Determinants of the Incidence of Loan Modifications
Loan modifications ensure that borrowers avoid foreclosure and save their credit record. These modifications are also beneficial to the neighborhoods in which these borrowers reside, preventing vacancies and high rates of turnover. This analysis looks at loan delinquency and repayment plan data from New York City borrowers to provide the strongest predictors of modifications or liquidation of property. In this paper, we answer key questions about loan modifications, including how the identity, property or neighborhood of the borrower affects the likelihood of receiving a modification. We also look at the role of residential segregation, as well as the identity of the loan’s servicer as an influence on variations in borrower access to loan modifications.
The Role of Neighborhood Characteristics in Mortgage Default Risk: Evidence from New York City
We construct a database of non-prime hybrid adjustable and fixed rate mortgages from New York City that augments a rich set of loan and borrower risk characteristics with a variety of census tract level neighborhood characteristics. We find that these neighborhood characteristics are important for default behavior, even after an extensive set of controls. First, default rates increase with the rate of foreclosure notices and the number of lender-owned properties (REOs) in the tract. Second, default rates for home purchase mortgages are higher in predominantly black tracts, regardless of the borrower’s own race. We explore possible explanations for our findings.
Rental Housing Policy in the United States
In this volume of the U.S. Department of Housing and Urban Development’s policy development and research journal, Cityscape, guest editors Vicki Been and Ingrid Gould Ellen bring together seven innovative proposals from leading housing researchers calling for changes in government policies to benefit renters and their communities. This collection of articles propose reforms, such as the elimination of the mortgage interest deduction, which could serve as viable alternatives to traditional federal rental programs. These perspectives offer U.S. policymakers ways to potentially adapt international housing assistance models to reform the domestic housing market.
Matching Words and Deeds? How Transit-Oriented are the Bloomberg-era Rezonings in New York City?
Anticipating that New York City will grow to more than nine million residents by 2030, the City has launched an ambitious planning agenda focused on development in neighborhoods well served by public transit. Between 2002 and 2009, New York City’s government enacted 100 significant changes to its zoning code, constituting the most significant change to the City’s land use regulations since the original version of the current zoning code was adopted in 1961. This chapter explores the cumulative impact of the individual zoning actions on residential capacity, and how the rezonings match the City’s stated development, environmental and transportation goals. The authors found that, consistent with desired development patterns, there has been a modest overall increase in residential capacity concentrated in neighborhoods near rail transit stations.
Foreclosure and Kids: Does Losing Your Home Mean Losing Your School?
The second in a two-part series on the effects of the foreclosure crisis on children, this report addresses the relationship between foreclosure and student mobility. New York University’s Institute for Education and Social Policy (IESP) and Furman Center for Real Estate and Urban Policy find that New York City public school students living in buildings entering foreclosure are more likely to switch schools than their peers, less likely to leave the school system, and that their new schools tend to be lower performing than the ones they left.
Does Losing Your Home Mean Losing Your School?: Effects of Foreclosures on the School Mobility of Children
In the last few years, millions of homes around the country have entered foreclosure, pushing many families out of their homes and potentially forcing their children to move to new schools. Unfortunately, despite considerable attention to the causes and consequences of mortgage defaults, we understand little about the distribution and severity of these impacts on school children. This paper takes a step toward filling that gap through studying how foreclosures in New York City affect the mobility of public school children across schools. A significant body of research suggests that, in general, switching schools is costly for students, though the magnitude of the effect depends critically on the nature of the move and the quality of the origin and destination schools.
Decoding the Foreclosure Crisis: Causes, Responses and Consequences
In a Point/Counterpoint exchange, Furman Center researchers discuss the causes and consequences of the foreclosure crisis. Each of the Point/Counterpoint teams was asked to address a set of questions covering the scope and causes of the foreclosure crisis, whether the federal policy response was appropriate, and how the future of mortgage lending may change in response to the crisis.
Minimum parking requirements and housing affordability in New York City
Many cities throughout the United States require developers of new residential construction to provide a minimum number of accompanying off-street parking spaces. However, critics argue that these requirements increase housing costs by bundling an oversupply of parking with new housing and by reducing the number of units developers could otherwise fit on a given lot. In this article, we explore the theoretical objections to minimum parking requirements and the limited empirical literature. We then use lot-level data and GIS to analyze parking requirements in New York City to determine to what extent they are already effectively sensitive to transit proximity. Finally, we examine developer response to parking requirements by comparing the number of spaces that are actually built to the number required by applicable zoning law. Our results indicate that the per-unit parking requirement in New York is, on average, lower in areas near rail transit stations, but the required number of spaces per square foot of lot area is higher, on average, in transit accessible areas. We also find that by and large, developers tend to build only the bare minimum of parking required by zoning, suggesting that the minimum parking requirements are binding for developers, as argued by critics, and that developers do not simply build parking out of perceived marked need. Our results raise the possibility that even in cities with complex and tailored parking requirements, there is room to tie the requirements more closely to contextual factors. Further, such changes are likely to result in fewer parking spaces from residential developers.
How do New York City’s Recent Rezonings Align With its Goals for Park Accessibility?
In 2007, New York City adopted a long-term sustainability plan that announced a goal of ensuring that almost every New Yorker lives within a ten minute walk of a park of substantial size. At the same time, policymakers are rewriting the City’s land use map through an unprecedented series of neighborhood level rezonings that involve changing the use type and residential capacity of affected lots or groups of lots. Despite the confluence of these interventions, no research has analyzed how the rezonings interact with the City’s park infrastructure, and specifically, whether residential capacity changes in areas close to parks differ from those in areas further away. In this research, we employ a database of every tax lot in New York City to investigate how well the City-initiated rezonings correlate with the goal of providing New Yorkers with good access to the City’s parks. Our results indicate a mixed picture; while most ‘upzoned’ lots (lots where residential capacity was added) were near parks, we also find that the majority of ‘downzoned’ lots (lots where residential capacity was reduced) were also close to parks. The net impact of these rezonings was a modest increase in residential capacity for the City as a whole, but the increases were disproportionately focused in areas further from parks.
Kids and Foreclosures: New York City
While researchers have noted the deleterious effects of foreclosure on surrounding properties and neighborhoods, little is known about the effects of foreclosure on children. This report by researchers at New York University’s Institute for Education and Social Policy (IESP) and Furman Center for Real Estate and Urban Policy begins to address the issue by estimating the number of students in New York City affected by the current foreclosure crisis.