Is something better than nothing? The impact of foreclosed and lease-purchase properties on residential property values

《Is something better than nothing? The impact of foreclosed and lease-purchase properties on residential property values》

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关键字: affordability; externality; foreclosure; hedonic model; low-income housing; random coefficient model; MORTGAGE FORECLOSURES; NEIGHBORHOOD IMPACTS; HOUSING PRICES; WASTE SITES; HOMEOWNERSHIP; PROGRAM

作者单位: [Seo, Youngme] Ryerson Univ, Toronto, ON, Canada. [Craw, Michael] Univ Arkansas Little Rock, Little Rock, AR USA. Seo, Y (reprint author), Ryerson Univ, Ted Rogers Sch Management, Real Estate Management, 55 Dundas St West, Toronto, ON M5G 2C3, Canada. E-Mail: ymseo@ryerson.ca

摘要: Lease-purchase (L-P) programmes that rehabilitate foreclosed property for sale as affordable housing may provide a way to reduce foreclosure externalities on nearby property values. This paper investigates the feasibility of such a strategy by estimating the effects of foreclosed properties on nearby residential property values compared with those of an L-P programme operated by the Cleveland Housing Network, Cleveland, Ohio. The findings indicate that although both L-P and foreclosed properties have a negative effect on the value of nearby non-distressed homes, the negative effect of foreclosure is larger. At the same time, the scope of the foreclosure externality is greater in low- and moderate-income neighbourhoods, while the foreclosure externality is generally smaller in high income neighbourhoods. Such results imply that an L-P strategy is likely to be more effective in offsetting foreclosure externalities in low- and moderate-income neighbourhoods than in high income neighbourhoods.