New Cityscape Examines Housing Tenure and Financial Security

HUD's Office of Policy Development and Research

The Spring issue of Cityscape: A Journal of Policy Development and Research features a symposium examining the role of homeownership in securing residential stability, building wealth, and achieving financial security for American families, with a particular focus on the decade following the Great Recession. The issue was guest edited by Jaclene Begley, Christopher Herbert, Michael LaCour-Little, Kristin Perkins, and Jonathan Spader.

Anna Jefferson and Hannah Thomas present novel ethnographic research into how lower- and moderate-income homebuyers access information about mortgages and how that information shapes their mortgage shopping in three phases of the homebuying process. Drawing from video and interview data from 14 low-income first-time homebuyers in Boston, Massachusetts, and Knoxville, Tennessee, the authors show how the mortgage shopping behavior of their research subjects can differ from best practices.

Ann Carpenter, Taz George, and Lisa Nelson analyze transactions in six Midwestern states to understand trends in contracts for deed, a form of seller-financing, in the region before and after the Great Recession. The researchers found contracts for deed tend to be more concentrated in lower-income neighborhoods with higher shares of nonwhite residents, higher vacancy rates, and less access to traditional mortgage credit.

Kerry Spitzer and Lauren Lambie-Hanson explore the factors influencing the share of mortgages that are insured by the Department of Veterans Affairs. They find that the presence of active-duty military bases is surprisingly important, even controlling for the number of veterans.

Brielle Bryan investigates how different levels of contact with the criminal justice system, including arrest, criminal charges, conviction, and incarceration relate to aspects of homeownership. While the negative effect of incarceration on homeownership had been documented previously, this research demonstrates how lower-level forms of criminal justice contact are independently associated with a lower level of homeownership, delayed entry into homeownership, and shorter duration of homeownership.

Kristin L. Perkins, Shannon M. Rieger, Jonathan Spader, and Christopher Herbert examine the potential for shared equity — an alternative ownership model that provides a substantial upfront reduction in the purchase price of a home — to expand homeownership access in the U.S. With shared equity assistance of $25,000 to $100,000, the authors found that 6.6 million potential homeowners could purchase a home in their county; with financial assistance of $100,000 or more, an additional 8.6 million would be able to purchase a home. With relatively modest assistance of $10,500, the authors found that 15.2 million potential homeowners would be able to buy.

Jake Interrante and Elliot Schmiedl compare the actual wealth building outcomes in the state-subsidized Massachusetts Housing Partnership's ONE Mortgage Program to hypothetical outcomes for comparable borrowers receiving a Federal Housing Administration (FHA) insured mortgage. Overall, the researchers found that participants in the ONE Mortgage Program accrued greater overall benefits than they would have received with FHA loans.


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Posted May 13, 2020

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