Professor Steve Bourassa of the Washington Center for Real Estate Research (WCRER) and Runstad Department of Real Estate was quoted in a story entitled “Listings are up, interest rates may come down.” Read the full article here.
Research Theme: Economy & Finance & Development
Includes real estate finance and markets as well as economics and community development, from the scales of the building to the region
Gregg Colburn cited in the Council of Economic Advisors 2024 Economic Report of the President
Associate Professor Gregg Colburn in the Runstad Department of Real Estate was cited in the Council of Economic Advisors 2024 Economic Report of the President. Chapter 4 of the report, “Increasing the Supply of Affordable Housing: Economic Insights and Federal Policy Solutions” cites a book from Aldren and Colburn, 2022, entitled “Homelessness Is a Housing Problem: How Structural Factors Explain U.S. Patterns.” (Available here: https:// homelessnesshousingproblem.com/.) Read the report, and see the book from Aldren and Colburn for more information.
The dynamics of housing cost burden among renters in the United States
Colburn, G., Hess, C., Allen, R., & Crowder, K. (2024). The dynamics of housing cost burden among renters in the United States. Journal of Urban Affairs, 1–20. https://doi.org/10.1080/07352166.2023.2288587.
Abstract
Housing cost burden—defined as paying more than 30% of household income for housing—has become a central feature of the American stratification system with dire consequences for the health and well-being of adults and children living in burdened households. To date, existing research has largely focused on the overall prevalence and distribution of housing cost burden—that is, the percentage of households that are cost burdened at a given time and differences in exposure to housing cost burden based on race and income using cross-sectional sources of data. To more fully understand the dynamics of housing cost burden among renter households in the United States including the frequency and duration of spells, we use 50 years of longitudinal data from the Panel Study of Income Dynamics (PSID). The analysis reveals that, in contrast to the episodic nature of poverty, housing cost burden is deep, frequent, and persistent for a growing share of American households.
Keywords
Housing cost burden; rental housing; housing affordability; rent burden
Carrie Sturts Dossick featured on Freakonomics Radio episode
Associate Dean for Research and P.D. Koon Professor of Construction Management Carrie Sturts Dossick was interviewed and featured in a NPR Freakonomics Radio episode entitled “566. Why Is It So Hard (and Expensive) to Build Anything in America?” View the College of Built Environments LinkedIn post about this podcast feature. Episode description: “Most industries have become more productive over time. But not construction! We identify the causes — and possible solutions. (Can you say … “prefab”?) RESOURCES: “The Strange and…
Economic resilience during COVID-19: the case of food retail businesses in Seattle, Washington
Sun, F., Whittington, J., Ning, S., Proksch, G., Shen, Q., & Dermisi, S. (2023). Economic resilience during COVID-19: the case of food retail businesses in Seattle, Washington. Frontiers in Built Environment, 9. https://doi.org/10.3389/fbuil.2023.1212244
Abstract
The first year of COVID-19 tested the economic resilience of cities, calling into question the viability of density and the essential nature of certain types of services. This study examines built environment and socio-economic factors associated with the closure of customer-facing food businesses across urban areas of Seattle, Washington. The study covers 16 neighborhoods (44 census block groups), with two field audits of businesses included in cross-sectional studies conducted during the peak periods of the pandemic in 2020. Variables describing businesses and their built environments were selected and classified using regression tree methods, with relationships to business continuity estimated in a binomial regression model, using business type and neighborhood socio-demographic characteristics as controlled covariates. Results show that the economic impact of the pandemic was not evenly distributed across the built environment. Compared to grocery stores, the odds of a restaurant staying open during May and June were 24%, only improving 10% by the end of 2020. Density played a role in business closure, though this role differed over time. In May and June, food retail businesses were 82% less likely to remain open if located within a quarter-mile radius of the office-rich areas of the city, where pre-pandemic job density was greater than 95 per acre. In November and December, food retail businesses were 66% less likely to remain open if located in areas of residential density greater than 23.6 persons per acre. In contrast, median household income and percentage of non-Asian persons of color were positively and significantly associated with business continuity. Altogether, these findings provide more detailed and accurate profiles of food retail businesses and a more complete impression of the spatial heterogeneity of urban economic resilience during the pandemic, with implications for future urban planning and real estate development in the post-pandemic era.
Steven Bourassa quoted in Washington State Standard article on Rent Prices Stabilizing
Steven Bourassa is an H. Jon and Judith M. Runstad Endowed Professor and Chair in the Runstad Department of Real Estate, and is Director of the Washington Center for Real Estate Research. Professor Bourassa was quoted in a Washington State Standard story entitled “Rents in Washington show signs of stabilizing,” as an expert in the field. Read the article here.
Assessing Office Building Marketability before and after the Implementation of Energy Benchmarking and Disclosure Policies—Lessons Learned from Major U.S. Cities
Shang, L., Dermisi, S., Choe, Y., Lee, H. W., & Min, Y. (2023). Assessing Office Building Marketability before and after the Implementation of Energy Benchmarking and Disclosure Policies—Lessons Learned from Major U.S. Cities. Sustainability (Basel, Switzerland), 15(11), 8883–. https://doi.org/10.3390/su15118883
Abstract
An increasing number of U.S. cities require commercial/office properties to publicly disclose their energy performance due to the adoption of energy benchmarking and disclosure policies. This level of transparency provides an additional in-depth assessment of a building’s performance beyond a sustainability certification (e.g., Energy Star, LEED) and may lead less energy-efficient buildings to invest in energy retrofits, therefore improving their marketability. However, the research is scarce on assessing the impact of such policies on office building marketability. This study tries to fill this gap by investigating the impact of energy benchmarking policies on the performance of office buildings in four major U.S. cities (New York; Washington, D.C.; San Francisco; and Chicago). We use interrupted time series analysis (ITSA), while accounting for sustainability certification, public policy adoption, and property real estate performance. The results revealed that in some cities, energy-efficient buildings generally perform better than less energy-efficient buildings after the policy implementation, especially if they are Class A. The real estate performances of energy-efficient buildings also exhibited continuously increasing trends after the policy implementation. However, due to potentially confounding factors, further analysis is required to conclude the policy impacts on energy-efficient buildings are more positive than those on less energy-efficient buildings.
Keywords
building energy benchmarking and disclosure policies; building energy efficiency; office buildings; time series modeling
An Economic Analysis of Incorporating New Shared Mobility into Public Transportation Provision
Wang, Y., & Shen, Q. (2023). An economic analysis of incorporating new shared mobility into public transportation provision. Transport Policy, 141, 263–273. https://doi.org/10.1016/j.tranpol.2023.07.025
Abstract
Transit agencies in the US have shown great interests in the possibility of incorporating on-demand shared mobility modes into their fixed-route transit services. However, the cost-effectiveness of on-demand modes has not been clearly demonstrated, and there lacks an effective method for transit agencies to compare the costs of different service provision options. This study develops an economic-theory-based framework that appropriately conceptualizes the total economic cost of incorporating on-demand modes into transit. Based on the theoretical framework, a simulation model is built to operationalize an approach for evaluating the cost-effectiveness of transit-supplementing, on-demand mobility services. We demonstrate the applicability of this approach using Via to Transit program in the Seattle region. By accounting for both the service provider's cost and the users' cost, we obtain a more complete and accurate measure for the cost advantages of the on-demand modes in this case in comparison to expanding fixed-route transit, where the total economic cost for the on-demand mode is 22% lower than the fixed route transit. The theoretical framework and the simulation model can support the decision-making of public transit agencies as they explore incorporating mobility on demand to supplement traditional transit.
Keywords
Public transit; On-demand shared mobility; Marginal cost; Generalized travel cost; Transportation simulation
Mortgage Loan Costs: Magnitude and Drivers of Variation
Arthur Acolin & Rebecca J. Walter (2023). Mortgage Loan Costs: Magnitude and Drivers of Variation. Housing Policy Debate, DOI: 10.1080/10511482.2023.2236984
Abstract
This article uses national data disclosed as part of the Home Mortgage Disclosure Act (HMDA) to examine variations in loan costs based on type of loan, borrower, purpose (purchase, improvement, or refinance), and neighborhood characteristics. Loan costs are generally higher for nonconventional conforming loans with higher levels of credit risks (loans with higher combined loan-to-value, higher debt-to-income ratios, and for investment properties). This implies that product and borrower risk impact loan costs. However, borrower characteristics such as income and race/ethnicity are also associated with differences in loan costs even after controlling for loan characteristics, location, and lender fixed effects. Total loan costs are higher both in dollar terms and as a share of the loan amount for Black borrowers and Hispanic borrowers, and total loan costs represent a higher share of the loan amount for lower income borrowers. These disparities are larger in neighborhoods with higher levels of lender concentration and implicit racial bias. These findings suggest that in addition to access to mortgages and interest rates, loan costs can represent a barrier for access to homeownership with a disparate impact for Black and Hispanic borrowers, which contributes to perpetuate the homeownership gap.
Keywords
Mortgage loan costs; homeownership; borrowing constraints; homeownership gap
Keith Leung
Research Interests: Mortgage, risk, demographics, finance and investment