The convergence of nonequity housing models in Canada: Changes to housing policy since 1990

Abstract

This study examines the impact of housing policy convergence on the nonequity housing system in Ontario, Canada. Ontario has four distinct nonequity housing models— public, nonprofit cooperative, municipal nonprofit, and private nonprofit. This article argues that since 1990, housing policy in Canada, and particularly in Ontario, has become increasingly influenced by the neoconservative agenda of downsizing and decentralization of government functions found in the United States.

The findings reveal that changes to housing policy have caused the convergence of nonequity housing models in the areas of management and administration. Drawing on the present findings and on an experimental project in tenant management, this article argues that the trend toward convergence will continue and will likely result in one nonequity housing model in Canada. This pattern is interpreted in light of the neoconservative agenda of both countries that emphasizes private sector solutions to housing low‐income families.     

Assessing Economic Change in HOPE VI Neighborhoods

Abstract

Neighborhoods surrounding large public housing developments have historically been economically distressed. The revitalization of many developments through the federal HOPE VI program, in conjunction with increased inner‐city lending and a strong economy for much of the 1990s, should theoretically lead to improvements in these neighborhoods. This study analyzes changes in selected HOPE VI neighborhoods since 1990 and compares them with changes in other high‐poverty communities, as well as with overall trends in their respective cities.

At the beginning of the decade, conditions in HOPE VI communities were almost universally worse than in other high‐poverty areas. By the end of the decade, the relationship was reversed. The changes resulted from a number of interrelated factors, including the redevelopments themselves, other private market activity, specific commitments of resources by city governments, and increased attention to the communities by lenders. These neighborhoods still qualify as economically distressed, but economic development now seems a realistic possibility.     

Social capital and crime in New York City's low‐income housing

Abstract

This article presents evidence that components of social capital can play a prospective role in preventing crime in low‐income housing. It develops a conceptual approach to crime prevention involving social capital, alternative forms of ownership, and environmental design considerations. The study compares five programs that house New York City's poorest, mostly minority residents. The effectiveness of social capital in preventing crime is assessed using data from surveys of 487 buildings in Brooklyn, NY, and crime data from the New York City Police Department.

Results of the analysis indicate that three components of social capital—basic participation in tenant associations, tenant prosocial norms, and a building's formal organization—were all related to reducing various types of crime in the buildings under study 6 to 12 months after social capital was measured. The effectiveness of social capital was related to alternative ownership structures, building characteristics, and housing policy.     

Public housing and the American dream: Residents’ views on buying into “the projects”

Abstract

This article examines residents’ attitudes toward homeownership in five large inner‐city public housing projects composed of multifamily apartment buildings. Based on 267 interviews with public housing residents in Boston, it contrasts their broad support for homeownership as a concept with their wholly mixed reaction to the idea of owning a public housing apartment. Interest in homeownership in public housing is shown to be independent of residents’ current employment status and closely tied to residents’ social investment in specific housing developments and to their perceptions about the quality of that development's management, maintenance, and security.

The findings cast renewed doubt on policies that would make public housing sales a centerpiece of national policy, but they provide qualified support for more modest efforts to increase homeownership in public housing developments and in low‐income neighborhoods around them.     

The functioning and regulation of escrow accounts

Abstract

About 40 million Americans have mortgages serviced by escrow accounts. Yet escrow accounts are rarely covered by an explicit agreement between borrower and lender and are often poorly understood. As a result, escrow accounts have become the subject of growing controversy. Federal regulation of escrow accounts has become increasingly detailed and intrusive during the past two decades, and the subject is under almost continuous regulatory review. In the 1990s, the attorneys general of at least 10 states have sued large escrow account servicers over administration of accounts.

The purposes of this article are to explain briefly how escrow accounts work, benefit relevant parties, and are regulated by federal agencies, and to evaluate alternative regulatory programs. Most of the legitimate social goals of federal regulation could be achieved by requiring an explicit escrow agreement at the time of closing on a mortgage. A second‐best requirement would be that interest be paid on escrow balances.     

Introduction to session 3: Estimating the costs: Perspectives on preservation of the nation's lower‐income housing stock

Abstract

This article uses survey data from the Moving to Opportunity demonstration program in Chicago to explore changes for households moving from public housing. The focus is on two key areas: housing and neighborhood conditions, and labor force participation and employment of householders. The experimental design of the program allows the differences between comparison households, which moved with a regular Section 8 voucher, and experimental households, which moved to low‐poverty neighborhoods with housing counseling assistance, to be examined.

The findings, based on interviews an average of 18 months after families moved, reveal dramatic improvements in neighborhood and housing conditions for all participating families; experimental families experienced even greater gains in terms of housing and especially neighborhood conditions. Labor force participation and employment increased for householders in both groups, likely fueled by the robust economy throughout much of the country and supporting similar findings for program participants in New York and Boston.     

Social capital and the revitalization of New York City's distressed inner‐city housing

Abstract

This article presents evidence that social capital can be an effective component of locally sponsored low‐income housing programs. It provides a model for measuring social capital at the building level, where it may be most effective in improving housing quality and security. The study compares five programs in New York City that house the city's poorest, mostly minority residents. The surveys from 487 buildings in Brooklyn, NY, were analyzed to compare the success of programs in maintaining and revitalizing landlord‐abandoned buildings taken by the city in lieu of taxes.

Results of the analysis demonstrate that the positive effects of tenant ownership were largely mediated by the higher levels of social capital found in these buildings. These levels have implications for the survival and economic advancement of poor households and civic participation in poor communities. The study suggests the value of alternative homeownership programs.     

Networks and nonprofits: Opportunities and challenges in an era of federal devolution

Abstract

Community development corporations and other nonprofit organizations are increasingly responsible for producing and managing low‐income housing in urban America. This article examines the network of governmental, philanthropic, educational, and other institutions that channel financial, technical, and political support to nonprofit housing sponsors. We analyze the relationships among these institutions and propose an explanation for their success. We then consider challenges the network must confront if the reinvention of federal housing policy is to succeed.

Block grants and rental vouchers, the dominant emphases of federal policy, present opportunities and constraints for nonprofit housing groups and their institutional networks. While states and municipalities are likely to continue to use block grants for nonprofit housing, the viability of this housing will be severely tested as project‐based operating subsidies are replaced by tenant‐based vouchers. We recommend ways that the federal, state, and local governments should help the institutional support network respond to this challenge.     

The cost‐effectiveness of the low‐income housing tax credit relative to vouchers: Evidence from six metropolitan areas

Abstract

How expensive is the Low‐Income Housing Tax Credit (LIHTC) program relative to vouchers? Are there any market conditions under which the supply‐based LIHTC could be more cost‐effective than demand‐based vouchers? This article examines these questions in six metropolitan areas—Boston, New York, San Jose (CA), Atlanta, Cleveland, and Miami. Controlling for family income and unit size, I compare the development subsidies of new‐construction LIHTC projects with the alternative 20‐year voucher cost in each area.

In general, the LIHTC is found to be more expensive than vouchers. The premium, however, varies significantly by voucher payment standard and local housing market. Assuming a payment standard of 100 percent of fair market rent, the LIHTC is only 2 percent more expensive than vouchers in San Jose, but more than twice as expensive as vouchers in Atlanta. Many factors account for these regional variations. This study emphasizes two: local market conditions and program administration.     

Racial/ethnic differences in housing outcomes for first‐time,low‐income home buyers: Findings from a National homeownership education program

Abstract

Federal housing policies aimed at making homeownership more accessible through education and affordable lending have been successful in raising the homeownership rate among minorities. By marketing homeownership to underserved populations and helping them overcome financial and informational obstacles, such programs might be expected to promote equality in housing outcomes, including housing quality, neighborhood composition, and neighborhood conditions, for minority homeowners.

This article examines the experience of participants in a national home‐ownership education program. While the transition to homeownership has been associated with modest progress, it does not overcome persistent disparities in housing quality. Homeownership appears to lead to poorer neighborhood conditions for all lower‐income buyers—not just minorities—and may be exacerbating social and spatial isolation rather than helping to overcome it. Differences in neighborhood outcomes, however, may be due to locational preference rather than discrimination in housing and mortgage markets.