Geographic and Temporal Variation in Housing Filtering Rates
41 Pages Posted:
Date Written: January 27, 2020
In Housing Economics, filtering is the process by which properties, as they age, depreciate in quality and hence price and thus tend to be purchased by lower-income households. This is the primary mechanism by which competitive markets supply low-income housing. While at the national level filtering is an important long-term source of lower-income housing, this research shows that there is a wide range of filtering rates both across and within metropolitan statistical areas (MSAs) for owner-occupied properties. Notably, in some markets, properties “filter up” to higher-income households. This paper contributes to our understanding of filtering by demonstrating the heterogeneity of filtering rates. The analysis finds strong geographic and temporal variation in filtering rates.
Keywords: filtering, affordable housing, repeat income model
JEL Classification: R21, R31, R38
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