Get access

The Impact of Housing Rehabilitation on Local Neighborhoods: The Case of Small Community Development Organizations

Authors


  • We thank Richard W. Lang for his valuable comments and suggestions. The article also benefited from discussions with Dede Myers, Sean Closkey, and Ira Goldstein and the comments of two anonymous referees. A special thanks to the late Edward M. Gramlich, Governor of the Federal Reserve Board, who, after visiting St. Joseph's Carpenter Society, recommended that we undertake this study.

  • The views expressed here are those of the authors and do not necessarily represent the views of the Federal Reserve Bank of Philadelphia or the Federal Reserve System.

Abstract

Across the nation, nonprofit organizations located in poor and declining neighborhoods are promoting homeownership in the hopes that their efforts will stave off decline and contribute to neighborhood stability. A common homeownership strategy among nonprofits is to acquire boarded-up or deteriorated homes at a low price, rehabilitate them, and then sell them at an affordable price. As these programs continue, nonprofit organizations want to show quantitatively that neighborhood revitalization works—that the funds devoted to an area stabilize neighborhoods or, even more, that they initiate a surge of continued upward progress. But, unlike their larger counterparts, smaller community development organizations are usually at a disadvantage in undertaking such an evaluation. This study will help illustrate what might be done. It focuses on the case of St. Joseph's Carpenter Society (SJCS) in Camden, New Jersey and assesses the quantitative impact that SJCS has on its target neighborhoods. A three-tiered approach is adopted that ranges from a target and comparison area analysis, to regression analysis of SJCS's impact on local housing prices, and finally to an examination of the relative market performance of SJCS's houses. All told, the analysis suggests that SJCS's rehabilitation and homeownership education activities appear to have a positive influence on the neighborhoods in its target area.

Ancillary