Authors’ Blog: Housing Choice Voucher Holders and Neighborhood Crime: A Dynamic Panel Analysis from Chicago

This is an author-produced blog post to introduce upcoming Urban Affairs Review articles. This article is now available in OnlineFirst


Housing Choice Voucher Holders and Neighborhood Crime:
A Dynamic Panel Analysis from Chicago

Leah Hendey,* George Galster,** Susan J. Popkin,* Chris Hayes*

* Metropolitan Housing and Communities Policy Center, Urban Institute
** Department of Urban Studies and Planning, Wayne State University


Efforts to “deconcentrate poverty” through the Housing Choice Voucher (HCV) program could potentially produce unintended adverse consequences for the neighborhoods into which HCV holders move.  The most salient concern expressed has been reputed upsurges in violent and property crime.  To date, there is limited credible evidence on this issue, as scholars must successfully confront two fundamental challenges. First, causation may operate in both directions.  In-migrating HCV holders could increase crime rates as many have speculated, but they may also be more likely to move to neighborhoods where crime is already increasing because rents are cheaper there and landlords may be more actively recruiting them there.  Secondly, any observed positive relationship between crime and HCV holders may be spurious if the growth of both in a neighborhood is caused by other (often hard-to-measure) neighborhood characteristics that are not statistically controlled.
Our study advances the literature by overcoming these two empirical challenges of reverse causation and omitted variables bias.  Our research question is:  Are quarterly changes in either violent or property crime rates positively correlated with the lagged change in resident HCV holder rate, controlling for the lagged change in crime rate in the given and nearby neighborhoods?  We specify a theoretical model of how rents, crime and HCV concentrations are related, which in turn generates an empirical model that overcomes the two aforementioned challenges because it is based on changes in the above variables, not levels.  We estimate parameters of this dynamic panel model employing quarterly data for 803 Chicago census tracts from October 1999 to December 2008.  Since our core model finds no crime impacts generally, we then test whether the potential criminogenic effects of increasing numbers of HCV holders may be contingent on context. That is, we explore whether the results differ for low versus high poverty/crime neighborhoods or for those surpassing a particular concentration of HCV holders.
One of the principal results of interest is that there is no relationship between growth in HCV holder rates and growth in either property or violent crime rates in low-poverty neighborhoods, yet there are distinct differences in these in other contexts.  Only with property crime does the conventional wisdom ever receive support, and then only under the contingency of above-median neighborhood poverty rates and/or above-threshold HCV holder rates.  This result could be the product of systematically weaker collective efficacy, social norms more tolerant of property crime, less-frequent and effective property security systems, and/or less-deterring public safety forces in such neighborhoods.  Surpassing threshold HCV holder rates (likely coupled with concentrations of other, non-subsidized low-income households) may itself produce endogenous changes in one or more of the foregoing elements. 
By contrast, we found an unexpected, modest-but-consistently negative relationship between changes in HCV holder rates and violent crime in poorer neighborhoods.  Poor neighborhoods are likely to have an above-average percentage of residential vacancies in Chicago; indeed this is a primary reason why landlords are more apt to accept and even recruit HCV holders in such areas.  However, not all areas will be equally successful in stemming the rising tide of vacancies in this fashion as others, and the ones that do apparently reap the benefit of less violent crime. Though for reasons that are not entirely clear, it may be that lower vacancies associated with more HCV in-migration might translate into fewer unoccupied properties that could serve as criminal lairs and venues for committing violent acts, as is commonly believed.  We stress that the previous arguments are speculative and require further investigation and replication in other cities.
            The second finding of interest is that there is no evidence that a growth in HCV holders produces a subsequent growth in either type of crime if they remain a modest share of a neighborhood’s households.  We observed that there may be such an effect for property crime when the HCV rate exceeds roughly seven percent of the tract’s households.
In conclusion, our findings indicate there is no negative impact from the movement of HCV holders into a neighborhood on violent crime overall or on any type of crime in lower-poverty/crime neighborhoods and those with low rates of HCV holders.  This result presents a stark contrast to the frequent portrayal of the relationship between violent crime and HCV holders in the popular press. However, there may indeed be cause for concern that more HCV holders can modestly increase property crime rates in higher-poverty/crime neighborhoods and/or if they exceed a threshold concentration.

A crucial housing policy implication following from this conclusion is the need to find better strategies to avoid the concentration of HCV holders, especially in poor, crime-ridden communities.  There has been considerable discussion about how this can best be accomplished.  The suggested reforms have included: (1) direct leasing, counseling and brokerage for connecting HCV holders to housing in good neighborhoods; (2) financial incentives to HCV holders and potential HCV landlords in desirable areas, such as raising Fair Market Rent levels there or establishing locally based FMRs; (3) PHA performance incentives rewarding those who help HCV holders move outside disadvantaged neighborhoods and avoid re-concentrating; (4) end PHA administration of vouchers and instead use non-profit organizations with metro-wide coverage; (5) Prohibitions on the use of HCVs in certain neighborhoods or requirements that they can only be used in more “opportunity rich” neighborhoods; (6) abolition of reductions in tenant out-of-pocket contributions to contract rent if they lease below-FMR apartments; (7) requirements for all landlords to participate in HCV program upon request; (8) intensified fair housing enforcement aimed at expanding choices for users of HCVs who are minority and families with children.  It is beyond the scope of this paper to evaluate these options; suffice it to emphasize that our results regarding thresholds add to the urgency of implementing one or more of them.

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