Publications

  • Maintenance and Investments in Small Rental Properties: Findings from New York City and Baltimore

    Nearly half of all poor, urban renters in the United States live in rental buildings of fewer than four units, and such buildings make up nearly half our nation’s rental housing stock. Yet small rental properties remain largely overlooked by researchers. We present two reports—from New York City and Baltimore—both providing suggestive evidence, drawn from a variety of sources, about the characteristics of small rental housing. We find that while small buildings offer lower rents and play a crucial role in housing low-income renters, these lower rents are largely explained by neighborhood location. Ownership matters, however. In New York, lower rents are associated with small buildings with resident landlords. Further, we also find better unit conditions in small rental buildings when compared to most larger properties, especially in small buildings with resident landlords. In Baltimore, we find that smaller-scale “mom-and-pop” owners dominate the small rental property market, but that the share of larger-scale owners increases in higher poverty areas of the city. The properties owned by these larger-scale owners receive fewer housing code violations and that these owners appear to invest more frequently in major improvements to their properties.

  • Buying Sky: The Market for Transferable Development Rights in New York City

    This policy brief analyzes development right transfers in New York City between 2003 and 2011, looking at the prices paid, number of rights transferred, location of the sending and receiving parcels, and legal mechanisms used, in order to shed light on an important but hard-to-track market. The report, “Buying Sky: The Market for Transferable Development Rights in New York City,” examines 243 arms-length transactions for which complete data is available, and finds wide variation in the price paid per square foot of development rights, even for sales within the same neighborhoods, programs, and time periods. See the press release or read the full report.

  • Why It’s So Hard to Storm-Proof an Apartment Building

    If Superstorm Sandy taught us anything, it's that we need housing that can withstand natural disasters. But resiliency efforts often focus on detached, single-family houses and ignore larger multifamily dwellings. There are a huge number of physical, financial, and political obstacles to storm-proof apartment buildings.

  • Shifting the Burden

    Some of New York City’s most valuable properties in its highest-cost neighborhoods are significantly and persistently undervalued, according to Shifting the Burden. The report identifies 50 individual co-ops in 46 buildings that were sold in 2012 for more than the New York City Department of Finance’s estimate of the market value of the entire building. This undervaluation has significant consequences for the distribution of tax burdens in New York City.

  • Transferable Development Rights Programs: ‘Post’ Zoning?

    Transferable Development Rights (TDR) programs allow property owners to sell unused development capacity at their property and transfer it to another site, where it is typically used to increase the permitted size of a development. In recent years, New York City has enacted programs that use TDRs in increasingly sophisticated ways. These uses share three common attributes: an increased focus on directing the location and density at sites that receive development rights; the use of TDRs as an integral component of more comprehensive rezoning initiatives; and the creation of regulatory incentives that strengthen the market for TDRs. In this essay, we conclude that TDRs in New York can no longer be understood just as a creative mechanism to soften the effect of rigid zoning restrictions, but should also be recognized as a tool land use decision makers increasingly use in place of, or in tandem with, upzonings, bonuses, and other devices for increasing density.

  • Essay: Sticky Seconds—The Problems Second Liens Pose to the Resolution of Distressed Mortgages

    To better understand whether and how second liens might prevent efficient resolutions of borrower distress and to assess how second lien holders could be encouraged to cooperate with efficient resolutions without undermining the financial interests of the banks, we reviewed existing data and research, as well as debates among both academics and industry experts about the role second liens might be playing in slowing the recovery of the housing market. This article reports the results of our research and the roundtable discussion. It first explores what we know about the prevalence and delinquency rates of different types of second liens, the extent to which banks are exposed to losses on the liens, and the extent to which the banks already have accounted for those expected losses. It then reviews the various reasons that second liens have interfered with the efficient resolution of distressed mortgages, and documents advances that recently have been made in addressing those problems. Finally, the article examines the most promising proposals for reducing the transaction costs and frictions that are behind many of the current problems second liens are posing, as well as proposals to prevent similar problems from arising in the future. We focus our analysis of solutions on programs to remove barriers to greater coordination between first and second lien holders, rather than on the incentive approaches that have already been attempted.

  • Pathways After Default: What Happens to Distressed Mortgage Borrowers and Their Homes?

    We use a detailed dataset of seriously delinquent mortgages to examine the dynamic process of mortgage default – from initial delinquency and default to final resolution of the loan and disposition of the property. We estimate a two-stage competing risk hazard model to assess the factors associated with whether a borrower behind on mortgage payments receives a legal notice of foreclosure, and with what ultimately happens to the borrower and property. In particular, we focus on a borrower’s ability to avoid a foreclosure auction by getting a modification, by refinancing the loan, or by selling the property. We find that the outcomes of the foreclosure process are significantly related to: the terms of the loan; the borrower’s credit history; current loan-to-value and the presence of a junior lien; the borrower’s post-default payment behavior; the borrower’s participation in foreclosure counseling; neighborhood characteristics such as foreclosure rates, recent house price depreciation and median income; and the borrower’s race and ethnicity.

  • Challenges Facing Housing Markets in the Next Decade: Developing a Policy-Relevant Research Agenda

    This paper proposes a research agenda that addresses the major challenges facing the U.S. housing market: the long-term effects of the housing market crisis on today’s households and on the next generation, increasing poverty coupled with persistently high income inequality and volatility, continued concentration of poor and minority households in low-quality housing and low-opportunity neighborhoods, and the growing need for sustainable and resilient buildings and communities. This analysis is a framing paper for the What Works Collaborative, a foundation-supported research partnership that conducts timely research and analysis to help inform the implementation of an evidence-based housing and urban policy agenda.

  • Searching for the Right Spot: Minimum Parking Requirements and Housing Affordability in New York City

    The policy brief examines New York City’s minimum residential parking requirements in communities throughout the city and explores the possible effects on housing affordability and on the city’s sustainability goals. The brief finds that the requirements may be causing developers to supply more off-street parking spaces than they expect tenants and homebuyers to demand, potentially driving up the cost of housing and promoting inefficient car ownership.

  • Loan Modifications: What Works

    We use a unique dataset that combines data on loan, borrower, property, and neighborhood characteristics of modified mortgages on properties in New York City to examine the determinates of successful modifications. From November 2007 through March 2011, over 2.1 million mortgages were modified in the United States, and policymakers have heralded such modifications as a key to addressing the ongoing foreclosure crisis. This dataset includes both HAMP modifications and proprietary modifications. The analysis builds upon a prior paper in which the determinants of loan modifications were examined.