By Richard K. Green, Stephen Malpezzi, and Kiat-Ying Seah
University of Wisconsin Center for Urban Land Economics Research
This study, which reviewed eight prior studies on Low-Income Housing Tax Credit (LIHTC) properties and property values, found no evidence that LIHTC properties cause property values to deteriorate. Instead, contrary to conventional wisdom, this study’s authors discovered that Low-Income Housing Tax Credit developments often cause surrounding property values to increase. They note with interest that past research has generally found that such developments have a more positive impact in higher-income areas.
The researchers then tested those conclusions by measuring the appreciation rates of houses in one Wisconsin city and two counties near LIHTC properties between 1991 and 2000. Their analysis also found no evidence that LIHTC properties caused property values to depreciate, and they found evidence that in Madison, Wisconsin, properties near LIHTC developments actually appreciated more rapidly.