Explaining the Support for Homeownership Policy in US Cities: A Political Economy Perspective

Local officials in the US often extol the virtues of homeownership. Public proclamations about homeownership are frequent from these officials and echo many of the claims made by federal policy makers. While the federal government has promoted and funded policy to increase homeownership for decades, little is known about the level of financial support devoted to homeownership at the local level or the reasons for any variation in support among cities. This research examines the attitudes of city mayors about local policies and homeownership and investigates explanations for support of homeownership policy. In doing so, the research uses a public choice framework to explore the effects of inter-city competition and other factors on local housing policy making. Using data from surveys of city mayors and professional staff, as well as US Census data, this research finds that high levels of competition are associated with higher levels of support for homeownership. Furthermore, the results suggest that homeownership programs may be considered developmental policy in cities, not redistributive policy like most housing programs. The paper concludes with theoretical and policy implications based on the research results as well as identifying needs for future research on local homeownership policy.