Fair housing and the data paradox

by Patrick Reed, National Housing Conference

In a push for crowd-sourced innovation and better transparency, federal agencies are opening up their data

vaults to the public, substantially increasing the accessibility of this information. State agencies and local governments are increasingly following suit. In general, most would agree that improved data accessibility is a good thing; however, increased availability is not without its challenges, particularly for low-income households and their advocates. Consider the propositions of the following paradox:

A. Open access to data improves opportunity for low-income households.
Example: Using publically available data, PHAs can create opportunity maps to locate census tracts with strong social capital and strong transit access. Housing Choice Voucher counselors can use these maps to help inform their clients’ decisions.

B. Open access to data harms opportunity for low-income households.
Example: Using an online tool, a high-income family realizes that a home they are interested in purchasing falls within the boundaries of a census tract with a large number of foreclosures and vacancies. They decide not to pursue the property any further. Current residents in the neighborhood miss out on the addition of a stable family that could have potentially drawn in more resources and higher-income neighbors.

If we’re thinking in terms of net gains and losses, we can’t say that both of these propositions are simultaneously true.

Lisa Prevost's article in last Friday’s New York Times does an excellent job of contextualizing the data access problem. Third-party companies help people access detailed information about neighborhood demographics, income levels, crime, school quality etc. These companies often source their information from publically available database sites like the Census Bureau’s American Fact Finder. As many of these companies aren’t licensed brokers, they aren’t subject to the Fair Housing Act’s laws about steering. Because their products affect the market and competition, licensed brokers are also beginning to test their own boundaries. This raises a number of policy, and ethical, questions, such as:

• Should non-brokerage companies who capitalize on public data be subject to the same Fair Housing rules?
• For brokers who don’t want to lose ground to unregulated third-party companies, if a broker directs a client to sites like American Fact Finder (or even links these sites to her firm’s web page), is that a violation of the Fair Housing Act?
• Should agencies like HUD and the Census Bureau limit data that are sensitive and potentially damaging to the pursuit of integration?
• Do low-income populations have the same access to information as high-income populations? If so, do they have the resources that will help them use it to their advantage?

I don’t know the answer to these questions, but I think housing advocates and civil rights groups need to substantially raise the profile of this issue before our current “no-questions asked access” becomes the norm—if it isn’t already. Additionally, we need researchers to investigate whether or not the availability of data has affected patterns of racial and economic segregation. Who knows, maybe research findings will help alleviate some concerns.

If you’re still not convinced that this is an issue, perhaps a quick anecdote will help: last week, a peer and I completed a graduate school project that analyzed dollar per square foot costs, walkability and school quality indicators in an increasingly stratifying urban county. Using publically accessible data, GIS and some statistical sorcery, we were able to pinpoint particular properties—not block groups or tracts—in high-quality school catchments where residents weren’t paying the same premiums as their neighbors for a high-quality education. Our purpose was to promote child well-being by creating a “burden-bargain index” that would help CDCs locate target properties for potential acquisition or restoration.

A couple of days after our presentation, I was approached by an individual who works in a mid-management position, is salaried, and is assumedly quite stable: “I heard about your project—sounds neat. My husband and I are in the hunt for a home right now in the county. You’ll have to show me your maps at some point.” 

Given the project’s intent, how should one respond to such requests? How will our policymakers respond?

What’s next in housing and transportation cost research?

by Chris Marshall, National Housing Conference

NHC’s Center for Housing Policy will begin researching the combined housing and transportation (H+T) costs of low-income households (those at or below 50 percent of area median income (AMI)). To do so, Center staff is capitalizing on data from HUD’s Location Affordability Index (LAI).

The LAI predicts housing and transportation costs for different geographic levels in 942 Core Based Statistical Areas (covering 94 percent of the U.S. population). The cost estimates are for 12 different household types, ranging in estimated income from a two-worker family to a single, very low-income person. 

This is not the first time the Center has researched H+T costs. In 2006, we partnered with the Center for Neighborhood Technology (CNT) and the Institute of Transportation Studies at UC-Berkeley to produce A Heavy Load: The Combined Housing and Transportation Burdens of Working Families. The report documented how moderate-income households were making trade-offs between housing and transportation costs. The Center and CNT partnered again in 2012 to produce Losing Ground: The Struggle of Moderate-Income Households to Afford the Rising Costs of Housing and Transportation. This report examined the H+T burdens of moderate-income households in the 25 largest metro areas in the U.S.

Center staff is excited to use data from the relatively new LAI, as it builds on previous housing and transportation cost tools (see CNT’s H+T Affordability Index). Using the data, however, requires that one acknowledge some limitations. Chief among these is that housing data is from the 2006-2010 American Community Survey. A third-party review says that “house prices within and between cities can change drastically over a few years, and using data that is, on average, four years old creates a significant risk that estimates are not accurate.” Related limitations include the use of older mortgage data (thereby not reflecting the true, current cost of newly buying a home in a neighborhood) and the use of imprecise block group data. As the review states, “For every block group… the average margin of error for block group level (selected monthly owner costs) is 37percent of the level.”

These limitations in mind, the LAI remains a helpful tool to at least generally understand H+T costs for low-income (and other) households. Local entities are using the tool to analyze what is happening in their parts of the country. For example, the Chicago Metropolitan Agency for Planning uses the LAI to estimate “that a typical low-income household would need to spend 46… to 145 percent of its income on [H+T] to live in much of the region.” The Metropolitan Washington Council of Governments says “the [LAI] will be another key device in COG’s toolkit to help meet the Regional Forward Target in keeping housing and transportation costs below 45percent of median household income….” And the cities of Minneapolis and Saint Paul link to the LAI from their “Live MSP” homepage to help current and prospective residents “measure the true affordability of a city neighborhood….”

Going forward, we will consider diving into certain research questions, such as:

·         What are the H, T, and combined H+T costs for low-income households nationwide and in the largest metro areas?

·         If the H+T share of income is relatively higher for low-income households than others, what are the economic and social implications?

·         How might H+T costs for low-income households correlate with access to opportunity areas?

·         What are the implications of the methodology and data limitations on using LAI data for analyzing H+T costs?

How have you used the LAI to answer your particular research questions?

Who lives in subsidized housing?

by Lisa Sturtevant, Ph.D., National Housing Conference

As I wrote in this space last week, HUD’s Office of Policy Development and Research (PD&R) has released detailed data about households receiving Federal housing assistance. According to the new data, in 2013 there were over 5.2 million HUD-subsidized housing units in the United States serving over 10 million people. Who is receiving Federal housing assistance?

·         The majority of households receiving assistance are either families with children, seniors or households with a disabled person.

o   39 percent are families with children

o   33 percent are seniors age 62 and older

o   34 percent are non-senior disabled

(Note: there is overlap between families with children and non-senior disabled populations.)

·         Three-quarters of households receiving assistance are extremely low income, with incomes at or below 30 percent of area median income (AMI). (As an example, for a family of three, 30 percent of AMI is $29,050 in the District of Columbia and $15,300 in Morgantown, West Virginia. Find the HUD income limits for your area.)

·         64 percent of households receiving assistance are non-white.

o   44 percent are African-American

o   17 percent are Hispanic

o   4 percent are Asian or Pacific Islander

·         The characteristics of subsidized households haven’t changed much since 2009. In 2013, there was a slightly smaller share of families with children and extremely low-income households served, while the shares of subsidized households that were seniors or disabled increased slightly.

Federal housing assistance makes a critical difference in the lives of these individuals and families. And while HUD’s programs served over 4.5 million households in 2013, only about one in four eligible households receives assistance and many needy families remain on long waiting lists.

Sure, housing is a business. But it's also a movement.

by Chris Estes, National Housing Conference

One of the benefits of living and working in Washington, DC is that this city is experiencing the kind of growth and rapid neighborhood change that regularly puts issues of displacement, development and affordability in the local news.

This past weekend I was struck by several local news stories that highlighted the federal and local response to housing issues that are common here and around the country. Some have real implications for our messaging and communications, some for local advocacy participation and some have federal leverage points. For today I will focus on one story from the Washington City Paper that I think combines all three.

While redevelopment, crime reduction and expansion of the local tourism economy can be good things, without planning and preservation, massive displacement can take away the people and character that gave an area like DC’s Chinatown its identity. This is exemplified by a current battle over the Museum Square Apartments, a 302-unit project-based Section 8 building in the Mount Vernon Square neighborhood. Located next to Chinatown, the building houses much of the area’s remaining Chinese population, many of whom are elderly. This affordable development was one of the only residential offerings in the area until the relatively recent entry of high-end condos and apartments. The property’s project-based contract is expiring and the owner wants to redevelop, while advocates are rallying to protect the tenants’ access to affordable housing.

While the details of any one property involve business decisions and intensely local politics, the story holds several lessons for our work. First, quality, long-term affordable multifamily housing must be part of a response strategy to neighborhood (re)development. Affordable homes need to be part of the plan early on. Second, preservation of key affordable residential developments is paramount for every city’s long-term success. Is Chinatown as vibrant a social and economic destination if all the former residents cannot stay?

In the end, this is why affordable housing is a movement, not an industry. As I have said before, it’s true that housing is very much a business, one that demands a high level of expertise from multiple partners. But because the need for affordable housing interventions is so great and we are so short of meeting the demand, we are all called to look beyond the individual business case and advocate together across the continuum of affordable housing for solutions that channel the expertise of the business community into meeting the community’s housing needs.

We must continue to use value-based messaging to help local officials and the public understand why quality affordable homes are central to community success. We must continue to look at factors that make housing such a vital platform for success and go beyond a “units produced” mentality with useful research and best practice examples. Each of us must advocate—not just those of us in “advocacy jobs”—at  the federal level for more resources and locally for regulations that ensure preservation of existing units is more easily facilitated.

This story provides a cautionary tale for the hundreds of communities facing redevelopment decisions or gentrification pressures. It is also one that helps focus us here at NHC on our mission to bring everyone into the affordable housing movement and keep moving housing forward.

HUD releases new data on subsidized households

by Lisa Sturtevant, Ph.D., National Housing Conference
HUD’s Office of Policy Development and Research (PD&R) has released detailed data about households receiving Federal housing assistance. According to the new data, in 2013 there were over 5.2 million HUD-subsidized housing units in the United States serving over 10 million people. Over the next week or two, NHC’s Center for Housing Policy will be analyzing the subsidized household data to provide a better understanding of the characteristics of families and individuals who benefit from HUD programs. A few key findings from the national data:

·         Three-quarters of subsidized households are extremely low income, meaning they have incomes below 30 percent of area median income (AMI).

·         Subsidized households have an average monthly income of $1,074 and spend an average of $304 on rent. 

·         One-third of subsidized households are headed by a person age 62.

·         On average, subsidized households live in census tracts where 25 percent of the households are at or below the poverty level.

·         Forty-four percent of households assisted are African-American; 17 percent are Hispanic.

·         Eight percent of subsidized households moved into their unit in the past year.

·         The New York region has the highest total number of subsidized households at over 508,000. The Herbert, Utah region has one subsidized household.

·         Over 328,000 subsidized households (or about 6.3 percent of all subsidized households) live outside a core-based statistical area (CBSA). (A CBSA is region with an urban center that has at least 10,000 people.)

Stay tuned for more analysis of the subsidized household data from NHC. We will explore questions like:

·         How do the characteristics of subsidized households vary by region?

·         How long do people stay on the waiting list and how long do residents tend to remain in subsidized housing?

·         How does the number of HUD subsidized units in a place compare to the number of units created under the LIHTC program?

·        In what regions are subsidized units most likely to be located in low-poverty neighborhoods?

Time to think ahead to the fall

by Chris Estes, National Housing Conference


July is an interesting time in Washington, when many folks have one eye to Independence Day celebrations in town, and another to escaping the heat and humidity of the city. While recess puts legislative work on hold, we expect several major opportunities on the regulatory side, as Ethan describes below.

There is no lull in NHC’s work, either. With our signature events, the Annual Gala and Policy Symposium, behind us, we immediately shift our focus to our very busy fall that will culminate in Solutions 2014 in Oakland, Calif. Nov. 18-20.

The Solutions 2014 agenda is available on our website now, and we’ll be adding more information as we flesh out our sessions and speakers. Like last year’s conference in Atlanta, Solutions 2014 focuses on state and local housing policy issues and provides a unique opportunity to hear from advocates, developers, local governments, lenders, syndicators and researchers all in the same place.

We’ve worked hard with our Track Advisory Groups to design workshops that provide diverse and topical content and discussion in the following issue areas:

·         Restoring Neighborhoods – strategies and research communities can use for preventing foreclosures, stabilizing neighborhoods and creating a more resilient housing system.

·         Housing Intersections – explores the many ways in which stable, affordable housing helps to support other important social outcomes such as health, education and economic prosperity.

·         Inclusive Communities – getting affordable housing to areas of opportunity as well as planning for growth and gentrification.

·         Housing Communications - promising communications strategies for expanding awareness and building support for affordable housing policies and development.

Workshops will feature best practices, the latest research and a lot of dialog where you can learn more from the presenters as well as other attendees.

We also feature bonus and roundtable tracks, with workshops and facilitated discussions on a range of topics like the importance of design, organizing residents for state advocacy efforts, HUD’s Rental Assistance Demonstration, talking about homelessness and others.

In addition to exciting plenary and keynote speakers, we will also feature four mobile workshops. These workshops tour developments in different parts of the Bay Area, showcasing a variety of affordable housing examples and giving you the chance to talk to the people involved in making those developments happen. Look out for announcements about speakers and mobile workshop topics soon.

Now is the time to register and secure your discounted hotel room! And if you are interested in being a sponsor or exhibitor at Solutions 2014, there are great opportunities available.

All of this is just a portion of our effort to be an organization of value for those working to increase the supply of and access to quality affordable homes. We thank you for your membership and financial support and hope you will let others know about why becoming a member of NHC will help them in their work.

Reading into Treasury’s housing policy announcements

What we're building

by Ethan Handelman, National Housing Conference

Treasury Secretary Jacob Lew’s announcement of new moves in housing policy last week surprised many housing stakeholders, especially those used to HUD’s deliberate telegraphing of moves rather than Treasury’s top-secret-until-announced approach. Upon reflection, each of the policy actions underscores major housing challenges of housing affordability and post-foreclosure neighborhood recovery that Treasury is addressing in a political environment frozen by a partisan divide.

·         Extending Making Home Affordable, which includes HAMP and HARP, shows that Treasury realizes we are in the long tail of the foreclosure wave. There are many homeowners still struggling with underwater or unsustainable mortgages. The HAMP mortgage modification program and the HARP refinancing program have created an industry standard for finding individual solutions that by avoiding foreclosure are better for borrowers, lenders, and neighborhoods.

·         Asking for comment on how to restart the private-label securities (PLS) market for home loans is a reminder that Treasury still wants to crowd in private capital to the mortgage market. We heard that way back in 2012 at the NHC Policy Symposium and once again at this year’s Policy Symposium from Under Secretary Mary John Miller. If Treasury’s planned meetings and the requested comments can shed more light on the persistent resistance of PLS investors, so much the better.

·         Calling for bipartisan housing finance reform shows that Treasury knows our housing finance system is still broken. Too much rides on Fannie Mae, Freddie Mac and the FHA even now, and many potential homeowners can’t obtain loans. As NHC has called for, we need a sustainable reform that provides housing options for homeowners and renters alike, which can only come through bipartisan, outcome-focused housing finance reform.

·         Providing capital for multifamily risk-share transactions through the Federal Financing Bank shows that Treasury knows we have a rental housing affordability crisis. Harvard’s State of the Nation’s Housing just made that point most strongly, and this new pilot action by Treasury could provide additional capital for affordable rental housing. It’s a small but potentially significant step in the right direction, and we’ll know more once the first transaction in New York City closes.

These actions come in a fraught political environment paralyzed by partisan battle. President Obama is explicitly acting in ways that do not require Congress, a course that can move more quickly, but is ultimately limited in reach. While we welcome positive change on housing’s biggest challenges, we also know that only a concerted bipartisan legislative effort can truly get the job done.