Hitting Bottom? An Updated Analysis of Rents and the Price of Housing in 100 Metropolitan Areas

It has been two years since the housing bubble began to deflate. In this time, home prices in major metropolitan areas have fallen more than 32.3 percent and the woes in the housing sector have spread to the broader economy. Where is the housing market today? Have we hit bottom?This paper, written by researchers from CEPR and the National Low Income Housing Coalition, finds that while most of the nation's metropolitan housing bubbles have deflated and many markets never had one to contend with, there is the possibility of a persistent housing slump in the years ahead. An appropriate response to this situation involves 1) stimulating demand for housing by acting to lower unemployment and raise wages, 2) recognizing a leading role for rental housing in federal foreclosure mitigation and neighborhood stabilization policy, including allowing foreclosed homeowners to remain in their homes as renters (Right to Rent), and 3) adequately funding the National Housing Trust Fund

The Changing Prospects for Building Home Equity An Updated Analysis of Rents and the Price of Housing in 100 Metropolitan Areas

This report updates CEPR's May 2008 report titled "Ownership, Rental Costs and the Prospects of Building Home Equity: An Analysis of 100 Metropolitan Areas," which compared the ownership and rental costs in 100 major U.S. metropolitan areas and projected the potential for a first-time homebuyer in those cities to accumulate home equity. Since the publication of that paper, housing prices have continued their steep descent in much of the country and rents have risen modestly. The study shows that recent price declines indicate many communities are moving back toward the historical track of modest equity increases for homebuyers. The findings point out that is still unwise for policy makers to attempt to directly intervene in housing markets to maintain what are historically unprecedented high home prices

The Cost of Maintaining Ownership in the Current Crisis: Comparisons in 20 Cities

This report compares the ownership and rental costs in 20 major U.S. metropolitan areas. The study finds that in many markets, homeownership costs are in line with rental costs. In these areas, it is practical and desirable to focus on policies that keep homeowners in their homes. The report goes on to show that in bubble-inflated markets, however, homeownership is not only a costly and risky proposition, but continuing price declines mean that homeowners will not accrue any equity. The authors suggest that policy makers should be sure to consider affordable rental options as part of the solution when drafting proposals to help households in these markets

Hitting Bottom? An Updated Analysis of Rents and the Price of Housing in 100 Metropolitan Areas

It has been two years since the housing bubble began to deflate. In this time, home prices in major metropolitan areas have fallen more than 32.3 percent and the woes in the housing sector have spread to the broader economy. Where is the housing market today? Have we hit bottom? This paper, written by researchers from the Center for Economic and Policy Research and the National Low Income Housing Coalition, finds that while most of the nation’s metropolitan housing bubbles have deflated and many markets never had one to contend with, there is the possibility of a persistent housing slump in the years ahead. An appropriate response to this situation involves 1) stimulating demand for housing by acting to lower unemployment and raise wages, 2) recognizing a leading role for rental housing in federal foreclosure mitigation and neighborhood stabilization policy, including allowing foreclosed homeowners to remain in their homes as renters (Right to Rent), and 3) adequately funding the National Housing Trust Fund.housing bubble, right to rent, affordable housing

Ownership, Rental Costs, and the Prospects of Building Home Equity: An Analysis of 100 Metropolitan Areas

This report compares the ownership and rental costs in 100 major U.S. metropolitan areas. Extending the work from a previous CEPR/NLIHC paper, "The Cost of Maintaining Ownership in the Current Crisis: Comparisons in 20 Cities," this study, while demonstrating the wide diversity in housing markets across the nation, finds that in many areas, homeownership costs are in line with rental costs. In these areas, it is practical and desirable to focus on policies that keep homeowners in their homes. The report goes on to show that in bubble-inflated markets, however, homeownership is not only a costly and risky proposition, but continuing price declines mean that homeowners will not accrue any equity. The authors suggest that policy makers should be sure to consider affordable rental options as part of the solution when drafting proposals to help households in these markets.housing bubble, homeownership, housing policy

Patterns of Housing Voucher Use Revisited: Segregation and Section 8 Using Updated Data and More Precise Comparison Groups, 2013

What role does the Housing Choice Voucher program play in the economic and racial segregation of its beneficiaries? Expanding upon Metzger’s (2014) analysis of the 50 most populous U.S. metropolitan areas with contemporaneous data, this paper substantiates the finding that voucher households are more segregated by income and race at the tract level than households that earn less than $15,000 annually. However, the evidence is mixed when the nonvoucher comparison group is more precisely defined using the specific income limits of the U.S. Department of Housing and Urban Development voucher program and a minority household designation. Voucher households are still concentrated in communities with a higher minority population than extremely low-income renters, but there is less difference in terms of economic segregation. Compared to extremely low-income households facing a housing cost burden, voucher holders are less economically segregated, but the indices for racial segregation are mixed. Limiting the comparison to racial and ethnic minority households, we find that minority voucher households are less segregated by economic concentration than minority extremely low-income households but are more segregated by racial dissimilarity. This paper also explores the role of “source of income” nondiscrimination legislation, which is intended to overcome landlord bias against voucher holders. Contrary to previous research, this model produced weaker evidence that voucher holders are more economically or racially integrated in metropolitan areas including source of income protections. Together, these results suggest that vouchers are more successful in helping recipients reach higher-income neighborhoods than those that are more racially and ethnically diverse

The Cost of Maintaining Ownership in the Current Crisis: Comparisons in 20 Cities

This report compares the ownership and rental costs in 20 major U.S. metropolitan areas. The study finds that in many markets, homeownership costs are in line with rental costs. In these areas, it is practical and desirable to focus on policies that keep homeowners in their homes. The report goes on to show that in bubble-inflated markets, however, homeownership is not only a costly and risky proposition, but continuing price declines mean that homeowners will not accrue any equity. The authors suggest that policy makers should be sure to consider affordable rental options as part of the solution when drafting proposals to help households in these markets.housing bubble, homeownership, housing policy

The Crisis in America's Housing: Confronting Myths and Promoting a Balanced Housing Policy

This report debunks three common myths about housing policies. Myth 1: Subsidized housing is unnecessary. Myth 2: Federal government housing subsidies go disproportionately to low-income renters in urban areas. Myth 3: Homeownership is the best housing option for everyone.

Foreclosure to Homelessness 2009: The Forgotten Victims of SubPrime Crisis

This study found that there are many interrelated consequences of the economic downturn that lead to both home foreclosure and to homelessness. There is an increased need for affordable housing, as well as targeted legal assistance, health care, living-wage jobs, income supports, access to education, civil rights protections and the various supports that will continue to be needed as a result of the recession.John Parvensky, Board of Directors President for the National Coalition for the Homeless and Executive Director of the Colorado Coalition for the Homeless states, "This report underscores the fact that we as a nation need to strengthen our efforts to prevent homelessness resulting from this economic crisis, while creating sufficient new affordable rental housing to ensure that no family in America has to experience the tragedy of homelessness."In a national survey of homeless service and advocacy agencies conducted by the these groups, 79 percent of respondents stated that at least some of their clients were homeless as a result of foreclosure, and about half estimated that more than ten percent of their clients were homeless because of foreclosure on a home they had been occupying. During 2008, RealtyTrac reported 3,157,806 foreclosure filings -- default notices, auction sale notices and bank repossessions, an 81 percent jump from 2007 and a 225 percent increase from 2006."We are one step away from foreclosure. More and more families and children are affected by job loss and the economy. 'Getting back on your feet' is next to impossible in today's society. The public needs to be made aware of who is becoming homeless... and that they could be next - just like any average family," an individual respondent to the national survey from North Carolina reported

World Exports of New and Used Automobiles: A Gravity Model Comparison among the European Union, Japan and the United States

This paper considers new and used automobile exports of the European Union, Japan and the United States within a gravity model framework. This standard framework has similar explanatory power for the new and used automobile exports of the European Union and the United States, as well as for the new automobile exports of Japan, but not for Japan's used automobile exports, a finding the paper associates with the importance of left-hand driving in determining the markets for Japan's used (but not 'made to order' new) automobile exports. The paper concludes that, while used automobiles are somewhat more important to lower income markets, controlling for discrimination and other factors, used automobile trade clearly supplements new automobile trade from the prospective of the importing country.Gravity model, international automobile trade, new trade theory,