Homelessness and Housing Market Regulation

Homelessness and Housing Market Regulation

This chapter explores the potential importance of local housing market regulation in determining homelessness in the U.S. I begin with a theoretical discussion of the connection between the operation of local housing markets and the risk that a low income individual or family experiences homelessness. The chapter then turns to a discussion of local housing market regulation and the impacts of such practices on housing costs. I review the existing empirical literature documenting these connections and investigating differences between the operation of less and more regulated housing markets. I also present an empirical profile of more and less regulated housing markets in the U.S. This profile demonstrates that more regulated markets experience slower growth in housing, produce less higher quality housing, experience higher housing price appreciation, and experience much larger increases in the budget shares that renters (and particular, low income renters) devote to housing expenditures. Finally, using a new state-level regulatory index presented in Gyourko, Saiz, and Summers (2006) and the single- night homelessness count presented in the 2008 Annual Homelessness Assessment Report to Congress (AHAR), I explore the direct relationship between housing market regulation and homelessness. The data reveal a striking positive relationship between the degree of homelessness across states and the stringency of local housing market regulation.

Steven Raphael

University of California, Berkeley

November 2009

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By |2018-09-19T07:09:41-07:00January 1st, 2018|Affordability, Efficiency/Growth, Inequality, Land Use Regulation, Reference|