The researchers examine two Nehemiah developments subsidized by the City of Philadelphia that offer newly constructed homes at well below cost. This paper uses a unique survey of these new owners to measure what Nehemiah residents gain in terms of structure and community attributes as they make the transition from renting to owning. The new owners in the Nehemiah complex significantly improve their housing structures while raising their exposure to crime and weak local public schools.

As part of the City's community development strategy, these developments were expected to increase economic activity near these sites. The researchers document that there is no evidence of "local benefit spillovers" for census tracts where the Nehemiah was built. The survey results suggest that the new housing complex represents an "oasis" where there are few interactions between the new home owners and the incumbent residents of the greater community.

The City of Philadelphia has made a strong commitment to promoting homeownership as part of its overall community development strategy. The City provides people-based subsidies for homeownership through its Settlement Grant program, which offers qualifying households up to $1,000 to help cover closing costs to purchase a home. In addition, the City provides place-based subsidies, which is the focus on in this paper.

For Nehemiah households, their gains in housing structure come at a substantial cost to them through a marked decline in community quality of the surrounding area from their previous neighbourhood. The survey results indicate that Nehemiah households recognize the problems with their location but seem to view the gains in structure as worth the cost.

In part, their view of this trade-off may be due to the fact that these households seem to define their community as the Nehemiah development itself, rather than as the larger area around their homes. The researchers find no evidence that these developments have spurred private investment or raised home prices in nearby areas.

City Research
Jean L. Cummings

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01/10/2001

Jean L. Cummings, Matthew E. Kahn and Denise DiPasquale

research

Urban Policy > Social inclusion & integration

Community development