Subsidized housing

Subsidized housing is any government sponsored economic assistance program aimed towards alleviating housing costs and expenses for impoverished people with low to moderate incomes, who may often be disadvantaged minorities. Beneficiaries often have lower job and social skills, and lower IQs, though the significance of this fact is intensely disputed. Forms of subsidies include direct housing subsidies, non-profit housing, public housing, rent supplements, and some forms of co-operative and private sector housing. In the United States, subsidized housing is often called "affordable housing." One major American program is known as Section 8 housing.

Housing is said to be a fundamental right recognized as a Human Right. There is some scientific research suggesting that actions to facilitate people's access to housing contributes to lower poverty levels, though various self-destructive behaviors may negate these gains..

Subsidized housing may also serve social and political purposes extending beyond these programs direct beneficiaries. Since the latter half of the twentieth century, American opinion and policy leaders (generally inspired by left-wing ideals, but supported by mainstream conservatives) have expressed a preference to move non-white minority groups (especially African Americans) out of their traditional neighborhoods and into traditionally more white areas. In the USA, this has been widely accomplished through subsidized housing. These policies, supported over decades by such politicians as Ted Kennedy, also have political implications, as Democratic-leaning minorities are relocated to traditionally more conservative suburban or rural areas, sometimes described as flyover country. This may change the vote balance in some congressional districts.

However, there has been resistance to Section Eight housing from local whites, who complain of increasing levels of violent crime, trash and noise problems, and a generally lower quality of life in apartment complexes and neighborhoods where minority groups were encouraged to relocate through vouchers and other subsidies. These opponents claim to be the victims of an implicit conspiracy by so-called cultural elites. Wealthy liberals are said to benefit from minorities moving out of urban areas to remote working-class and middle-class white areas, a process said to lead to increasing property values in the areas vacated by these minorities, which may then be gentrified. High-income liberal areas that have seen both increased property values and a reduced minority presence include New York City and Chicago. Similar outcomes have been achieved through local building restrictions and other covenants in places like Portland, Oregon, and wealthy areas of California like Marin County, and Berkeley.

Right-wing critics claim that different racial groups can not live too closely together for fundamental biological reasons, as they have different inborn levels of trust and aptitude for cooperation. However, such talk is considered politically anathema, and absolutely unacceptable in mainstream debate. Far-right critics may go further, and slam the housing program as "Section Ape", a term which progressive activists consider intensely insulting and racist. As of 2018, subsidized housing programs continue nationwide, but the White House has indicated some willingness to consider reducing their extent.

Types

Co-operative housing

Main article: Housing cooperative

Some co-operative housing may offer subsidized units, but its main mandate is not subsidization. Its operating mandate is to offer non profit housing, where the rents or housing charges as they are called, goes back into the maintenance of the building instead of the profit of a landlord. Co-operative housing is controlled by the members of the co-op, which is run by a board of directors. There is no outside landlord. In most cases, all residents of the co-op become members and are owners, and agree to follow certain by-laws. Some co-ops are subsidized housing because they receive government funding to support a rent-geared-to-income program for low-income residents. There are other co-ops that are market-rate and limited equity, these types of cooperatives do not receive government funding and are not subsidized housing. In addition to providing affordable housing, some co-ops serve the needs of specific communities, including seniors, artists, and persons with disabilities.

Examples of co-operative housing include: College Houses, Urban Homesteading Assistance Board (UHAB), and Habitat '67, and regular rental housing be they regular looking apartments, townhouses or high end buildings such as those overlooking Central Park in New York City.

Housing subsidies

Main article: Housing subsidies

Housing subsidies are government financial assistance to help provide housing. The largest housing subsidy in the US is the home mortgage interest deduction, which allows homeowners with mortgages on first homes, second homes, and even boats with bathrooms to lower their taxes owed. The cost to the federal government of the mortgage interest deductions in 2012 was approximately $110 billion. Some states also have the mortgage interest deduction provision. The majority of the home mortgage interest deduction goes to the top 5% income earners in the United States. Some housing subsidies are also provided to low income tenants in renting housing. These subsidies are often defined by whether the subsidy is given to the landlord and then criteria are set for the tenants they can lease to or whether the subsidy is given to the tenant, typically as a voucher, and they are allowed to find suitable private housing. The subsidy amount is typically based on the tenant's income, usually the difference between the rent and 30% of the tenant's gross income, but other formulas have been used.

In rare cases a financial institution or non-profit organization will provide mortgage loans at rates that are not profitable for the sake of a specific group. In Canada one such organization is Non-Profit Housing Subsidies Canada which provides subsidized mortgage loans to employees and volunteers of other non-profit organizations.

Non-profit housing

Main article: Non-profit housing

Non-profit housing is owned and managed by private non-profit groups such as churches, ethnocultural communities or by governments. Many units are provided by community development corporations (CDCs). They use private funding and government subsidies to support a rent-geared-towards-income program for low-income tenants.

Public housing

Main article: Public housing

Public housing is real property owned and managed by the government. Tenants must meet specific eligibility requirements.

Rent supplements

Rent supplements are subsidies paid by the government to private landlords who accept low-income tenants. The supplements make up the difference between rental "market price" and the amount of rent paid by tenants, for example 30% of the tenants income. These may have the unintended effect of increasing rents at nonsubsidized units, by distorting the local supply and demand. A notable example of a rent supplement in the United States is Section 8 of the Housing Act of 1937 (42 U.S.C. § 1437f).

See also

• HLM (France)
• National Housing Act (Canada)
• Public housing
• Section 8 (housing) (USA)
• Migration of the disadvantaged
• Social welfare
• Welfare state

Further reading

• Koebel, C. Theodore, and Bailey, Cara L., "State Policies and Programs to Preserve Federally Assisted Low-Income Housing", in Housing Policy Debate (journal), v.3, issue 4, 1992, Office of Housing Policy Research, Fannie Mae, Washington, D.C.
• Koebel, C. Theodore, "Shelter and Society: Theory, Research, and Policy for Nonprofit Housing", SUNY Press, 1998. ISBN 0-7914-3789-2
• Minford, Patrick; Ashton, Paul; Peel, Michael; The Housing Morass: regulation, immobility & unemployment, Institute of Economic Affairs, 1987, ISBN 978-0255361989.
• Minford, Patrick; Ashton, Paul; Peel, Michael; The Effects of Housing Distortions on Unemployment, Oxford Economic Papers, New Series, Vol. 40, No. 2 (Jun., 1988), pp. 322–345, Oxford University Press. The authors study the effect of rent subsidies in England on mobility and unemployment.
• UK Housing Review, University of York, England.