Dilemmas of Development: Challenges to Achieving Affordability Among Housing Suppliers and Local Governments

Session Submission Type: Panel

Abstract

Housing abundance has become a major bipartisan policy goal in the wake of the worsening housing affordability crisis in the United States. Policymakers across state and local jurisdictions have begun a major push to upzone urban communities and allow for more mixed development types while reducing barriers to construction. At the same time, many communities now actively attempt to encourage housing development through various state and local subsidies. This movement is motivated by the belief that rapid development of new housing can ease housing costs and displacement through increased market competition. The four papers in this panel present some of the challenges that governments, developers, and investors face in implementing supply growth. Each paper conducts analysis with an eye for presenting policymakers and practitioners with key factors to consider when crafting state and local policy meant to achieve affordability. 

These papers reveal that affordability and related population dynamics are shaped by the behaviors of private market actors as they engage with the political economies of state and local regions. Two of the papers take on the outcomes of investors and landlords who work in growing housing markets in North Carolina and Austin, Texas. From these papers, we learn that investors see distressed homes as a financial opportunity and this distress informs decisions around future housing investments (Lowell) and that large landlords’ are responsive to surges in nearby market-rate development (Messamore). The other two papers take on housing markets in which supply is more constrained. One paper finds that nonprofits struggle to comply with the complexity of California’s LIHTC policy, which undermines their missions of providing affordable housing to the lowest income households (Smock). The other paper finds that upzoning, which policymakers hope will facilitate affordability, may be a driver of displacement in New York City (Sullivan). Taken together, these papers raise significant challenges facing housing market rate development and attempts to increase deep housing affordability.

Policy Area

• Housing, Community Development, and Urban Policy

Chair

• Brian Y. An, Georgia Institute of Technology

Discussants

• Vincent J. Reina, University of Pennsylvania

• Laura Tach, Cornell University

Organizer

• Warren Robert Lowell, Vanderbilt University

Individual Presentations

• The Hidden Cost of Complexity: How Affordable Housing Finance Undermines Mission-Driven Development - Presenting Author: Katherine Smock, University of California - Los Angeles

• Understanding upzoning’s role in neighborhood change: Evidence from New York City - Presenting Author: Laura R Sullivan, University of Toronto

• Dealing in Distress: How Investors Find Value in Ailing Homes and Influence Housing Affordability - Presenting Author: Warren Robert Lowell, Vanderbilt University

• Making the Rent Up: How Landlords Price Rent During a Housing Development Boom - Presenting Author: Andrew Messamore, University of Washington