Mixed-Income Housing: Success and Opportunities

October 2, 2017
By Daniel Perez


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Throughout the Tenth District, community organizations and local governments say the largest issue they and their constituents face is a limited supply of affordable housing. In our Tenth District Low- and Moderate Income Economic Conditions report, community organizations have echoed these same concerns.1 Research from the Kansas City Fed shows demand has outstripped supply for some time, with construction of housing near its historical lowest levels.2 In proposing new affordable housing projects, organizations hope to address both the concerns of neighborhoods wary of new projects and provide housing with equal opportunity for all socioeconomic classes. 

One popular option is mixed-income housing: projects that include both subsidized and unsubsidized housing. Housing researcher Robert Chaskin of the University of Chicago and his co-authors have found that mixed-income housing has four theoretical goals: 

  • Attracting external resources to a community
  • Greater accountability and recognition of issues in the neighborhood
  • Increasing social capital for the lowest socioeconomic group
  • Providing learning opportunities for people of different socioeconomic groups

Chaskin and his co-authors conclude that the two most realistic outcomes of affordable housing are increasing accountability and attracting external resources for the community.1 Mixed-income developments also have positive effects for residents. In a later study, Chaskin interviews mixed-income residents and finds families experience increased emotional well-being and increased comfort in new homes.3  

While mixed-income housing has benefits, two central issues arise with its implementation: how to retain the look and feel of a community while assisting residents who may be displaced by a new housing development. New development typically is accompanied by change, which can manifest itself through new residents or architecture. Sharon Zukin, a sociology professor at Brooklyn College, describes how the “cultural capital” of a location may change over time, affecting residents’ ties to what they call home. These changes may lead to uncertainty and lack of trust within the neighborhood.4  

Secondly, mixed-income housing sometimes may lead to resident displacement through tenant screening procedures. For example, a recent HUD publication reports on how 15 percent of applicants for a mixed-income unit were rejected from subsidized housing due to reasons involving credit, past criminal records or prior evictions.6 These guidelines could cause displacement of residents who previously lived in the area but who have minor issues on their record. 

To further combat persistent poverty, developers may want to consider the effect of the new development on existing residents. Programs like HUD’s Moving to Opportunity in the 1990s have relocated residents, and while the research remains mixed on the effectiveness of such programs, further research may find which issues lead to persistent poverty.7

Bibliography

[1] Edmiston, Kelly, Perez, Daniel (2017). “Tenth District Low- and Moderate- Income Economic Conditions,” Federal Reserve Bank of Kansas City LMI Economic Conditions. Retrieved Sept. 28, 2017, from https://www.kansascityfed.org/research/indicatorsdata/lmieconomicconditions/articles/2017/lmi-economic-conditions-fall-2017

[2] Rappaport, Jordan (2017). “The Large Unmet Demand for Housing,” Federal Reserve Bank of Kansas City Macro Bulletin. Retrieved Sept. 28, 2017, from https://www.kansascityfed.org/publications/research/mb/articles/2017/large-unmet-demand-housing

[3] Joseph, M.L., Chaskin, R.J., and Webber, H.S. (2007). “The Theoretical Basis for Addressing Poverty Through Mixed-Income Development,” Urban Affairs Review, 42(3), 369-409. doi:10.1177/1078087406294043

[4] Joseph, M., and Chaskin, R. (2010). “Living in a Mixed-Income Development: Resident Perceptions of the Benefits and Disadvantages of Two Developments in Chicago,” Urban Studies, 47(11), 2347-2366. doi:10.1177/0042098009357959

[5] Zukin, S., Trujillo, V., Frase, P., Jackson, D., Recuber, T., and Walker, A. (2009). “New Retail Capital and Neighborhood Change: Boutiques and Gentrification in New York City,” City & Community, 8(1), 47-64. doi:10.1111/j.1540-6040.2009.01269.x

[6] Brophy, P.C., and Smith, R.N. (1997). “Mixed-Income Housing: Factors for Success,” Cityscape, 3(2), 3-31. Retrieved Sept. 22, 2017, from https://www.huduser.gov/periodicals/cityscpe/vol3num2/success.pdf.

[7] Clampet‐Lundquist, S., and Massey, D. (2008). “Neighborhood Effects on Economic Self‐Sufficiency: A Reconsideration of the Moving to Opportunity Experiment,” American Journal of Sociology, 114(1), 107-143. doi:10.1086/588740