TY - JOUR
T1 - Is preserving small, low-end rental housing feasible?
AU - Garboden, Philip M.E.
AU - Newman, Sandra
N1 - Funding Information:
Baltimore’s low-end rental units in small properties fall below the national average in housing and neighborhood quality. Approximately 40 percent of units are substandard, 43 percent of the tenants reported serious crimes in their neighborhoods,20 and 45 percent reported vandalized or abandoned buildings on their block (AHS; US Bureau of the Census 2007b). As shown in Table 6, approximately 95 percent of rental properties in Baltimore contain four or fewer rental units, comprising 59 percent of the rental market in the city. Although rents are lower in larger properties, small properties comprise 51 percent of all units renting below the median, and single-unit properties represent a third of all low-end rentals (AHS; US Bureau of the Census 2007b). With the exception of weatherization funding from the American Recovery and Reinvestment Act (Baltimore Housing 2010c), Baltimore has no supply-side programs focused on small, privately-owned rental properties. On the demand side, Baltimore’s Section 8 voucher program is overwhelmed; the
PY - 2012
Y1 - 2012
N2 - This paper uses multiple national datasets to examine the financial, structural, neighborhood, and tenant characteristics of 1-4 unit low-end rental properties, which house 44 percent of all poor renters in US cities. We investigate the feasibility of two strategies to stabilize these properties: (1) outsourcing property management, and (2) transferring bundles of properties to large owners to generate economies of scale, cash reserves, and lower financing costs. We find that approximately five percent of small affordable rental properties are stable, 65 percent are salvageable but at risk, and about 30 percent are not salvageable. For roughly 19 percent of the salvageable properties, a key problem is high vacancy rates, which could be addressed by professional tenant placement services. Bundling has greater potential, but requires purchases at below market prices, amounting to a subsidy.
AB - This paper uses multiple national datasets to examine the financial, structural, neighborhood, and tenant characteristics of 1-4 unit low-end rental properties, which house 44 percent of all poor renters in US cities. We investigate the feasibility of two strategies to stabilize these properties: (1) outsourcing property management, and (2) transferring bundles of properties to large owners to generate economies of scale, cash reserves, and lower financing costs. We find that approximately five percent of small affordable rental properties are stable, 65 percent are salvageable but at risk, and about 30 percent are not salvageable. For roughly 19 percent of the salvageable properties, a key problem is high vacancy rates, which could be addressed by professional tenant placement services. Bundling has greater potential, but requires purchases at below market prices, amounting to a subsidy.
KW - Affordability
KW - Low-income housing
KW - Management
KW - Rental housing
UR - http://www.scopus.com/inward/record.url?scp=84868109402&partnerID=8YFLogxK
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U2 - 10.1080/10511482.2012.697909
DO - 10.1080/10511482.2012.697909
M3 - Article
AN - SCOPUS:84868109402
SN - 1051-1482
VL - 22
SP - 507
EP - 526
JO - Housing Policy Debate
JF - Housing Policy Debate
IS - 4
ER -