department of Housing and Urban Development, local housing agency, and criminal justice resources on the types of places and voucher families most at risk for crime problems when a family uses a voucher to move into a new neighborhood.     

Economic Prosperity and Housing Affordability in the United States: Lessons from the Booming 1990s

The United States is facing an acute shortage of reasonably priced housing with over 35% of households paying more than 30% of their income for housing costs in 2015. As the U.S. economy recovers from the Great Recession, will housing become less unaffordable as incomes rise and households could potentially pay a lower share of their income for housing costs? To see if this is likely, I examined the change in housing affordability in the 100 largest metropolitan statistical areas (MSAs) in the United States between 1990 and 2000, a period of exceptional economic prosperity. I used the percentage of housing cost-burdened households (those that pay more than 30% of their gross income on ownership or rental costs) as a measure of the availability of reasonably priced housing. I used discriminant analysis techniques to detect statistically significant differences in the percentage of cost-burdened households in the 100 MSAs based on a variety of factors. I found that despite the phenomenal economic prosperity of the 1990s, about 30% of households were cost-burdened both in 1990 and 2000. High MSA median income was correlated with a greater shortage of reasonably priced housing. Neither economic growth rate nor poverty rate nor population growth rate distinguished high-shortage MSAs from low-shortage ones. Large MSAs and MSAs in the West had greater shortages than other MSAs. Economic prosperity did not alleviate the problem of lack of reasonably priced housing in the past, and is not likely to do so in the near future. Planners and policy-makers need to enact new policies at local, regional, state, and federal levels to effectively address America’s chronic affordable housing shortage.     

Comment on Jack Goodman's “houses,apartments, and the incidence of property taxes”

Abstract

Goodman finds from his analysis of the 2001 Residential Finance Survey that multifamily housing bears a higher effective property tax rate (EPTR) than single‐family owner‐occupied housing and argues that much of the differential is associated with the lower average property value of apartments. We offer comments on how this important research can be enhanced and analyze the EPTR by using a different database, the Public Use Microdata Sample (PUMS) of the decennial census.

Like Goodman, we find from the PUMS that the EPTR of multifamily housing is high relative to that of single‐family detached housing and that lower‐value multifamily housing has a higher EPTR relative to that of higher‐value multifamily units. We offer preliminary findings from the PUMS on the implications of the EPTR for development patterns (it may discourage smart growth), equity (the poor and minorities bear a higher tax burden), and housing (high EPTRs challenge affordability).     

Why Are Houses More Affordable in France?

It is not surprising that houses are more affordable in France than in Britain. Even the Barker Report proposes taxing builders, and the UK's record should be a source of shame. France has constructed roughly 150-200 per cent more housing than the United Kingdom for the last 40 years, incentivising construction by fiscal measures and by the institutional environment, including favouring social housing. Spain has substantial recent construction which on its own may not produce affordability, with little social housing. Construction aids can be of relatively low cost and produce affordable homes, but this can reduce the funds available to assist the very poor.     

Nonpoor children in head start: Explanations and implications

According to the Head Start Act (1998), children are income‐eligible for the program if their “families' incomes are below the poverty line.” There are a number of statutory exceptions to this general rule and, according to the Head Start Bureau, the result is that about 6 percent of the children in the program are not poor. But the major national surveys of Head Start families report that 30 percent or more of Head Start children are not “poor.” This paper confirms and explains the high proportion of nonpoor children in Head Start: at enrollment, at least 28 percent are not poor; at midyear, at least 32 percent are not poor; and by the end of the program year, at least 34 percent and perhaps more than 50 percent are not poor. Although the presence of some of these nonpoor children seems to be an appropriate or at least understandable aspect of running a national program with Head Start's current organizational structure, the presence of others seems much less warranted and raises substantial questions of horizontal equity. Moreover, taken together, the large number of nonpoor children suggests that the program is not well targeted to fulfill its mission of providing compensatory services to developmentally disadvantaged children—and reveals the essential ambiguity of Head Start's role in the wider world of early care and education. The income and program dynamics that have led to so many nonpoor children being in Head Start are also at work in many other programs, and, thus, our findings demonstrate the need to understand better how income eligibility is determined across various means‐tested programs.     

Evaluating the Concept of Location Affordability: Recent Data on the Relationship Between Transportation,Housing, and Urban Form

The concept of location affordability holds that housing affordability should be augmented to include transportation cost as a related and substantial household cost burden. The recent United States foreclosure crisis of 2006–2008 offers an opportunity to evaluate location affordability as a concept for policy and practice by investigating the relationship between transportation cost burdens and negative housing outcomes. This article contributes to the growing literature on location affordability and the recent crisis with an analysis of default and foreclosure data for 70 metropolitan areas. The analysis includes transportation and housing cost burdens and demographic data, as well as multidimensional measures of urban form. High rates of automobility are associated with increased foreclosure. The urban form variables yield mixed results, suggesting the relationship between urban sprawl and affordability is complex. However, across a range of specifications, high levels of development intensity are associated with increased foreclosure rates. The results have implications for both the housing and transportation sectors and lend support for the notion of location affordability.     

The Changing Relationship Between Housing and Inequality, 1980–2010

Inequality in both income and wealth has grown rapidly in the United States since the 1970s. Over the same period, homeownership rates increased in step with expansionist government policies and the development of subprime and other exotic loan products, and housing affordability challenges emerged as the most prevalent housing problem for owners and renters alike. The subprime lending and foreclosure crises of the 2000s stretched households financially, threatening the traditional economic benefits of homeownership, bringing into stark relief the ways in which housing and inequality mutually influence one another, and implicating homeownership, housing affordability, and subprime lending in the widening gap between the rich and the poor. This article examines the changing roles of homeownership, housing affordability, and subprime lending in contemporary U.S. inequality by, first, describing trends in county inequality and housing characteristics and, second, modeling inequality as a function of the previous decade's housing characteristics over the period of 1980–2010. We build upon past models of county inequality by more explicitly considering causal order, place characteristics, and state and regional fixed effects. The results confirm that homeownership, affordability, and subprime lending not only reflect existing inequalities but also perpetuate those inequalities over time. Homeownership promotes equality, affordability problems undermine it, and subprime lending has the potential to ameliorate inequality in certain contexts, but these effects shift significantly over time, particularly as a result of widespread foreclosures and economic recession. Our analysis establishes the importance of housing in explaining contemporary inequality, highlights how place characteristics and causal ordering may improve county inequality models, and provides a foundation for future studies examining inequality in light of the Great Recession and the foreclosure crisis.     

Economic shifts and the changing homeownership trajectory

Abstract

From 1980 to 1988, homeownership rates declined substantially for the first time in the postwar era. They stabilized and began to creep upward during the 1988–94 period. After presenting a long‐term perspective, this article describes and examines two of the underlying forces of this upswing—demographic aging and improved levels of affordability—as well as the impact of immigration and minority lags. Fundamental economic factors are then surveyed: national and regional housing price shifts, housing production cycles, measures of housing affordability, and employment. Several key economic parameters of the post‐recession housing market are presented as a guide to the short‐term future.

Post‐1988 homeownership rates initially rose because of an aging demography. But gradually, the new affordability became part of the dynamic. The new affordability was driven by the decade‐long slowdown and weakening of housing prices, lower post‐recession interest rates, and accelerated job creation following the period of “jobless” economic growth.     

Addressing the Affordable Housing Crisis for Vulnerable Renters: Insights From Broward County on an Affordable Housing Acquisition Tool

South Florida is experiencing an affordable rental crisis that is especially burdensome on those most vulnerable in society, low-income households. Rapid urbanization has resulted in inequitable land-use patterns that are a barrier to housing for the poor. As a solution to the crisis, local housing agencies seek to expand their affordable housing stock for vulnerable renters in opportunity-rich neighborhoods, but there is no standard framework for identifying properties for acquisition. Broward County serves as a case study to develop a housing acquisition tool. Using a combination of spatial statistics and principal components analysis, neighborhoods in which housing agencies may consider acquiring property are identified through the creation of an affordability surface in ArcGIS. Affordability is overlain by an opportunity surface derived from neighborhood quality and accessibility rankings. The results identify neighborhoods in Broward County that are both affordable and opportunity-rich, to better serve the county's most vulnerable renters.     

The long‐term effects of public housing on self‐sufficiency

Recent years have witnessed an intensification of the debate about the fundamental purpose of public assistance to the poor and the effects of these programs on children. This study uses enriched data from the Panel Study of Income Dynamics to examine the effects of living in public housing as a child at some point between 1968 and 1982 on four young adult outcomes: welfare receipt; individual earnings; household earnings relative to the federal poverty line; and employment. Living in public housing during childhood increased employment, raised earnings, and reduced welfare use, but had no effect on household earnings relative to the poverty line. The beneficial effects could have arisen because public housing improved physical living conditions, reduced residential mobility, or enabled families to spend more of their income on items that benefit children's development. Whether these effects apply to contemporary public housing is unknown. © 2002 by the Association for Public Policy Analysis and Management.     

Preservation of existing housing: A key element in a revitalized national housing policy

Abstract

A key aspect of the continuing housing policy debate is how best to spend limited resources to aid the poor. Recently, the policy has focused on whether it is more effective to intervene on the supply side via provision of a voucher or rental certificate that enables a low‐income household to secure decent housing in the private market.

This paper argues that preserving and maintaining the affordability of the remaining stock of unsubsidized low‐cost housing will require a skillful balancing of supply‐and demand‐side interventions. Exclusive reliance on vouchers will not do the job, especially since large segments of the poor do not receive any form of housing assistance. Flexible programs to expand the purchasing power of poverty‐level households must be developed.     

A profile of children with disabilities receiving SSI: highlights from the National Survey of SSI Children and Families

This article provides a nationally representative profile of noninstitutionalized children 0 to 17 years of age who were receiving support from the Supplemental Security Income (SSI) program because of a disability. To assess the role of the SSI program in providing assistance to low-income children with disabilities and their families, it is important to obtain detailed information on demographic characteristics, income and assets, health and disabilities, and health care utilization. Yet administrative records of the Social Security Administration do not contain many of the relevant data items, and the records provide only an incomplete picture of the family relationships affecting the lives of children with disabilities. The National Survey of SSI Children and Families fills this gap. This summary article is based on survey interviews conducted between July 2001 and June 2002 and provides some highlights characterizing children with disabilities who were receiving SSI and their families. Most children receiving SSI (hereafter referred to as "SSI children") lived in a family headed by a single mother, and less than one in three lived with both parents. A very high proportion, about half, were living in a household with at least one other individual reported to have had a disability. About 70 percent of children received some kind of special education. SSI support was the most important source of family income, with earnings a close second. On average, SSI payments accounted for nearly half of the income for the children's families, and earnings accounted for almost 40 percent. When all sources of family income were considered, slightly more than half (54 percent) of SSI children lived in families above the poverty threshold, a notable fact given that the federal SSI program guarantees only a subpoverty level of income. However, beyond these averages there was substantial variation, with some children living in families with income well below the poverty threshold and others having income well over 200 percent of the poverty threshold. About one-third of SSI children lived in families owning a home, two-thirds lived with parents or guardians with at least one car, and about 40 percent lived with parents or guardians with zero liquid assets. Less than 4 percent lived with adults who owned stocks, mutual funds, notes, certificates of deposit, or savings bonds. The Social Security Administration's administrative records contain only a limited amount of information about disability diagnoses. The National Survey of SSI Children and Families supplements those records with data from an array of questions on functional limitations, self-reported health, and the perceived severity of disabilities. The data suggest that a great degree of variation in severity exists within the childhood caseload, as reflected in reports of the presence or absence of six functional limitations, perceived overall health status, and perceived impact of disability on the child's ability to do things. Overall, 36 percent of the children were reported to have had disabilities that affected their abilities to do things "a great deal," and for 21 percent their difficulties had very little or no impact. Physical disabilities were most common among children aged 0 to 5, and mental disabilities dominated the picture for the other two age groups: 6 to 12 and 13 to 17. Virtually all SSI children are covered by some form of health insurance, with Medicaid being by far the most common source of health insurance coverage. Just as in the case of the severity of disabilities, substantial variation was reported in health care utilization among SSI children. Almost 30 percent of children had two or fewer doctor visits during the 12 months preceding the interview, and close to 50 percent had five or more doctor visits. About four-fifths of the children had no reported hospitalizations or surgeries during the previous year. More than 40 percent of the children visited an emergency room during the previous year, most of them more than once. Importantly, no out-of-pocket costs associated with medical care were reported for more than two-thirds of the children, and only about 3 percent had annual expenses exceeding $1,000 for physical and mental health care. This finding suggests that SSI payments are not used to cover medical expenses for the overwhelming majority of children. The use of supportive therapies varied widely among SSI children: more than half reported having used physical, occupational, or speech therapy; only 8 percent used respite care for the parents or other family members. An analysis of the perception of the survey respondents shows that more than one-third of children had unmet needs for mental health counseling services, and about three-quarters of families had unmet needs for respite care. In several service categories, the proportion perceived to have had unmet service needs was around 10 percent or less. In the dominant service category of physical, occupational, and speech therapy, only 11 percent perceived to have had unmet service needs.     

Untangling Housing Cost and Transportation Interactions: The Location Affordability Index Model—Version 2 (LAIM2)

Abstract

It is now accepted that to have an understanding of housing affordability one must consider not only housing costs, but also the transportation costs associated with that household location. To make this information readily accessible to the public, the United States government created an Internet resource, the Location Affordability Portal – Version 2 (www.locationaffordability.info), to provide housing and transportation costs for every neighborhood in all 50 states and the District of Columbia. Although the statistical model at the heart of this resource was designed for predictive accuracy, its design and parameter estimates can provide additional insights into the interaction of housing cost and transportation choices (and thus its cost). This study describes the development and explores the policy implications (and limitations) of this structural equations model, the Location Affordability Index Model – Version 2 (LAIM2).