More on "Affordable Housing"

Study: Economic Benefits of Affordable Housing(December 23, 2005) --

Affordable housing can fuel local and regional economies and raise property values in surrounding communities, according to an economic impact survey by Econsult Corp.

The findings of the survey, which was commissioned by the Philadelphia Housing Authority, anticipate a positive effect from the $519 million investment by PHA in capital construction spending on nine sites in Philladelphia. When fully completed, the project is estimated to add $1.3 billion to the state’s economy and $788 million to Philadelphia’s economy.

The economic benefits are generated by increased residential property market value in adjacent neighborhoods, which in turn generate increased property tax revenue, along with an increase in jobs and earnings.

“These numbers show that high-quality affordable housing, when developed and managed thoughtfully, presents a tremendous long-term investment opportunity for Philadelphia and the state,” says Carl Greene, PHA’s executive director.

The results of this survey are consistent with the conclusions of two surveys conducted earlier this year by Econsult and Applied Real Estate Analysis Inc. regarding six affordable housing sites already developed by PHA, according to the agency. Those surveys revealed that property values around the sites grew by 142 percent from 1999 to 2004, more than 2.5 times the citywide rate of 55 percent. Econsult estimated that PHA investments have raised residential market value in adjacent neighborhoods by $200 million, generating more than $4 million in increased property tax revenue for Philadelphia.

“In addition to the much needed PHA projects, the City of Philadelphia enjoyed record housing growth for a number of reasons,” says Al Perry, president of The Greater Philadelphia Association of REALTORS®. “Growing popularity of and investment in our Center City District, low mortgage interest rates, a 10-year tax abatement for new construction and property improvements, and the mobilization of a growing real estate professional population targeting empty-nesters and recent college graduates from one of our many premier colleges and universities contributed as well.”

PHA’s affordable housing developments feature architecture similar to market-rate residences, open spaces, and reconfigured streets, which join neighboring communities and encourage private construction. Mixed-income households and opportunities for home ownership contribute to the stability of the neighborhoods.

—By Michele Lerner for REALTOR® Magazine Online