Study Cites Positive Impact of LIHTC Development in Poorer Neighborhoods
A recent study by Rebecca Diamond and Timothy McQuade of Stanford University Graduate School of Business for the National Bureau of Economic looked at the neighborhood impact of multifamily housing funded by low-income housing tax credits. They found that crime rates fall and property values rise when subsidized housing is built in a poor neighborhood.
The study analyzed transaction and demographic data from 129 counties and found the following facts:
- Neighborhoods with a median income below $26,000 see a 6.5 percent increase in property values within 0.1 miles of the LIHTC development site.
- By contrast, in mostly white neighborhoods with incomes above $54,000, there are house price declines of approximately 2.5 percent within 0.1 miles of the LIHTC development site.
- In low-income neighborhoods, the introduction of affordable housing reduces crime and segregation.
- In high-income neighborhoods, the introduction of affordable housing does not lead to an increase in crime.