Vouchers Versus Production Revisited

22 Pages Posted: 30 Mar 2000

See all articles by Mark D. Shroder

Mark D. Shroder

U.S. Department of Housing and Urban Development - Position given for identification purposes only. The Department of HUD is not responsible for any opinions expressed in this publication.

Arthur J. Reiger

U.S. Department of Housing and Urban Development

Date Written: February 7, 2000

Abstract

Policy makers who want to help house low-income families might either fund production of new units or supplement the payments families make for existing units. Conventional wisdom holds that production costs more, but McClure (1998) claimed long-term discounted costs of project-based and tenant-based housing assistance may not be very different.

Using large HUD data systems for assisted tenants, we find that 15-20 years after construction, Section 8 New Construction/Substantial Rehabilitation (NC/SR) projects remained considerably more expensive than Section 8 Certificates. The Federal government could not use construction guarantees to preempt rent inflation. Rents for units that developers wanted to build are higher than comparable certificate rents, even in the most inflated markets.

JEL Classification: H2, I3, R0

Suggested Citation

Shroder, Mark D. and Reiger, Arthur J., Vouchers Versus Production Revisited (February 7, 2000). Available at SSRN: https://ssrn.com/abstract=218288 or http://dx.doi.org/10.2139/ssrn.218288

Mark D. Shroder

U.S. Department of Housing and Urban Development - Position given for identification purposes only. The Department of HUD is not responsible for any opinions expressed in this publication. ( email )

451 Seventh Street SW
Washington, DC 20230
United States

Arthur J. Reiger (Contact Author)

U.S. Department of Housing and Urban Development ( email )

451 Seventh Street SW
Washington, DC 20410
United States

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