Comment on Elvin K. Wyly and Daniel J. Hammel's “Islands of Decay in Seas of Renewal: Housing Policy and the Resurgence of Gentrification”

Abstract

Gentrification ought to be examined, for policy purposes, as part of a general restructuring of the space of cities resulting from broader changes in the nature, location, control, and effects of economic processes. However, even if it is narrowly seen as simply residential change, as in the article by Wyly and Hammel, the displacement of poor households by an upper‐income gentry ought not be confused with the effort to mix moderate with low incomes in public housing through the best of HOPE VI.

Despite this confusion, Wyly and Hammel provide some interesting data showing the extent to which investment in inner‐city areas has accelerated in recent years, paralleling changes in financial arrangements and contradicting any notion that degentrification is a continuous, long‐term process. Their data, although short on demographic detail, also implicitly highlight the role of government in pushing the market to respond rationally to economic demand and the continuing danger that gentrification will displace African‐American families.     

Comment on Elvin K. Wyly and Daniel J. Hammel's “Islands of Decay in Seas of Renewal: Housing Policy and the Resurgence of Gentrication”

Abstract

Wyly and Hammel raise a number of important issues regarding the role of low‐income housing assistance in the more recent resurgence of inner‐city capital investment. However, their methodologies are found to be limited, and their results only weakly support a number of the strong conclusions they draw. Despite these limitations, Wyly and Hammel do present some interesting findings, such as greater loan denial rates for higher‐income applicants in the inner cities than in the suburbs, and raise the possibility of a changing income mix of urban gentrifiers. Building on the article's main theme, the comment suggests strategies to improve low‐income housing policy outcomes and highlights the gentrification conundrum.     

Comment on “Does the Likely Demographics of Affordable Housing Justify NIMBYism?”

Abstract

Automated underwriting (AU) systems have become the tool of choice in mortgage lending decisions. While these systems provide significant benefits to mortgage originators and investors, questions have been raised about their impact on underserved populations. The questions focus on the relative accuracy of AU compared with manual underwriting and whether AU has increased the flow of mortgage credit to underserved consumers.

Using information from Freddie Mac's Loan Prospector AU service, we provide statistics useful in examining these issues. The data strongly support our view that AU provides substantial benefits to consumers, particularly those at the margin of the underwriting decision. We find evidence that AU systems more accurately predict default than manual underwriters do. We also find evidence that this increased accuracy results in higher borrower approval rates, especially for underserved applicants.     

Daniel R. Hammond,Politics and Policy in China’s Social Assistance Reform; Providing for the Poor?

Journal of Chinese Political Science -     

Comment on Lawrence J. Vale's “beyond the problem projects paradigm: Defining and revitalizing ‘severely distressed’ public housing”

For several decades, manufactured housing has been a crucial source of affordable housing, particularly for rural areas. However, electricity consumption per unit area and per capita are substantially higher for manufactured housing units relative to site built, single-family detached units. This article uses data from the federal Residential Energy Consumption Survey (RECS) to examine patterns of electricity consumption in manufactured housing units over time and to draw comparisons with single-family detached housing units. Regression analysis is used to model annual electricity consumption for manufactured housing units in 1990 and 2005. Temporal trends in key predictors are discussed and contrasted with those for single-family detached units. Findings suggest that the most important predictors of electricity consumption are comparable across the housing types considered and that while manufactured housing units may be gaining in energy efficiency over time, consumption per unit area and per capita are increasing faster than in single-family detached units.     

Comment on Chester Hartman and David Robinson's “evictions: The hidden housing problem"—protection or protraction?

Abstract

Since the 1960s, judges and legislatures have made it increasingly difficult for landlords to evict tenants even in those instances where tenants have breached their leases. Sometimes, the growth of tenant protections has actually harmed law‐abiding tenants by raising costs to landlords and allowing rule‐breakers to remain in their apartments. Most landlords and tenants should want a system of laws that provides for both fair and efficient eviction procedures. Tenants should be entitled to legal representation when they are threatened with eviction, but their attorneys should not use the legal system to obtain free accommodations for their clients.

In the end, efforts to improve the housing of low‐ and moderate‐income households should rely not on setting up impediments to eviction, but rather on increasing tenants’ ability to afford housing and reducing the cost of housing development and operation.     

Comment on Jean L. Cummings and Denise DiPasquale's “The Low‐Income Housing Tax Credit: An Analysis of the First Ten Years”

Abstract

The Low‐Income Housing Tax Credit (housing credit) that Cummings and Di‐Pasquale portray is effective, efficient, and healthy. However, rapid changes in the industry have turned some of their data stale, and the absence of suitable context and information invalidate some key analyses and findings. Moreover, the researchers sometimes seem to see the glass as 10 percent empty instead of 90 percent full. A practitioners’ perspective is more positive.

The housing credit generates an array of public benefits while harnessing private investors’ business discipline. Genuinely low‐income tenants occupy the housing. The housing revitalizes low‐income communities. Properties are in good financial and physical condition. The housing credit is also cost effective. The economic fundamentals of producing low‐income rental housing, not the housing credit, necessitate substantial subsidies. A remarkably high proportion of the federal tax‐credit subsidy goes into the housing, and investor returns are modest. Nonprofit‐sponsored production appears to cost more because nonprofits are prominent in high‐cost locations and for other similar reasons, not because nonprofit developers are inefficient.     

Comment on Donald R. Haurin and Hazel A. Morrow‐Jones's “the impact of Real Estate Market knowledge on tenure choice: A comparison of black and white households”

Abstract

Haurin and Morrow‐Jones analyze a sample of survey respondents from Columbus, OH, and find that additional knowledge about real estate markets increases the likelihood of homeownership. They conclude that differences in real estate knowledge contribute importantly to explaining some of the racial gap in homeownership rates; this finding leads to their conclusion that the racial gap can be addressed through public policy interventions, including financial counseling programs.

Their research broadly addresses three questions: Why does the racial gap in homeownership exist? Why does it persist? What can be done to reduce it? We compare their findings with those of other researchers and conclude that improved financial literacy may well be an important tool for reducing the gap, but that the causes for its existence and persistence are complex and that improving financial literacy alone may not be sufficient to have a significant and lasting impact.     

Comment on Bruce J. Katz and Margery Austin Turner's “Who should run the housing voucher program? A reform proposal”

Abstract

There is much evidence that the housing voucher program has successfully met its two main goals: housing low‐income families and expanding housing opportunity. Nonetheless, efforts to address the program's limitations could improve success. We agree with Basgal and Villarreal that, on the subject of housing mobility, the focus of Katz and Turner is misplaced.

In addition to proposing a solution that does not address the problem, Katz and Turner fail to consider three key points: First, there is no consensus or clear definition of what “mobility” means, how it is measured, and what standard we hope to achieve. Second, the role and impact of family choice in the locational outcomes of voucher holders is a major factor. And third, the considerable trade‐offs in outcomes that result from a greater emphasis on mobility should be examined.     

Comment on Andrew S. Carron and R. Dan Brumbaugh,Jr.’s “The viability of the thrift industry”

Abstract

Krueckeberg summarizes Hernando de Soto's premise on property rights and offers a critical interpretation of de Soto's work, arguing that it emphasizes efficiency over equity and, ultimately, that enhanced property rights alone are unlikely to significantly improve housing stability or access to capital for households living in informal arrangements. I clarify several of Krueckeberg's discussions of de Soto's ideas from the perspective of the Institute for Liberty and Democracy (ILD).

The ILD perspective, informed by de Soto's writings, contrasts with Krueckeberg's in the following five areas: access to utilities and services in squatter settlements, the criminal nature of these communities, the ability of the poor to fulfill the responsibilities of formal ownership, their ability to borrow against formally owned property, and the impact of formalizing property on rental housing. I close by considering how the ILD perspective on formalization might be brought to bear in the United States.     

Comment on Charles C. Bohl's “New urbanism and the city: potential applications and implications for distressed inner‐city neighborhoods"—the politics of design: The new urbanists vs. the grass roots

Abstract

This article briefly reviews the origins of New Urbanism and its manifesto as emerging from the social change movements of the 1960s, which evolved out of ideas of a previous generation of American and European designers living through the rise of modern industrialization. Arising from the same turmoil of the 1960s, and parallel to the New Urbanists, evolved a more loosely affiliated network of progressive academic and practicing planners and architects who have aligned themselves with disenfranchised underclasses not benefiting from the wealth of the postwar era and who take direction not from a manifesto but from a body of thinking linked to a broader intellectual and political agenda. This group works primarily with grassroots organizations in lower‐income communities and intentionally stays out of the limelight to better serve its constituents. The article concludes with ideas for possible collaboration between these professional groups serving different ends of the socioeconomic spectrum.     

Comment on James E. Rosenbaum,Linda K. Stroh,and Cathy A. Flynn's “Lake Parc Place: A study of mixed‐income housing”

Abstract

Rosenbaum, Stroh, and Flynn confirm existing community leader perceptions that this model mixed‐income development in the predominantly low‐income South Side of Chicago has produced a positive residential environment. Increased tenant voice, not role modeling, seems to be a factor in producing increased resident satisfaction with the building and a strong sense of commitment to the mixed‐income alternative to exclusively low‐income housing projects. The extra resources invested in physical improvements and the extraordinary media attention paid to this model project may have created a “Hawthorne effect,” which also produced higher levels of satisfaction. The existence of this successful model is not sufficient to provide more housing alternatives; community‐based advocacy for more mixed‐income developments is needed.     

Comment on Sandra J. Newman and Ann B. Schnare's “'… And a suitable living environment’: The failure of housing programs to deliver on neighborhood quality”

Abstract

Newman and Schnare provide a useful portrait of where housing assistance ends up geographically. The evidence that certificate and voucher holders are less likely than public housing residents to live in the poorest neighborhoods is encouraging, as well as important for policy decisions. Unresolved in the article, and unresolvable with the data, as the authors themselves note, is the matter of how neighborhood quality is affected by housing assistance. The least popular housing developments have long been relegated to neighborhoods of least political resistance, a fact that constrains most local efforts to deconcentrate poverty. Futhermore, through the tax code, America spends about three times as much on housing assistance for middle‐ and upper‐income households as it does on assistance to low‐ and moderate‐income households. Thus far, we have not applied “fair share” principles either to the location of housing assistance or to its allocation across the income spectrum.     

Comment on Donald R. Haurin and Hazel A. Morrow‐Jones's “rhe impact of Real Estate Market knowledge on tenure choice: A comparison of black and white households”

Abstract

Racial differences in tenure have been large and persistent, with white householders much more likely to own their homes than blacks. Haurin and Morrow‐Jones surveyed a sample of 1,002 in metropolitan Columbus, OH, in 2005 to determine the causes of the tenure gap between blacks and whites.

Social and economic differences played a dominant role, but Haurin and Morrow‐Jones also identified a racial difference in real estate and financial knowledge, a difference they suggest could be reduced or eliminated with education. This comment raises questions about national homeownership goals and points out that Haurin and Morrow‐Jones overlook the consequences of pervasive racial residential segregation and the effects of both past and current discrimination.     

Comment on Dennis P. Culhane et al.’s “Testing a typology of family homelessness based on patterns of public shelter utilization in four U.S. jurisdictions: Implications for policy and program planning”

Abstract

A comprehensive typology of homeless families would help us understand how to provide services and supports appropriate to particular subgroups. In their attempt to establish such a typology, Culhane and his colleagues employ administrative data sets to correlate shelter use with behavioral indicators. These data sets are limited in that they fail to incorporate the complex, intense, and sometimes traumatic experiences that characterize the lives of homeless families, causing this study to fall short of what is required to create an accurate typology.

Among the areas overlooked by this approach are the high levels of traumatic stress and violence in the lives of homeless families, children's needs, and the interactions between parents and children. When only limited research is available, there is a danger that even modest findings will be used to support broad policy directions. Further research is needed to arrive at a defensible typology.