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The newspaper of The Johns Hopkins University December 19, 2005 | Vol. 35 No. 15
Looking for an Answer to Baltimore City Housing Riddle

City Councilman Jim Kraft takes notes during a presentation on Baltimore housing prices by first-year students in the master's in policy studies program.

By Glenn Small

How could it be possible that in the middle of an unprecedented housing boom in Baltimore City, a number of stable middle-class neighborhoods with favorable images were not taking part? Housing price increases for these neighborhoods were well below the roaring 19 percent increase for all city neighborhoods for the year 2003 to 2004.

To Sandra Newman, director of the Institute for Policy Studies and professor for the class Policy Analysis for the Real World, the riddle seemed an ideal problem with which to challenge her first-year master's in policy studies students.

So, posing as Mayor Martin O'Malley directing a research assignment to city Housing Commissioner Paul Graziano, Newman outlined the problem in a fictitious memo charging her 28 students to come up with in-depth analysis and recommendations. Last Tuesday in Homewood's Hodson Hall, they presented their research data and findings to an interested audience of more than 70 people who included Graziano, two members of the City Council and other prominent Baltimore residents keenly interested in the subject.

The students began by analyzing some commonly held theories about house price appreciation; for example, many believe that such things as strong homeownership, good schools and a lack of crime are factors that contribute to faster-rising home prices. They then proceeded to outline the mountain of research they sifted through in making their report. Researching five individual census tract neighborhoods with median incomes above the city average, stable and with good reputations, they found that these neighborhoods nonetheless had home sale prices that rose much less than in the city as a whole.

In their review, the students pored over decades' worth of census data and city records, and conducted 76 field interviews with residents, business owners, neighborhood activists and experts; they also read news accounts of these neighborhoods for the past five years in City Paper and The Baltimore Sun. In addition, the students went out into the neighborhoods to observe conditions and to build databases of information on such things as upkeep, cleanliness and public transportation.

What they found was somewhat surprising.

The things they thought would have an impact on the slower-rising home price neighborhoods actually didn't factor into the equation. By comparing their subject neighborhoods with adjacent neighborhoods that had faster-rising home prices, they discovered that the quality of schools (as measured by test scores), crime rates (reported property and violent crimes) and levels of homeownership didn't make a difference.

To get answers, they had to dig deeper into the specifics of each neighborhood. For the Waltherson neighborhood situated between Harford and Belair roads, the students discovered that all the neighborhoods oriented toward Belair Road had slower-rising home prices, while those oriented toward Harford Road had faster-rising ones.

The difference, they theorized, was that the Belair Road corridor had little community development corporation investment and little in the way of beautification projects, while Harford Road had a lot of community investment in the road and in projects to beautify it. This translated into a better perception of adjacent neighborhoods and higher home prices.

In several neighborhoods, race seemed to play a role. In the Frankford neighborhood in Northeast Baltimore, for example, they speculated that there was a correlation in home price increases and the percentage of white residents vs. African-American residents; the higher the percentage of white residents, the faster home prices were rising, during the time period studied.

"We think we have found a trend connecting race with home price appreciation," said Sarah Brown, one of the students.

In other neighborhoods, such as Morgan Park/Lauraville, the kind of housing within the neighborhood seemed to make a big difference in home price appreciation. In the blocks with attached brick homes, prices rose more slowly than in blocks with large Victorian homes, the students said.

In another neighborhood studied, Mayfield/Belair Edison, its proximity to parks led students to believe the parks would play a role in boosting home prices, but in the final analysis, they did not.

In their conclusions, the students theorized that quality of schools didn't have an impact on home price appreciation in certain neighborhoods because many Baltimore residents there send their children to private schools; likewise, the percentage of homeownership didn't have a big impact on home prices, as they had thought it would.

Sarah Brannen, one of the student researchers, concluded the presentation by noting that while many of the houses in these neighborhoods are not appreciating as fast as those in similar neighborhoods, that might not be all bad.

"Although the neighborhoods seemed to be, quote unquote, left behind," she said, "we felt they offer the very necessary option of affordable housing for the residents of Baltimore."

Graziano followed the presentation carefully and appeared to be taking copious notes.

"I compliment the students in the class for taking on this assignment," he said afterward. "It is a complex set of issues."

He noted that housing types (detached vs. attached) "clearly are a variable in the neighborhoods you selected," but in some of the hottest neighborhoods in Baltimore, prices aren't being held back by small attached homes. But Graziano said that is likely a function of location more than anything.

About the Frankford area studied, Graziano said he is hopeful that some changes there will yield some positive results in the coming years, but he noted that the neighborhood is sliced in half by power lines that have an impact on home prices, "and we can't move them."

Overall, Graziano said, "it's a very interesting, thought-provoking study. It probably raises as many questions as it answers, but that's probably the nature of these types of studies."

Two members of the City Council, Rochelle "Rikki" Spector (D-5th) and James B. Kraft (D-1st), were also on hand. Both seemed impressed by the student analysis and had thoughtful questions and comments. Kraft noted that the work underscores the continuing divide between rich and poor Baltimore, with rich Baltimore being predominantly white, and poor being predominantly African-American. "It's the two Baltimores," he said. "We certainly have a challenge to change that."


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