Moving To Opportunity

Mount Laurel

The Center on Budget and Policy Priorities has posted Realizing the Housing Voucher Program’s Potential to Enable Families to Move to Better Neighborhoods. It opens,

Housing Choice Vouchers help families afford decent, stable housing, avoid homelessness, and make ends meet. They also enable children to grow up in better neighborhoods and thereby enhance their chances of long-term health and success. When African American and Hispanic families use housing vouchers, for example, their children are nearly twice as likely as other poor minority children to grow up in low-poverty neighborhoods and somewhat less likely to grow up in extremely poor areas. Still, 280,000 children in families using vouchers lived in extremely poor neighborhoods in 2014. Vouchers could do much more to help these and other children grow up in safer, low-poverty neighborhoods with good schools.

Public housing agencies have flexibility under current Housing Choice Voucher (HCV) program rules to implement strategies to improve location outcomes, and state and local governments could facilitate these efforts. But without changes in federal policy to encourage state and local agencies to take such steps and to modify counter-productive policies — and reliable funding to maintain the number of families receiving HCV assistance and to administer the program effectively — there is little reason to expect better results.

Federal, state, and local agencies can make four sets of interrelated policy changes to help families in the HCV program live in better locations:

  • Create strong incentives for state and local housing agencies to achieve better location outcomes;
  • Modify policies that discourage families from living in lower-poverty communities;
  • Minimize jurisdictional barriers to families’ ability to live in high-opportunity communities; and
  • Assist families in using vouchers to rent in high-opportunity areas. (1)

This paper poses a number of concrete policy proposals for HUD to increase choices for voucher recipients. They include giving weight to location outcomes for recipients in measuring local housing agency performance; aligning these goals with the new fair housing rules; and providing incentive payments to local agencies that help voucher recipients move to higher-opportunity areas. (8) There are more concrete proposals in the paper that I leave to the reader to review.

What I like about these proposals is that many of them can be implemented administratively by HUD, just like the fair housing rules were. I hope HUD is giving this paper its full attention — there is a lot of good stuff in it that can help people move to opportunities that they cannot currently access.

Thursday’s Advocacy & Think Tank Round-Up

  • The Center on Budget and Policy Priorities has released a report Realizing the Housing Voucher Program’s Potential to Enable Families to Move to Better Neighborhoods in which it recommends key changes which would lead to long term upward mobility for families using housing vouchers – chief among their goals is encouraging recipients relocation to lower poverty neighborhoods.
  • Corelogic’s September 2015 National Foreclosure Report in which it finds the number of foreclosures down 1.3% since August, and foreclosure inventory is down 23.4% since September 2014.
  • The Mercatus Center at George Mason University’s How Land Use Regulation Undermines Affordable Housing concludes that most regulation lead to higher costs (over free market prices) which disproportionately accrues to lower income citizens.
  • Seeking Alpha blogger proposes that rather than a QE4 the Fed should arrange Student Loan Property Bond to restore growth.  This is how it would work: “The Fed would convert that loan into a Property Bond that pays off the $29,000 loan and advances an additional $29,000 to the student for the home deposit in return for taking a 10% stake in the acquired property. There would be no dividend attached to the Property Bond – the Fed’s return would come from the home price appreciation… The main owner of the property could later choose when the Fed realizes [sic] its return – it could be at the sale of the first home or rolled over onto subsequent purchases until, ultimately, the death of the main owner.”

California Dreamin’ of Affordable Housing

Architecturist

Just A Dream for Many

Yesterday, I blogged about the affordable housing crisis in New York City. Today, I look at a report from the Center on Budget and Policy Priorities, How Housing Vouchers Can Help Address California’s Rental Crisis. It opens,

California’s severe shortage of affordable housing has hit low-income renters particularly hard. Nearly 1.6 million low-income California renter households paid more than half of their income for housing in 2013, and this number has risen 28 percent since 2007. While the shortage is most severe on California’s coast, many families throughout California struggle to pay the rent. A multifaceted approach with roles for local, state, and federal governments is needed to address the severe affordable housing shortage, but the federal Housing Choice Voucher program can play an outsized role.

California’s high housing costs stretch struggling families’ budgets, deepening poverty and hardship and exacerbating a host of other problems. For example, 23 percent of Californians are poor, according to Census measures that take housing costs into account, well above the poverty rate of 16 percent under the official poverty measure. California has 14 percent of the nation’s renter households but nearly 30 percent of the overcrowded renters. And California has one-fifth of the nation’s homeless people, more than any other state. A large body of research shows that poverty, overcrowding, housing instability, and homelessness can impair children’s health and development and undermine their chances of success in school and later in the workforce.

Housing vouchers help some 300,000 low-income California families afford the rent, more than all other state and federal rental assistance programs combined. Vouchers reduce poverty, homelessness, and housing instability. They can also help low-income families — particularly African American and Hispanic families — raise their children in safer, lower-poverty communities and avoid neighborhoods of concentrated poverty. Moreover, so-called “project-based” vouchers can help finance the construction of affordable rental housing in areas with severe shortages.

Yet the number of vouchers in use has fallen in recent years, even as California’s housing affordability problems have worsened. Due to across-the-board federal budget cuts enacted in 2013 (called sequestration), 14,620 fewer California families used vouchers in December 2014 than in December 2012. By restoring funding for these vouchers, Congress can enable thousands more California families to afford safe, stable housing. (1, reference omitted)

Really, the analysis here is not California-specific. The authors are arguing that low-income families benefit greatly from rental subsidies and that Congress should restore funding for housing vouchers because they provide targeted, effective assistance to their users. While California has a high concentration of voucher users, all low-income renter households would benefit from an increase in the number of housing vouchers. No argument there.

I am disappointed that the report does not address an issue that I highlighted yesterday — attractive places like NYC and California continue to draw a range of people from global elites to low-income strivers. Policymakers cannot think of the affordable housing problems in such places as one that can be “fixed.” Rather, it must be seen as, to a large extent, a symptom of success.

So long as more and more people want to live in such places, housing costs will pose a challenge. Housing costs can be mitigated to some extent in hot destinations, but they are hard to solve. And if they are to be solved, those destinations must be willing to increase density to build enough units to house all the people who want to live there.

Tuesday’s Regulatory & Legislative Round-Up

  • A bill to reform Housing Assistance including programs like section 8 and project based assistance was introduced in the House Financial Services Housing Subcommittee by Republican Blaine Luetkemeyer (MO). The bill (HR 3700) seeks to streamline costs to increase efficiency and to reduce energy and water waste.
  • The Chairman of the House Financial Services Committee, Texas Republican Jeb Hensarling, will be hosting a Hearing entitled The Future of Housing in America: 50 years of HUD and its Impact on Federal Housing Policy. The hearing is scheduled for Oct. 22 at 10 am and Rep. Hensarling has released a statement calling for public input. Hensarling characterizes HUD as having failed to live up to its mission, despite 1.6 trillion dollars in spending, he then calls for innovation in solving the generational cycle of poverty which, in his view, is the real issue.

Thursday’s Advocacy & Think Tank Round-Up

  • Capital New York reports another study which finds that non-whites are at a disadvantage when it comes to securing a home loan, this is more pronounced in the conventional loan market (less so for FHA loans). Includes an interactive chart which breaks down the stats by borough.
  • Harvard’s Joint Center for Housing Studies’ Annual State of the Nation’s Housing 2015 reveals historic lows in homeownership rates, and a corresponding “rental boom,” a shortage in supply for single family dwellings, and an increasingly severe rental affordability problem.
  • National Association of Realtors’ release of Existing Home Sales statistics for May reveal a strong rebound over April, in fact sales are strongest they have been in 6 years, with first time homebuyers making up the biggest portion of buyers.
  • NYU Furman Center’s new working paper – Utility Allowances in Federally Subsidized Multifamily Housing – advocates four policy changes which would help HUD increase energy efficiency in the properties it subsidizes.  These include, 1. Incentivizing owners to switch to individually metered units; 2. Incentivizing owners to make energy saving upgrades; 3. Provision of utility allowances that are affordable but make recipients bear the cost of consumption; 4. Provide information about relative utility costs to increase tenant purchasing power.

Tuesday’s Regulatory & Legislative Round-Up

  • The Consumer Financial Protection Bureau issued a consumer advisory in the first regulatory action prompted by the results of its reverse mortgage report entitled A Closer Look at Reverse Mortgages.  Advertisements often lead retirees to believe that reverse loan offers are part of a government program, do not involve interest and fees and fail to mention or prominently display important details regarding these terms.
  • The U.S. Department of Housing and Urban Development (HUD) is seeking comment regarding an expansion of the housing options for Housing Choice Voucher Families.  In many regions the rental subsidy is not sufficient to allow renters to live in lower poverty neighborhoods.
  • HUD also launched a new website for training housing counseling agencies, with an eye toward improving customer service and counseling skills.

 

Monday’s Adjudication Roundup