The Performance of Non-profit Housing Developments in the United States

Abstract

Over the past two decades, non-profit organisations have played an increasingly important role in meeting the housing needs of low and moderate-income families. Not enough is known, however, about the performance of the housing developments sponsored by non-profit organisations. The purposes of the research described in this paper were: to assess the performance of a sample of housing developments sponsored by non-profit organisations in the US; to identify the factors that affect that performance and; to identify the lessons learned about effective project development and management. These questions are examined by studying the performance of 36 developments that received the Fannie Mae Foundation's Maxwell Award between 1989 and 1994. The results indicate that all the developments continue to provide decent, affordable housing for low-income persons. A major threat to the future viability of the rental and special needs developments, however, is the lack of adequate operating and replacement reserves. The most important factors in performance are stability in the leadership of the sponsoring organisations, local demand for affordable housing, the terms of the permanent financing and the screening and selection of tenants. Lessons learned from the experience of the developments studied and policy recommendations are presented.