Who Wants Affordable Housing in their Backyard? An Equilibrium Analysis of Low Income Property Development

Rebecca Diamond and Timothy McQuade

No 22204, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We nonparametrically estimate spillovers of properties financed by the Low Income Housing Tax Credit (LIHTC) onto neighborhood residents by developing a new difference-in-differences style estimator. LIHTC development revitalizes low-income neighborhoods, increasing house prices 6.5%, lowering crime rates, and attracting racially and income diverse populations. LIHTC development in higher income areas causes house price declines of 2.5% and attracts lower income households. Linking these price effects to a hedonic model of preferences, LIHTC developments in low-income areas cause aggregate welfare benefits of $116 million. Affordable housing development acts like a place-based policy and can revitalize low-income communities.

JEL-codes: H23 R13 R38 (search for similar items in EconPapers)
Date: 2016-04
New Economics Papers: this item is included in nep-pr~ and nep-ure
Note: LS PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (15)

Published as Rebecca Diamond & Tim McQuade, 2019. "Who Wants Affordable Housing in Their Backyard? An Equilibrium Analysis of Low-Income Property Development," Journal of Political Economy, vol 127(3), pages 1063-1117.

Downloads: (external link)
http://www.nber.org/papers/w22204.pdf (application/pdf)

Related works:
Working Paper: Who Wants Affordable Housing in Their Backyard? An Equilibrium Analysis of Low Income Property Development (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:22204

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w22204

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().