The voice of consumers is missing in judging subsidized housing

apartment ratings web site

Apartmentratings.com review of TDHCA funded LIHTC apartments

Low income tenants are seldom consulted about the quality of housing that the government builds for them.

I have long thought this to be a serious flaw in affordable housing. Without the active involvement of consumers how can we expect the housing to be designed to meet their needs?  Without asking the tenants, how can we evaluate whether the apartments are well managed and maintained?

Affordable housing is not a competitive market commodity like market rate housing. Low income families have few choices as to where to live.  The government and developers of affordable housing work together to provide a limited supply that will, by virtue of its scarcity, be guaranteed to be in great demand by low income renters.  There are at least six needy low income families for every subsidized rental housing unit in Texas.  So, all sorts of less that great housing can and is created as affordable housing and ends up being fully occupied.  So how are we to differentiate in subsidizing good from bad affordable housing without talking to the tenants?

The recent popularity and growth of apartment rating web sites promises one opportunity for a consumer voice in affordable housing developments.  I recently reviewed two of the most popular sites: apartmentratings.com and apartmentreviews.net.

Both fall short in being a consistently accurate and useful consumer rating tool.

I wanted to see if I could use the consumer ratings on these web sites to draw conclusions about the quality of apartments funded by the Texas Department of Housing and Community Affairs (TDHCA) under the Low Income Housing Tax Credit (LIHTC) program.  I specifically wanted to see if I could determine whether the subsidized housing units rated better or worse than private non-subsidized apartments.

Both sites report the number of ratings that have been written by tenants and former tenants and the percentage that rate an apartment development favorably.  But when I checked the listings for LIHTC funded apartments in San Antonio and Austin I discovered only about 20 percent of them had been rated by tenants.  Further, of those that were listed, a number had only a single tenant rating.  This is problematic because of bias introduced the anonymous and by the highly idiosyncratic nature of the ratings.

[ASIDE: One property that managed to attract several ratings was the Wurtzbach Manor Apartments (rating page pictured above).  It stands out as fairly unique in the number and degree of negative ratings it received.  Only one of seven ratings was favorable. Now before the NIMBYs who are reading this try to use it as evidence of inherent problems in LIHTC developments note that a comparison of the handful of LIHTC apartments with meaningful ratings with private funded apartment developments in Austin and San Antonio suggests that the LIHTC units are generally rated better that private apartments.  The problem, as I noted earlier, is that very few have ratings.]

Setting aside the Wurtzbach Manor case, you have to wonder if some of the posts that are most negative were not written by tenants who have an ax to grind with management over an issue that they are not disclosing or whether the postings are made by competing leasing agents hoping to steer would be tenants away from their competitors.  Likewise, some of the glowing reviews are almost surely written by the management staff of apartments posing as tenants.  So you really need several reviews written over an extended period to get a sense about the real situation in the development. Very few apartments have that depth of reviews.

So these on-line consumer reviews are of little use at this point in figuring out the difference between a good and a bad development from a consumer’s perspective.  But these services are new and may evolve into something useful in the future. It would behoove government agency compliance monitors to read the reviews to identify individual cases where bad management practices may be occurring however.

For now I am left hoping that smart government housing agencies may someday implement a good tenant survey system to gain insights into what works and what does not work for the clients of subsidized affordable housing developments. Basing compliance evaluations of affordable housing developments on narrow record keeping and financial standards misses the critical factor – whether the housing development is enhancing the lives of the families who call it home.