Spatial Impacts of Local Housing Programs An Empirical Application of a Housing Turnover Model

Abstract

Abstract Given the increasing importance of local governments in determining local housing policy, there is a need for meaningful and yet practical tools to guide policy actions and to assess program impacts. The purpose of this paper is to empirically demonstrate the potential value of a spatial Markov chain turnover model of vacancy transfers in a policy setting. To the extent that voluntary household moves reflect rational decisions that yield increased household welfare, the model may be used as a crude policy guide to determine where program intervention should take place to effectively maximize benefits of policy actions, and to identify probable spillover impacts upon dwelling turnover in alternative local submarkets. While further research development and empirical tests of the model are warranted, the practical policy potential of the approach appears promising.