Social housing in the USA and France: Lessons from convergences and divergences
Download Document| Date Published | |
| Version | |
| Primary Author | Ira Peppercorn |
| Other Authors | Claude Taffin |
| Theme | Rental Housing |
| Country |
Abstract
The development of subsidized rental housing estates really begun in the USA after the Great Depression and in France after World War II, but has changed dramatically since that time, relying more heavily on tools that can be used by the private sector. This comparison will show that the relevant solution to housing problems in a given context should be based on the correct diagnosis of this problem and also be dependent upon the specific situation in that country, state or locality. This is the best way to create efficient, sustainable, affordable financing mechanisms for local, municipal and state governments. This paper will discuss the different methods by which the United States and France have addressed the challenges. For the U.S., we will highlight two programs: the low income housing tax credit program, which uses the tax code as an incentive, and the capital fund financing program, that allows public housing authorities to securitize an ongoing stream of funds and use this to modernize properties. France introduced tax subsidies to the private sector at the same period, but in addition, not as a substitute, to public housing. After heavy taxes had deterred private investors, generous tax incentives brought them back towards rental housing. Few of these programs were affordable to moderate income households. This resulted, in the recent years, in an aftermath of production of public housing units, requiring an increasing commitment from the municipalities.