Wednesday, July 2, 2008

The foreclosure crisis: local government to the rescue?

Suburb2    Okay, here’s your challenge, local government:  You’ve got an explosion in home foreclosures, which pushes thousands out of their homes, pulls down neighborhood values even further, encourages crime, and shrinks government tax coffers.  And for years, you’ve fretted about the problem of “affordable housing” for modest-income families, because of high prices and high demand.  Is there a potential solution worth trying?    
   In Fairfax County, Va., which is very large (population: 1.1 million), very affluent, and increasingly diverse, the county government is beginning a plan to buy up some houses at foreclosure.  These purchases would take advantage of fire sale prices (sometimes, close to literally), keep the houses occupied and away from vandals (if government handles its purchases well), and helps the county make more housing units more affordable.  Is it a win-win idea?  Perhaps.  How many houses will the county buy?  The program will spend about $10 million, which will enable it buy … 10 houses outright, and help up 200 other buyers through government loans.  These numbers compare to the total of more than 1,700 homes that went into foreclosure in Fairfax during the past 12 months.  These staggering numbers show how difficult it is, or would be, for local government to “bail out” homeowners by itself ...

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July 2, 2008 | Permalink | Comments (0) | TrackBack (0)

Tuesday, July 1, 2008

A depressing story about social integration … and crime …

   In this space and elsewhere, I have written about the success and promise of better-low cost housing and better social understanding offered by the federal “section 8” voucher program and other efforts to integrate recipients of housing assistance within a mixed community.  In fact, almost every optimistic thinker has had good thoughts about the policy of moving away from crime-ridden urban housing projects in favor of integration, such as the once-famously successful results of the Gautreaux litigation in the 1970s and 80s.  Remove poor families from the toxic atmosphere of the projects, the argument went, and you encourage them to be better citizens, and at the same time you foster better understanding between poorer and wealthier Americans.
Memphis    So it was truly depressing to read a story by Hanna Rosin in this month's Atlantic Monthly that relates the dispersion of low-income households with the spread of crime in cities such as Memphis, Louisville, and elsewhere.  Rosin argues that spikes in crime in many moderately sized cites correlate with policies that subsidize housing for poor urban families in new neighborhoods.  She cites a study by Wayne State’s George C. Galster that shows, while the concentration of poverty has fallen in recent decades, the number of neighborhoods with a moderately high number of poor households has increased, and that crime rates often rise significantly in these communities with moderately high poverty rates.   
   A reason for the disappointment, Rosin suggests, is that the early reports of success from the Gautreaux litigation and similar efforts were based on small numbers of unusually motivated poor families who moved away from the projects and found success.  With the rapid growth of the voucher programs, however, poor families have not spread out widely, but have largely re-concentrated in moderately priced neighborhoods (with housing prices so high, they had no choice).  If a critical mass of unmotivated poor youths develops in a neighborhood, the argument appears to run, this mass often re-generates the gang and crime culture of the projects. 
   These depressing reports certainly will reinforce opposition in suburban neighborhoods to greater integration with housing assistance recipients.  And so the thinkers and policy-makers head back, once again, to the drawing boards …

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July 1, 2008 | Permalink | Comments (1) | TrackBack (0)