Title

Local Effects of Large New Apartment Buildings in Low-Income Areas

Authors

Brian J. Asquith, W.E. Upjohn Institute for Employment ResearchFollow
Evan Mast, University of Notre DameFollow
Davin Reed, Federal Reserve Bank of Philadelphia, Community Development Outreach DepartmentFollow

Upjohn Author ORCID Identifier

https://orcid.org/0000-0002-5783-5557

Publication Date

8-1-2022

Source

The Review of Economics and Statistics 105(2): 359-375

Abstract

We study the local effects of new market-rate housing in low-income areas using microdata on large apartment buildings, rents, and migration. New buildings decrease rents in nearby units by about 6 percent relative to units slightly farther away or near sites developed later, and they increase in-migration from low income areas. We show that new buildings absorb many high-income households and increase the local housing stock substantially. If buildings improve nearby amenities, the effect is not large enough to increase rents. Amenity improvements could be limited because most buildings go into already-changing neighborhoods, or buildings could create disamenities such as congestion.

DOI

10.1162/rest_a_01055

Publisher

The MIT Press

Subject Areas

Regional collaboration; Urban issues; Transportation and infrastructure