Moving from Public Housing to Homeownership: Perceived Barriers to Program Participation and Success.

August 2003

Anna M. Santiago and George C. Galster, Wayne State University.

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The goals of public housing have evolved from providing shelter to providing opportunities for escaping from welfare and buying one's own home. Despite numerous federal policies aimed at enhancing resident self-sufficiency and homeownership through programs run by local public housing authorities, little is known about who participates and who succeeds. This study explores barriers to participation and success in an innovative resident self-sufficiency /homeownership program developed by the Housing Authority of the City and County of Denver. We conduct a survey of participants in the Foundations for Homeownership program, eliciting their perceptions regarding willingness and ability to participate in the program and, thereafter, completing it successfully. We find that at time of entry into the program, participants report, on average, 4.6 major barriers that they perceive would limit their ability to achieve current goals. Poor credit ratings, not having enough savings, low earnings, carrying too much debt, and perceived discrimination against low income people by mortgage lenders were seen as the primary obstacles affecting participant ability to achieve their goals. When asked about the factors which affect public housing residents' ability to participate in homeownership programs, participants identified the following as major problems: lack of affordable day care; not knowing about available resources; lack of education or training; lack of confidence in the ability to succeed; substance abuse; and the unwillingness or inability to make the effort or commitment to reach personal goals. Major barriers affecting the willingness of public housing residents to participate in homeownership programs include carrying too much debt; not earning a high enough hourly wage; not having enough savings; the lack of a steady job; not being able to budget earnings effectively; and poor credit ratings. Respondents suggest that increasing earnings, repairing credit, perseverance, and learning how to budget are the major vehicles for overcoming these barriers. OLS and logistic regression analyses were conducted to ascertain the degree to which perceived barriers were associated with participants' demographic, economic, or attitudinal characteristics. Larger numbers of perceived barriers to achieving goals were associated with African American or Latino status. Relative to those living in conventional public housing developments, residents in Section 8 housing reported fewer perceived barriers. Higher levels of self-esteem were associated with fewer perceived barriers; higher levels of self-efficacy were associated with higher odds of participants expecting to be better off and attaining homeownership.
Keywords: homeownership, public housing, self efficacy, self esteem, barriers