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Keeping the Neighborhood Affordable

A Handbook of Housing Strategies for Gentrifying Areas

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Document date: March 17, 2006
Released online: March 17, 2006

The nonpartisan Urban Institute publishes studies, reports, and books on timely topics worthy of public consideration. The views expressed are those of the authors and should not be attributed to the Urban Institute, its trustees, or its funders.

Note: This report is available in its entirety in the Portable Document Format (PDF).

The text below is a portion of the complete document.


Housing prices began to rise nationally in the mid-1990s and continue to do so in both rental and sales markets in many communities across the U.S. While some observers are concerned that we are experiencing a housing bubble that eventually will burst, leading to drops in house values, low- and moderate-income people at present face increasingly limited affordable housing options as long-disinvested neighborhoods experience renewed attention. Gentrification and neighborhood revitalization raise the issue of whether it is possible to manage neighborhood investment so that positive neighborhood change can occur without displacing lower-income residents.

This handbook describes a wide range of strategies that local governments, developers, and nonprofit organizations can use to create and retain affordable housing in their communities. In the companion report to this handbook, In the Face of Gentrification: Case Studies of Local Efforts to Mitigate Displacement, we present six case studies of local efforts to create affordable housing and reduce displacement of lower-income residents. Stakeholders can have an impact on the availability of affordable housing in revitalizing areas if there is the commitment to do so.

This handbook is intended to support local efforts by providing an overview of strategies for addressing affordable housing. The strategies are divided into three categories: housing production, housing retention, and asset building. After describing each strategy, we consider possible outcomes and implementation challenges. This document adds to the body of literature on affordable housing strategies by considering the interplay of strategy implementation and housing-market context. For example, efforts to build new affordable housing in a neighborhood where prices already are high will need to take a different approach from that used in an area with a weaker housing market. (See In the Face of Gentrification for a discussion of strategies and market context.)

We present the strategies in the following order. Though some of these strategies are not necessarily intended to create or retain affordable housing, for example tax-increment financing, they can be used toward that end.

  • Housing Production
  • Housing Trust Funds
  • Inclusionary Zoning Ordinances
  • Low-Income Housing Tax Credits
  • Split-Rate Tax Structure
  • Tax Increment Financing
  • Housing Retention
  • Code Enforcement
  • Rent Control
  • Preservation of Federally Subsidized Housing (Section 236 and Project-Based Section 8)
  • Tax Relief Assistance
  • Asset Building
  • Individual Development Accounts (IDAs)
  • Homeownership and Education Counseling
  • Limited Equity Housing Co-ops (LEHCs)
  • Community Land Trusts (CLTs)
  • Location Efficient Mortgages (LEMs)
  • Section 8 Homeownership Program

Note: This report is available in its entirety in the Portable Document Format (PDF).



Topics/Tags: | Cities and Neighborhoods | Housing


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