Found 2 article(s) for author 'rental markets'

Do the Poor Pay More for Housing? Exploitation, Profit, and Risk in Rental Markets

Do the Poor Pay More for Housing? Exploitation, Profit, and Risk in Rental Markets. Matthew Desmond, 2019, Paper, “This article examines tenant exploitation and landlord profit margins within residential rental markets. Defining exploitation as being overcharged relative to the market value of a property, the authors find exploitation of tenants to be highest in poor neighborhoods. Landlords in poor neighborhoods also extract higher profits from housing units. Property values and tax burdens are considerably lower in depressed residential areas, but rents are not. Because landlords operating in poor communities face more risks, they hedge their position by raising rents on all tenants, carrying the weight of social structure into price. Since losses are rare, landlords typically realize the surplus risk charge as higher profits. Promoting a relational approach to the analysis of inequality, this study demonstrates how the market strategies of landlords contribute to high rent burdens in low-income neighborhoods.Link

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Are Landlords Overcharging Housing Voucher Holders?

Are Landlords Overcharging Housing Voucher Holders? Matthew Desmond, June 26, 2016, Paper. “The structure of rental markets coupled with the design of the Housing Choice Voucher Program (HCVP), the largest federal housing subsidy for low-income families in the United States, provides the opportunity to overcharge voucher holders. Applying hedonic regression models to a unique data set of Milwaukee renters combined with administrative records, we find that vouchered households are charged between $51 and $68 more in monthly rent than unassisted renters in comparable units and neighborhoods. Overcharging voucher holders costs taxpayers an estimated $3.8 million each year in Milwaukee alone, the equivalent of supplying 620 additional families in that city with housing assistance. These findings suggest that the HCVP could be made more cost-effective—and therefore more expansive—if overcharging were prevented.Link

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