Affordability After Subsidies: Understanding the Trajectories of Former Assisted Housing in Florida

Each year, thousands of units are lost from the assisted rental housing inventory through deterioration and default, subsidy expiration, and market-rate conversion. While a good deal of research and data collection has focused on identifying at-risk developments, less is known about what happens to former assisted developments after they exit income and rent restrictions. This article uses a survey of former assisted properties in Florida to identify their postsubsidy trajectories—that is, as to whether developments continue as rental housing, are converted to condominiums, or leave the housing stock through vacancy and demolition; and for those that continue as rental housing, whether they continue to offer affordable rents. Using logistic regression models, the article examines the property, housing market, and neighborhood characteristics that determine these trajectories. The results show that smaller properties, those that have been out of subsidy programs longer, and those in stronger neighborhood housing markets are more likely to be converted to condominiums. Among developments that continue as rental housing, those that previously had more stringent rent restrictions, those in strong rental submarkets, and those with better transit access tend to become unaffordable compared with previous rent limits.     

Housing Affordability and Health: Evidence From New York City

It is generally understood that households make tradeoffs between housing costs and other living expenses. In this article, we examine the relationship between health-related outcomes and housing-induced financial burdens for renters in one of the most expensive cities in the world, New York, New York. Drawing from the Housing Vacancy Survey for 2011, a representative survey conducted by the U.S. Census Bureau of more than 16,000 households in New York City, we estimate the effect of housing cost burden on the overall health of renters and the extent to which they have postponed various types of medical services for financial reasons. Results show that higher out-of-pocket rent burdens are associated with worse self-reported health conditions and a higher likelihood to postpone medical services for financial reasons. This relationship is particularly strong for those households with severe rent burdens. In addition, housing cost burden is equally or more important than other physical housing characteristics in explaining the variation in self-reported general health status and health care postponement. These findings are robust across specifications with different degrees of household, unit/building, and neighborhood controls, and among longstanding and newer renters. Our findings point to the importance of considering health-related outcomes when designing housing policies, and that housing subsidies should target both renters' out-of-pocket costs and place-based repair and maintenance.     

Challenges in the Creation of Mixed-Use Affordable Housing: Measuring and Explaining Its Limited Prevalence

ABSTRACT

Mixed-use affordable housing buildings collocate residences and commercial uses. The Low-Income Housing Tax Credit (LIHTC) program provides one mechanism to fund such structures. But the literature offers little insight into the frequency of mixed-use LIHTC buildings, partly because of a lack of data identifying them, and it does not pinpoint conditions that facilitate their development. I explore these issues through a Chicago, Illinois, case study. First, I analyze imagery to create the first database of mixed-use LIHTC buildings. I show that only 5% of LIHTC structures incorporate commercial uses, and that these are concentrated in wealthier, whiter, and already retail-heavy neighborhoods. Second, I use stakeholder interviews to explain the low rate and selective location of mixed-use projects; I find that the stiffest barriers are conflicting governmental policies, difficulties securing financing in the context of a perception of weak retail demand and investor desires for reliable returns, and design constraints.     

Work Requirements in Public Housing: Impacts on Tenant Employment and Evictions

In recent years, many have debated adopting work requirements in the public housing program, and a limited number of public housing agencies (PHA) have implemented these policies through the flexibility provided by the Moving to Work program. One such agency—the Charlotte Housing Authority (CHA)—has implemented a work requirement across five (of 15) public housing developments that mandates households to work 15 hr weekly or face sanctions. This article evaluates this policy and presents the first empirical analysis on the outcomes of a work requirement on employment and evictions. We find that, following work requirement enforcement, the percentage of impacted households paying minimum rent (a proxy for nonemployment) decreased versus a comparison group. Analysis of additional data on both employment and hours worked indicates similar results regarding employment gains, but no increase in average hours worked. We find no evidence that work requirement sanctions increased evictions, and very modest evidence that enforcement increased the rate of positive move-outs such as moves to unsubsidized housing.     

Housing for an Aging Population

We use the American Housing Survey to examine the distribution and occupancy of homes that have, or could be modified to have, accessibility features that allow seniors to successfully remain in the community as they age. Despite the aging population and the growing need for accessible housing, the U.S. housing stock is woefully inadequate: fewer than 4% of housing units could be considered livable by people with moderate mobility difficulties, and a miniscule fraction are wheelchair accessible. Recent construction is no more likely to be accessible than homes built in the mid-1990s, suggesting that the housing market is not responding to the aging demographic profile. Only a small fraction of seniors, even among those with mobility difficulties, and even among recent movers, live in suitable homes. Modifications that potentially improve accessibility are more likely undertaken by households with a senior, but only once that senior develops mobility difficulties.     

The Effect of Microneighborhood Conditions on Adult Educational Attainment in a Subsidized Housing Intervention

The ACHIEVEability model of affordable housing aims to promote self-sufficiency by requiring enrollment in postsecondary education in exchange for subsidized housing. In this study, we exploit the quasi random assignment of ACHIEVEability participants (N = 84) to subsidized housing units to evaluate whether microneighborhood environments moderated participants’ progress in postsecondary education. Participants progressed in their educational pursuits in line with program requirements, earning about 12 college credits per year. Neighborhood block group characteristics moderated this progress. Participants who were assigned to housing located in poorer, more violent, and less educated block groups earned credits at a significantly slower rate than participants assigned housing in more advantaged block groups. Our results suggest that the micro environments immediately surrounding residents of subsidized housing matter, even if they are situated within broader contexts of spatial and personal disadvantage.     

Second-Generation Policy Priorities for Colonias and Informal Settlements in Texas

Along the Texas border with Mexico, more than 400,000 people live in over 2,000 informal self-help settlements known as colonias. These exceedingly low-income, largely Latino settlements have historically suffered from severe health risks, poor infrastructure and housing conditions, and physical and social isolation. Researchers and policymakers have focused extensively on what I call “first-generation policy priorities.” This has primarily entailed efforts to regularize title and infrastructure, support self-help home improvement for colonia homeowners, and prevent the growth of new informal settlements along the border region. I provide a comprehensive review of existing research on colonias to document the myriad ways in which housing and infrastructure conditions and titling practices have changed since these settlements first proliferated throughout the border region in the second half of the 20th century. These changes necessitate a rethinking of the policy priorities for colonias and informal settlements throughout the state. In particular, I argue that colonias must be recast to recognize the significant improvements that have taken place but also the long-term and sometimes severe problems that persist. These “second-generation policy priorities” include the development of sustainable forms of governance, regulation, and finance to address ongoing infrastructure investment needs in colonias; supporting access to and upkeep of safe and affordable renter- and owner-occupied housing through both self-help and contractor-led projects; ensuring long-term title clarity; and promoting community organizing in new and aging settlements.     

Housing vouchers in the United States,great Britain,and the Netherlands: Current issues and future perspectives

Abstract

We compare the current U.S. housing voucher program with the British housing benefit and the Dutch housing allowance programs. After presenting the theory behind income‐related housing support, which underpins both the U.S. and European systems, we compare the three programs with respect to their scope (the budgeted versus the entitlement approach), the relationship between housing support and rent levels, the poverty trap, moral hazards, and administrative problems.

The United States can learn from Great Britain and the Netherlands that a full entitlement program can best promote equity, but given the present political and economic climate, it is unlikely that Congress will adopt such a program anytime soon. Great Britain and the Netherlands can learn from the United States how to design a more efficient tenant subsidy program, one that provides incentives to find less expensive units and promotes family self‐sufficiency through enhanced job‐seeking behavior.     

Race and Assisted Housing

This article explores racial disparities between assisted housing outcomes of black and white and white households with children. We compare the assisted housing occupied by black and white households with children, and examine whether young adult education, employment, and earnings outcomes in 2011 differ between blacks and whites who spent part of their childhood in assisted housing in the 2000s. We use a special version of the Panel Study of Income Dynamics (PSID) that has been address-matched to federally assisted housing, and the PSID’s Transition to Adulthood supplement, along with geocode-matched data from the U.S. Census Bureau, American Community Survey (ACS), CoreLogic real estate data, and U.S. Department of Housing and Urban Development (HUD). Statistical methods include difference in means, logit and general linear models. We find no evidence of racial disparities in the type of assisted housing program, the physical quality of project-based developments, or the management of public housing developments in the 2000 decade. But black households with children are more likely to live in assisted housing that is located in poorer quality neighborhoods. Multivariate tests reveal that the worse outcomes of black young adults compared with whites disappear once socioeconomic differences are taken into account. The discrepancy in assisted housing neighborhood quality experienced by black and white children makes no additional contribution to predicting young adult outcomes. Nonetheless, black children living in relatively better assisted housing neighborhoods tend to have better outcomes in young adulthood than those who live in poorer quality assisted housing neighborhoods. We discuss sources of racial disparity in neighborhood quality, and the policies enacted and proposed to address it.     

Neighborhood Housing Resilience: Examining Changes in Foreclosed Homes During the U.S. Housing Recovery

ABSTRACT

The surge in foreclosures in the United States that began in 2007 reached a peak in mid-2011, and since then, the rate of foreclosures has been decreasing, providing evidence of the housing market recovery. This study examines factors that affected changes in ZIP code-level foreclosure rates in more than 300 U.S. metropolitan areas during the national housing recovery. Using multivariate analyses of the long- and short-term effects of foreclosures simultaneously, this finding shows that certain characteristics of the mortgage and housing markets led to more rapid neighborhood recovery. Results also indicate, however, that most urban-form variables led to neighborhood resilience over the long term, that high shares of mixed land use were strongly associated with fewer foreclosures, and that high shares of auto dependency were associated with high foreclosure rates. Finally, findings suggest that low- and moderate-income neighborhoods, particularly in cities, were more vulnerable and less resilient to economic shock, and the accumulated effects of foreclosures worsened over the long term. However, low- and moderate-income neighborhoods surrounded by suburban affluent neighborhoods recovered more rapidly than those in cities did. Understanding such resilience to economic crises will provide policymakers with insights that they can leverage to establish housing policies for sustainable neighborhoods.     

Housing needs and effective policies in high‐tech metropolitan economies

Abstract

What are the most effective ways to provide low‐income housing to those left behind in new economy housing markets? Do winners and losers in high‐tech competition require federal housing strategies geared to metropolitan differences? This article examines 45 large metropolitan areas grouped along a high‐tech spectrum to see who is dis‐advantaged and to deduce effective local low‐income housing strategies from market characteristics.

Finding affordable housing was, on average, more difficult for low‐income renters and owners in high‐tech economies in the 1990s. Nonetheless, high‐tech metropolitan economies, like other local/regional markets, vary greatly. Sharp differences among and within metropolitan markets make it essential that federal strategies allow local policies to respond to local conditions. To most effectively provide low‐income housing to those left behind in all markets, federal policy should target sufficient resources to severe housing needs through many more vouchers and programs that permit and encourage effective local choices.     

A new look at creative finance

Abstract

In his seminal work, Stegman contended that creative finance is an inefficient means of financing low‐income housing production. As evidence, he cited the high transaction costs associated with the complex financing structures that make a low‐income housing development feasible. In this article, we extend Stegman's work by examining the impacts of creative finance over time. We rely on data gathered as part of an evaluation of 36 housing developments sponsored by nonprofits.

The data indicate that most of the developments in our study remained financially viable in part because of their reliance on creative finance. We find evidence supporting three positive impacts of creative finance: the establishment of long‐term partnerships, the increased community acceptance of low‐income housing developments, and the improved technical skills of organization staff. We also find that none of the long‐term negative impacts are inherent in creative finance and offer four suggestions on minimizing them.     

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.     

Interpreting the dynamics of public housing: Cultural and rational choice explanations

Abstract

This article uses culture of poverty and rational choice theories of poverty to explain how quickly nonelderly household heads leave public housing. Data from the Panel Study of Income Dynamics serve as the basis for the analysis.

Although a significant proportion of all household heads have public housing spells lasting five or more years, the majority have spells lasting less than five years. The availability of other housing options has a strong impact on how quickly individuals move out of public housing. Family structure and human capital play a more modest role. To the extent that one's childhood experiences affect the likelihood of exiting public housing, they appear to do so mostly through their effect on the acquisition of human capital. Finally, the evidence presented is inconsistent with the notion that public housing is a trap from which it is more difficult to escape the longer one lives in it.     

Future Prospects for Public Housing in the United States: Lessons From the Rental Assistance Demonstration Program

This article provides an overview of the Rental Assistance Demonstration (RAD) program in the United States and examines its early implementation from its start in 2013 through April 6, 2016. RAD was devised to address the physical deterioration of public housing and secure a more stable funding stream. It requires public housing authorities to shift properties out of the public housing program into a different subsidy program (project-based Section 8) which enables them to obtain mortgages on more favorable terms and to secure tax-credit investment. The program is currently limited to 185,000 housing units. As of April 6th, the program was fully subscribed, and had generated more than $2 billion in new investment. Extrapolating from the early results, RAD has the potential to yield more than $15 billion for fund the redevelopment and renovation of public housing.     

Leaving Homelessness Behind: Housing Decisions Among Families Exiting Shelter

Because homelessness assistance programs are designed to help families, it is important for policymakers and practitioners to understand how families experiencing homelessness make housing decisions, particularly when they decide not to use available services. This study explores those decisions using in-depth qualitative interviews with 80 families recruited in shelters across four sites approximately six months after they were assigned to one of four conditions (permanent housing subsidies, project-based transitional housing, community-based rapid re-housing, or usual care). Familiar neighborhoods near children's schools, transportation, family and friends, and stability were important to families across conditions. Program restrictions on eligibility constrained family choices. Subsidized housing was the most desired intervention, and families leased up at higher rates than in other studies of poor families. Respondents were least comfortable in and most likely to leave transitional housing. Uncertainty associated with community-based rapid re-housing generated considerable anxiety. Across interventions, many families had to make unhappy compromises, often leading to further moves. Policy recommendations are offered.     

Measuring What Matters: A Call for a Meaningful Metric of Affordable Rental Housing Production Cost-Efficiency

The metric commonly used in debates and research concerning the cost-efficiency of multifamily rental housing production, total development cost per unit, sacrifices too much analytical power in return for its ease of computation. This article proposes a replacement metric, the subsidy per housing affordability equivalent (SHARE) ratio. This measure is applied to a set of 399 nonprofit-sponsored rental housing developments completed in California over the past decade. Evidence suggests that the use of SHARE would evaluate deeply subsidized family projects and mixed-use projects with commercial space more favorably than total development cost per unit would. The reverse is true for projects restricted to seniors and for those financed with Low-Income Housing Tax Credits.     

A different lens: administrative perspectives on portability in Illinois' Housing Choice Voucher Program

Over the last decade, the Housing Choice Voucher Program has grown to become the USA's primary strategy for providing safe, decent, and affordable housing. Annually serving more than 2 million low-income households, the program is designed to help low-income households afford private market rental housing. The program also allows for the “portability” of vouchers nationally between housing authority jurisdictions. Both features aim to mitigate the effects of concentrated poverty. Research on the Moving to Opportunity Program and the Gautreaux consent decree have produced data confirming that residential mobility can at times lead to positive opportunities for assisted households. This past research has been conducted on specific programs occurring outside of the general Housing Choice Voucher Program framework and has focused on household-level outcomes, paying little attention to the ways in which program administration may affect outcomes for voucher households. This article aims to understand voucher portability from the perspective of housing authority executive directors and program administrators, in order to better understand how program administration impacts the types of household outcomes observed in prior research. The results reveal that housing authority administrative practices and inter-housing authority relationships play a significant role in shaping the types of outcomes realized by porting voucher households. These findings suggest several changes to program administrative design and policy that may improve support for voucher households as they make portability moves.     

The Use of Rental Housing Assistance by Immigrants in the United States and New York City

Abstract

The large influx of immigrants to the United States and New York City from poorer countries has sparked considerable debate as to whether immigrants are becoming a “public charge” to American society. Most arguments have centered around immigrants’ use of cash assistance programs. This article compares immigrants’ receipt of rental housing assistance with that of native‐born Americans.

Bivariate analyses reveal that immigrants, as a group, are no more likely than native‐born households to use any form of rental housing assistance. Indeed, in most instances immigrants are less likely than native‐born households to receive assistance, with two exceptions: immigrants who have been in the United States since 1970 and immigrants from the former Soviet Union in New York City. Multivariate analyses reveal similar results, except that immigrants who have been in the United States since 1970 are no more likely than other immigrants to receive housing assistance when we control for other factors.