If High Crime Lowers Housing Prices, Can Neighborhoods Be Safe And Affordable?

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Numerous studies show that the rise of crime correlates with lowered property values, and vice versa. Here’s how it works, and what it means for inhabitants.

Poverty creates crime; crime creates more poverty. The cycle goes on and on, generating low or high property values dependent upon neighborhood safety.

The logic makes sense, certainly, but at the same time offers no solution to maintaining housing that is both safe and affordable.

In New York City, a law was passed in 2013 requiring an NYC Crime map, for which the government worked with Google to map out all felonies by location to provide New Yorkers (and out-of-towners) transparency on where and when, exactly, crimes were committed.

While this development enhances understanding around locational crime frequency, it also raises speculation on the stigmatization of communities, and lowering their property values as result.

Studies on crime’s impact on property

The literature on this topic is both deep and expansive, as Harvard Shorenstein Journalistic Resource details.

One study found that among seven crimes studied, only robbery and aggravated assault meaningfully influenced property values, though another, which studied the impact of registered sex offenders on neighborhoods, found house prices fell by 2.3% when a sex offender moved nearby.

Studies found that in Los Angeles, high levels of vacancies and crimes inhibited sales; in Barcelona, houses in areas perceived to be less safe were highly discounted; in the UK, cases of antisocial behavior and violent crime lowered house value by 1% and 2% respectively; and studies found similar results in Sweden and Brazil.

Adversely, less crime has been shown to raise values: One study showed that a 10% decrease in homicides lead to a .83% increase in value in 8 U.S. cities; another showed that in Latin America, when homicides dropped between 10% and 25%, property selling prices rose from 5% to 10%.

Fighting crime and poverty


Photo courtesy of bixentro via Flickr.

Basically, based on research trends, lower crime raises property value, while increased crime – or even just perceived danger or proximity to an offender – can cause it to plummet.

Though anti-crime policies such as increased surveillance have been shown to decrease crime, it’s unclear whether it is actually reduced, or just displaced to less protected areas.

What you get as a result is poorer people enduring high crime and violence, a matter further complicated by gentrification, which often pushes them out once their area’s safety and value is brought up by wealthier inhabitants.

Even so, cities such as Boston, Philadelphia, Washington, and Pittsburgh, which have been increasingly attracting young professional newcomers, are planning initiatives that would reduce or freeze property taxes for longtime homeowners, the NY Times says, making it easier for them to stay in their gentrified area despite rising prices.

Though not without their controversy, such initiatives may allow for a better balance of safety and affordability, and while they don’t eliminate crime or poverty, may be an effective way to diffuse their locational focus.

Jennifer Markert