Does the Low-Income Housing Tax Credit Program Expand Access to Opportunity Neighborhoods? Tracking Movements of Low-Income Tenants in California

Abstract

The Low-Income Housing Tax Credit (LIHTC) program can potentially help expand access to neighborhoods with low poverty and economic opportunities for low-income households. Prior studies described that LIHTC units are in neighborhoods with relatively high poverty, but with improvements in recent years. Beyond cross-sectional analyses, scholars have not extensively looked at the movements of tenants. It remains unclear whether the program creates opportunities for low-income households to move into better neighborhoods than they previously lived in or reinforces segregation by encouraging moves to similarly or more disadvantaged neighborhoods. Using an extensive consumer database, I am tracking the movements of households who move into new LIHTC properties in California. The experimental findings show that residents experience, on average, increases in poverty exposure by up to six percentage points over other moved low-income renters. Tenants see lower levels of neighborhood amenities than at their previous addresses. The construction of LIHTC housing can increase the chance of households moving into minority-concentrated areas.