Housing
How can we encourage people to invest in and maintain a high quality housing stock while maintaining its affordability for people at many income levels (including both renters and owners)?
Promoting private investment in housing
OVERVIEW
- This approach emphasizes the idea of neighborhoods as places that compete with one another for investment, especially the investment choices of homeowners. The ability of neighborhoods to attract “good” landlords (who do more than simply milk the property for cash flows while letting it run down) is also critical.
- Building confidence in the neighborhood among current property owners and potential future homebuyers is the central task of this approach.
- “Neighborhoods of choice” theory looks particularly at these outcomes for neighborhoods:
- The image of the neighborhood (i.e., the story homeowners, homebuyers and outsiders tell about where the neighborhood is heading).
- Neighborhood physical conditions (e.g., standards of maintenance).
- Neighborhood housing market functioning (e.g., property values should appreciate at least somewhat to provide a return to investment).
- Neighborhood self management (e.g., neighborhood residents should work together to manage neighborhood issues)
RESOURCES AND EXAMPLES
- “Leveraging Home-Ownership Promotion as a Tool for Neighborhood Revitalization,” an article by David Boehlke, discusses the many roles homeowners can play in boosting a neighborhood, from investing in their properties to becoming engaged as neighborhood leaders.
- People need to be confident in the future of a neighborhood’s housing market if they are going to invest in it. “Managing Neighborhood Change,” an article by Allan Mallach at the National Housing Institute, examines “how to build both a stronger housing market and a healthier neighborhood while ensuring that the community’s lower-income residents benefit from the neighborhood’s revitalization.”
- “Pride Blocks” is a strategy that utilizes neighborly events, competitions and prizes, and financing to encourage homeowners to invest in their properties.
- Anchorage Neighborhood Housing Services’ Weatherization, Rehab and Asset Preservation Partnership (WRAP) provides counseling and access to rehabilitation services and loans and grants to Anchorage residents interested in energy-efficiency improvements.
- Ithaca Neighborhood Housing Services Mini-Repair Program offers free labor for minor home repairs. The organization targeted elderly, low-income homeowners, disabled people; and female heads of household of limited means.
- Southside Neighborhood Housing Services Home Owners Prevention Service (HOPS) provides loans and grants to homeowners interested in home repairs who would otherwise be unable to qualify for traditional financing.
Preserving housing affordability
OVERVIEW
- This approach emphasizes the need for the current residents of a neighborhood to be able to stay and benefit from its revitalization, which tends to put upward pressure on home prices and rents.
- Various techniques can be used to maintain the affordability of individual properties, including deed restrictions, limited-equity cooperatives, and community land trusts for homeownership properties. Mutual housing associations and other forms of nonprofit ownership do the same for rental properties.
- Shared appreciation mortgages can also be used to recapture subsidy (and potentially additional funds) from homeowners who are assisted to purchase a property and subsequently sell it at a gain, then reusing the funds to help a new homebuyer.
RESOURCES AND EXAMPLES
- Community Land Trusts are a way of maintaining housing affordability through the legal mechanism of a ground lease on affordable homes. The National Community Land Trust network provides information about this tool here.
- Policy Link has a discussion on tools for achieving long-term housing affordability here.
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