Terner Center Blog: No Limits

Category Archives: Assessing Impact of Housing Policies & Programs

A ‘Safe Haven’: Resident Stories Convey the Benefits of Affordable Housing

The Low-Income Housing Tax Credit (LIHTC) has become the most important funding source for affordable housing development in the United States, producing nearly 3 million housing units since its inception in 1986 and housing over 13 million people.

Despite its significance in the housing market, relatively little research has been undertaken to document and understand the experiences of residents living in LIHTC-funded properties. Today, the Terner Center is releasing a new study addressing this research gap. Our analysis sheds light on how living in LIHTC properties impacts low-income residents, particularly with regard to housing stability, economic mobility, and access to education.

We conducted interviews and surveys with over 250 residents living in 18 properties across California, located in neighborhoods with varying levels of poverty. Overall, the results of the survey reveal many advantages to living in a LIHTC-funded property.

Unsurprisingly, affordability was the greatest benefit reported by LIHTC residents. In describing their living situations prior to moving into a LIHTC property, residents reported conditions that were unaffordable, unsafe, and dire. One in five of those surveyed said that they had experienced homelessness before moving into their current unit, with another twenty percent reporting that they had been forced to move involuntarily, either as the result of an eviction or rent increase.

Housing and Financial Situation Prior to Moving into LIHTC Unit

In contrast, living in a LIHTC building provides much needed housing stability, which in turn positively impacts residents lives.  One of the most common terms used to describe their new home was a “safe haven,” a place where residents are protected from sharp rent increases or poor living conditions.  In turn, this housing stability allowed residents to improve their work prospects and invest in their own and their children’s education.

The majority (58 percent) of working-age residents we surveyed were employed. We also found that the educational outcomes in the schools that LIHTC residents in our sample attend are on par with California averages, and that the majority of parents were happy with their children’s school. Another positive finding: nearly 60 percent of college-aged children in the sample were enrolled in college.

Yet many of the residents’ jobs were precarious, and lacked good wages, benefits and opportunities for advancement.  Residents articulated the challenges of earning enough to find any other housing they could afford.

The Job Characteristics of LIHTC Residents

Beyond considering affordability, employment and educational outcomes, the study offers insights into how residents perceive their neighborhoods, capturing a far more nuanced appraisal of communities than is often captured in data. Many residents feel strong ties to the neighborhood, even when poverty rates are high, and see the benefits of investing in the neighborhood as a way to promote community development and ensure affordability in the face of gentrification pressures. This aspect of the study provides important context for recent regulatory focus on the siting of LIHTC and other affordable housing properties: we conclude that while LIHTC policy has a role to play in promoting fair housing goals, it is important not to forget that neighborhoods in California are changing rapidly, and that residents often develop strong social and cultural ties to the places they live.

Finally, the study highlights that siting LIHTC buildings in lower poverty neighborhoods is insufficient on its own to expand opportunity for low-income, working families. In spite of the study’s positive findings, broader housing market and labor conditions are likely to keep most residents in LIHTC properties for the foreseeable future; constrained supply and low wages make it nearly impossible for LIHTC residents to find similar quality housing they can afford on the private market.  Research and policy devoted to expanding housing options for those at 80-120 percent AMI is needed to ensure LIHTC can serve as platform for economic and housing mobility. In addition, the state should continue to identify policies that encourage cities to identify and zone land for multifamily housing, boosting overall supply. Further research is also needed to explore the outcomes for LIHTC tenants across the United States to better understand the role that affordable housing plays in promoting economic mobility.  Nonetheless, this study provides an important snapshot of the experiences of LIHTC tenants in California, and gives us a better understanding of the impact of this important tool in the affordable housing landscape.


ADU Update: Early Lessons and Impacts of California’s State and Local Policy Changes

Posted on by David Garcia

A multi-pronged approach to alleviating the shortage of housing in California and other high-cost regions is urgently needed. As we have discussed in past research, Accessory Dwelling Units (ADUs) - built with a small footprint predominantly in under-utilized single family neighborhoods - can offer much needed naturally-affordable supply to the market. In the fall of 2016, the California State Legislature passed a set of bills intended to clear the way for the proliferation of ADUs  in California. Even before these changes were adopted, many leaders at the local level were pioneering policies to make it easier for residents to build…


New State Policies Aim to Boost Access to Opportunity through Housing

Posted on by Elizabeth Kneebone and Carolina Reid

In California, the Tax Credit Allocation Committee (TCAC) plays an important role in determining where and how Low Income Housing Tax Credits (LIHTC) get allocated for the production of affordable housing. On Wednesday, TCAC adopted a series of policy changes aimed at increasing the development of affordable housing options for families in higher opportunity communities, signaling a commitment to advancing fair housing goals amid the state’s broader agenda to address California’s housing crisis. The regulations seek to respond to a growing body of evidence that communities that provide low-income families access to good schools and safer, lower-poverty, and less segregated…


Lessons for the Future of Public Housing: Assessing the Early Implementation of RAD

Posted on by Carolina Reid

In its 2018 budget, the Trump Administration is proposing to slash public housing funding by $1.8 billion. This cut represents a 29 percent decline from 2017, and will compound a longstanding trend of underinvestment in public housing and worsen an already dire situation. Over time, these shortfalls in federal funding have resulted in a $26 billion backlog in needed repairs, leaving many residents in public housing units across the country with untenable living conditions and a precarious housing future. In addition, every year we lose valuable units of public housing to demolition because of this lack of investment: HUD reports…


From Small Steps to Giant Leaps: What Must Come Next for the California Housing Agenda?

On Friday, September 15th, the California Legislature approved a package of 17 bills aimed at putting a dent in the state’s housing crisis. While the votes came down to the wire, in the end, the need for solutions won the day, and in the coming weeks the Governor is expected to sign each piece of legislation, officially ushering in the most significant housing policy changes in recent memory. You can read our recap of these bills in an earlier blog post here. Drafting, amending, defending and eventually passing these bills was no small feat, and the legislature, the Governor and…


Too Big to Hide: The Importance of Public Data on the Mortgage Market

Posted on by Carolina Reid and Echo Bergquist

Fair lending is the foundation of a thriving economy, both locally and nationally. Access to credit drives home purchases, revitalizes neighborhoods, and allows families to build wealth for future generations. Since the financial crisis, however, tighter credit standards have made it increasingly difficult to obtain a mortgage, especially for low-income and minority borrowers.  A key challenge facing policymakers is how to reform the housing finance system in a way that provides access to credit for a broad range of households, yet at the same time ensures that homeownership is sustainable over the long-term.  Striking this balance is critical, not only…


Jumpstarting the Market for Accessory Dwelling Units

This post originally appeared on the Berkeley Blog on May 23, 2017. It shares insights from our recently released report Jumpstaring the Market for Accessory Dwelling Units: Lessons Learned from Portland, Seattle and Vancouver.   ADU permitting explodes: Permits as a share of all residential permits. How did Portland, Oregon go from permitting two accessory dwelling units (ADUs) per month in 2009 to almost two per day in 2016?  Now, more than one of every ten housing units built in Portland is an ADU. Compared to other housing types, ADUs, or separate small dwellings embedded within single family properties, are…


Balancing the tax code to relieve housing cost burdens

Posted on by Terner Center Team

Of the more than 21 millions renters in the United States who are burdened by the cost of housing today, more than 15 million can not access assistance they are eligible for, because there aren’t enough federal resources to meet their needs. In part, this is a result of skewed tax code that directs significant expenditures to homeowners and other policy priorities, and leaves the housing security and economic mobility of renter families behind.  Amidst emerging conversations about reforming the federal tax code, it is important that we are reminded of this imbalance and seize the opportunity, should there be…


State Policy Solutions to the Short Supply of Housing

When it comes to a lack of affordability in housing, it’s no secret that California is outpacing the nation. Average home prices are about two and half times more expensive than the rest of the country, and rents are about 50 percent higher. A shortage in supply is a key contributing factor, and we need both public policy and private sector solutions that will help expand housing production to better meet demand. This week, the Terner Center is sharing an analysis of one important avenue to meeting this challenge in California: improvements to state land use regulations to promote an…


Why By-Right Affordable Housing in California is the Right Thing to do

Posted on by Carol Galante

The following piece was originally drafted as a letter of support for Governor Jerry Brown’s proposed legislation to streamline local housing approvals. The original letter, with citations, can be found here.   The Permit Streamlining Act. On May 13, 2016, Governor Jerry Brown proposed a change to state law that would streamline affordable housing proposals and spur much needed housing production. Introduced as a part of the administration’s May Revision to the 2016-17 Budget, the by-right bill would effectively change the way local jurisdictions approve housing projects. In doing so, Brown has acknowledged that in order to facilitate more building throughout…