Effects of Low-Income Housing on Property Values

Quick Takeaways

The Urban Institute recently released an affordable housing case study from Alexandria, Virginia. The results indicate that affordable housing has a positive if not zero effect on property values.
“Affordable housing units in above-median-income census tracts are associated with a 0.06 percent increase in property values, and affordable housing units in below-median-income tracts are associated with a 0.17 percent increase in nearby property values.”
“Affordable housing units in Alexandria are associated with an increase in property values of 0.09 percent within 1/16 of a mile [one city block] of a development, on average” and “no effect on properties between 1/16 of a mile and 3/16 of a mile.”

Source: How Affordable Housing Makes Communities Wealthier (California YIMBY, May 18, 2022)

There are many misconceptions about affordable housing, the main one being that they decrease property values. A recent study in Alexandria, Virginia has proven that affordable housing actually increases or has zero effect on property value. Every city faces its own affordable housing challenges, and it is no surprise that California’s real estate market and population make it rife for disagreement on the topic.

The term “NIMBY” stands for “Not in My Backyard” and refers to a person or group of people who do not want affordable housing (or sometimes shelters, treatment centers, even parks or trails” in their backyard, often citing property value, safety, sometimes even aesthetics. “YIMBY” has been offered as a counter term for people who say “Yes” to these additions to the neighborhood.

See References for more information.

References

NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require the member's nar.realtor login.

Impacts of Low-Income Housing on Neighboring Properties

What Is the Impact of Low-Income Housing on Property Values? (A-Mark Foundation, Jul. 25, 2023)

“Research studies into the impact of low-income housing on neighborhood property values have mostly concluded that there was either no impact or positive impacts on property values.”

Study: Building Subsidized Low-Income Housing Lifts Property Values in Neighborhood (Council of Large Public Housing Authorities, Nov. 9, 2022)

“A new peer-reviewed study found that building multiple publicly subsidized low-income housing developments in a neighborhood doesn’t lower the value of other homes in the area and can in fact increase their worth. The study looked at 500 developments built in the Chicago area from 1997-2016 that used the Low-Income Housing Tax Credit (LIHTC). The authors then looked at their influence on over 600,000 nearby residential property sales by using local property assessment and tax records.”

Affordable Housing Has Positive Effect on Home Values (The Denver Channel, May 26, 2022)

“Community members in a specific community will say, ‘Oh, well, they only found those results because that’s in Portland, Oregon. It’s so different from here.’ or, ‘You know, that’s in a whole different state,’” Stacy said. “The arguments you hear are, ‘It’s going to cause more traffic. It’s going to overcrowd our schools. But I think on a lot of cases, those are just kind of excuses for saying, ‘I don’t want people that aren’t like me to live near me.”

Affordable Housing and How to Participate (National Association of REALTORS®, Apr. 8, 2021)

“The need for affordable housing exists in communities across the country. This episode's guest, William Baylor, joins Monica to talk about current federal affordable housing initiatives, as well as the personal initiatives he's involved with in his own market of Birmingham. This episode will provide ideas and resources for how agents can help find rental and purchase opportunities in their marketplaces that are affordable for people with a lower median income.”

Busted: 7 Myths About Affordable Housing (Twin Cities Habitat for Humanity, Feb. 18, 2020)

Affordable housing is often misunderstood, resulting in the following myths: affordable housing drives down property values, affordable housing doesn’t look nice, affordable housing lowers the quality of schools, affordable housing a taxpayer burden, affordable housing increases crime, affordable housing is a handout, and affordable housing only benefits the very poor. Read this article from Habitat for Humanity to find out why these myths are not true.

Opposition to Public Housing (NIMBYism)

Political Leaders Are Finally Responding to the Housing Crisis. They Need to Move Faster. (Politico, Apr. 4, 2024)

“Across the country, there are states and municipalities tackling the same pervasive but tedious problem: overly restrictive zoning that makes it challenging or nearly impossible to build new housing.”

NIMBYs and YIMBYs Have More in Common Than It Might Seem (Time, Feb. 6, 2024)

“Now, it’s the non-home owners, especially in areas where the cost of housing is sky high, who are fighting back. Progressives, who a generation earlier would have questioned any development, today zero in on the dwindling supply of housing. They blame NIMBYs for that undersupply.”

Saying No to NIMBYs: A Planner’s Guide to Mastering Pushback and Passing Zoning Reform (American Planning Association, Nov. 16, 2023)

“Alterations to the status quo inevitably bring pushback — whether it's changes to parking codes, commercial districts, or housing — and the structures and rules of local government that planners are bound to follow give local opponents of zoning reform ample airtime and opportunities to plead their case.”

This Is Public Housing. Just Don’t Call It That. (The New York Times, Aug. 25, 2023)

“Since a shortage of available units is the root cause, many policymakers have focused on relaxing zoning and building rules to speed up construction. The idea is that if supply catches up with demand, prices will eventually fall or at least moderate.

“But since so much new development is aimed at high-end buyers and renters, another group has countered that only interventions like rent control, subsidies and a revival of public housing can truly reduce housing costs.”

Seattle “Social Housing” Initiative Faces Opposition from Established Housing Providers (The Seattle Times, May 6, 2022)

“The Housing Development Consortium argues that Seattle should focus its resources on the existing system for developing and operating affordable housing, which involves a collaboration between the largely federally funded Seattle Housing Authority, local public development agencies and other nonprofit organizations. “

Websites

Housing Opportunity Program (National Association of REALTORS®)

NAR's Housing Opportunity Program helps REALTORS® become leaders in promoting home ownership at local, state and national levels

HUD User (U.S. Department of Housing & Urban Development)

Numerous reports, articles, data sets, and other information on affordable housing from HUD's research department

National Low Income Housing Coalition

Includes numerous studies and reports on the state of affordable housing in the U.S., including the monthly NIMBY Report.

National Housing Conference

A national nonprofit affordable housing advocacy organization, featuring an Affordable Housing Clearinghouse, affordable housing publications and studies, and more

eBooks & Other Resources

eBooks & Audiobooks

The Affordable City (eBook)

Making Housing More Affordable (eBook)

Missing Middle Housing (eBook)

Books, Videos, Research Reports & More

As a member benefit, the following resources and more are available for loan through the NAR Library. Items will be mailed directly to you or made available for pickup at the REALTOR® Building in Chicago.

The Effects of Subsidized Housing on Property Values: A Survey of Research (California Department of Housing & Community Development, 1988) HD 1387 C12e

Growth Management and Affordable Housing: Do They Conflict? (Brookings Institution Press, 2004) HT166 G74

Impacts of Social Housing: Final Report (Canada Mortgage & Housing Corporation, Jan. 1994) HD 1387 C16

Low-Income Homeownership: Examining the Unexamined Goal (Brookings Institution Press, 2002) HD 7287 L68

Why Not in My Backyard? Neighborhood Impacts of Deconcentrating Assisted Housing (Rutgers University - Center for Urban Policy Research, 2003) HD 7293 W52w

Why Not in Our Community? Removing Barriers to Affordable Housing (HUD, 2005) HD7293 Un3wn

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