| Little of the existing literature on housing policy tests the effectiveness of particular strategies. Studies that address program "impact" tend to focus narrowly on the number of units developed or households assisted, and typically fail to link interventions with neighborhood-wide effects; evaluations that do are primarily anecdotal, qualitative accounts. Therefore, the research cannot confirm prior policies' affect on neighborhoods or present policymakers with a strategy for allocating program dollars to meet individuals' and neighborhoods' needs. This project fills this gap by quantifying the interaction between program spending and neighborhood conditions and trends in Philadelphia.; This study found that subsidized investments (the development of affordable housing, particularly owner-occupied housing) appeared to have a significant impact on area values, increasingly so as the scale of investment increased and especially so in weaker markets, affirming initiatives like the "Home in North Philadelphia" policy and HOPE VI-like redevelopment projects. While rarely used by borrowers to purchase housing in weaker markets, low-cost lending was associated with positive neighborhood trends in these areas, particularly when borrowers' incomes exceeded area medians. Alternatively, the concentration of low-cost loan borrowers in "neighborhoods in the middle" was associated with worsening local people- and place-based conditions. These findings suggest that low-cost loans could be a valuable resource for stimulating demand in weaker areas and for making homeownership more affordable in stronger areas. To achieve these goals, though, lending agencies must proactively direct where loans are invested and/or complement home purchase financing with support for unit-based or area-wide improvements. |
