Study Finds Little Evidence of LIHTC Impact on Neighborhood Mobility

WASHINGTON, D.C. – (RealEstateRama) — A new working paper released by the U.S. Census Bureau’s Center for Administrative Records Research and Applications titled The Effect of Low-Income Housing on Neighborhood Mobility: Evidence from Linked Micro-Data assesses the impact of Low Income Housing Tax Credit (LIHTC) developments on neighborhood mobility patterns. The authors find little evidence that LIHTC construction impacts neighborhood mobility patterns, or that it significantly changes the composition of neighborhoods.

The study is the first to examine the causal relationship between subsidized housing and neighborhood choice on a national scale.

A common concern is that building affordable housing in low income communities may cause residents to move to poorer neighborhoods. Empirical research on the subject, however, has been limited. For this study, the authors utilized a national dataset based on 2000 and 2010 censuses that provided individual-level data, HUD data on LIHTC properties to measure the extent of LIHTC development in neighborhoods, and census data to determine neighborhood characteristics.

The authors tracked residents who changed neighborhoods between 2000 and 2010. The analysis revealed that LIHTC construction did not appear to incentivize households to move into lower income neighborhoods more than they would have otherwise. This finding was observed for households at all income levels. The authors also found that LIHTC construction did not appear to significantly alter neighborhoods in terms of racial or ethnic composition, poverty rate, median income, or the homeownership rate.

The Effect of Low-Income Housing on Neighborhood Mobility: Evidence from Linked Micro-Data is available at http://1.usa.gov/298gcds

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