Impact of Low Income Housing on a Community

Two Stanford professors, Rebecca Diamond and Timothy McQuade have demonstrated through analysis of low income housing tax credits awarded over the last ten years that there are measurable impacts on the surrounding properties. They analyzed 16 million transactions from 15 states around 7098 low income housing tax credit sites.Professor Diamond

Here is the salient part of the abstract from their research paper:

"We nonparametrically estimate spillovers of properties financed by the Low Income Housing Tax Credit (LIHTC) onto neighborhood residents by developing a new diference-in-diferences 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."

From this research it is apparent that low income housing needs to be situated in low income neighborhoods as it help revitalize the neighborhood and causes property values to increase, crime to decrease and improves diversity. This is the kind of information that city staff needs to be aware of and to present to council whenever decisions about low income housing come before council.