2004. “The Impact of Capital on Crime: Does Access to Home Mortgage Money Reduce Crime Rates?” Paper presented at the Annual Meeting of the Urban Affairs Association (original) (raw)

Neighborhood Housing Investments and Violent Crime in Seattle, 1981–2007*

Despite significant advances in the study of neighborhoods and crime, criminologists have paid surprisingly less attention to the extralocal forces that shape violence. To address this issue, we draw on an emerging body of work that stresses the role of home mortgage lending-a resource secured via interaction with external actors-in reducing neighborhood violence and extend it by addressing concerns that the lendingviolence relationship is spurious and confounded by simultaneity. We explore the longitudinal relationship between residential mortgage lending and violence in Seattle with a pooled time series of 118 census tracts over 27 years, and we instrument our endogenous predictors (home mortgage lending and violent crime) with changes in their levels from prior periods. Employing Arellano-Bond difference models, we assess both the effect of mortgage lending on violent crime as well as the effect of violent crime levels on mortgage activity. We find that infusions of home mortgage lending yield reductions in subsequent violent crime;

The Impact of Single-family Mortgage Foreclosures on Neighborhood Crime

Housing Studies, 2006

Foreclosures of single-family mortgages have increased dramatically in many parts of the US in recent years. Much of this has been tied to the rise of higher-risk subprime mortgage lending. Debates concerning mortgage regulation, as well as around other residential finance policies and practices, hinge critically on the social as well as personal costs of loan default and foreclosure. This paper examines the impact of foreclosures of single-family mortgages on levels of violent and property crime at the neighborhood level. Using data on foreclosures, neighborhood characteristics, and crime, the study found that higher foreclosure levels do contribute to higher levels of violent crime. The results for property crime are not statistically significant. A standard deviation increase in the foreclosure rate (about 2.8 foreclosures for every 100 owner-occupied properties in one year) corresponds to an increase in neighborhood violent crime of approximately 6.7 per cent. The policy implications of these findings are discussed.

Reevaluating Foreclosure Effects on Crime During the “Great Recession”

High rates of foreclosures during the "Great Recession" raised concerns about the potential harmful effects of the housing crisis not just on the economy, but also on levels of crime. Grounded primarily in theories of social disorganization and incivility, a growing body of empirical research has been directed at exploring whether the foreclosure crisis stimulated higher crime rates in America than would otherwise have been experienced. Many studies have now reported a significant association between rates of foreclosure and crime during the recession, but we are skeptical of whether this represents a causal effect because it is unclear whether the traditional regression approaches applied in most of the extent research account sufficiently for preexisting differences present in areas that experienced varying levels of foreclosure. We advance the literature on foreclosure and crime by employing a propensity score matching (PSM) technique to better account for such differences, evaluating whether U.S. counties that received larger "doses" of foreclosure during the recent recession experienced higher levels of property crime than comparable counties in which rates of foreclosure remained relatively low. Our analysis shows that, once prerecession differences between counties with high versus medium-to-low foreclosure rates are removed, there is no evidence of a significant association between rates of foreclosure and crime.

Banking Options and Neighborhood Crime: Does Fringe Banking Increase Neighborhood Crime

In the past few years, scholars interested in neighborhoods and crime have turned their attention to the role of neighborhood organizations. Recently, (Kubrin, Squires, Graves, and Ousey, Criminology & Public Policy, 10(2), 437-466, 2011) examined the impact of payday lenders on neighborhood crime. They found that there is a significant relationship between payday lenders, and both violent and property crime rates. The current research builds upon their work by exploring banking options in the city of Norfolk, Virginia. Findings indicate that the presence of payday lenders is significantly related to property crime in 2010 and violent crime in 2010, though the findings for violent crimes are not robust. Also there is a mild suppression effect predicting violent crime rates once socioeconomic deprivation is controlled. Pawn shops are not significantly related to either property or violent crimes. Interestingly banks are significant positive predictors of both property and violent crimes. The difference between the findings here and those of (Kubrin, Squires, Graves, and Ousey, Criminology & Public Policy, 10(2), 437-466, 2011) are discussed.

Home Foreclosures and Community Crime: Causal or Spurious Association?

Social Science Quarterly, 2012

Objective. Aggregate crime rates continue to decline in the United States despite the depth and breadth of the current foreclosure crisis. This trend calls into question conventional wisdom and prior research that suggest a causal, positive relationship be- tween foreclosures and crime. The objective of this article is to consider an alternative argument, that foreclosures and crime are part-and-parcel of the same community- level dynamics, and thus are not causally related. Methods. We use random effects models to analyze community crime and foreclosure data from Chicago between 2004 and 2009. Results. Findings reveal that crime and foreclosures are spuriously related; controlling for confounding factors such as concentrated disadvantage and the politi- cal hierarchy of communities renders the foreclosure-crime association nonsignificant. Conclusion. Foreclosures and crime are each explained by antecedent community characteristics. To understand why social problems are unevenly distributed across geographic space, it is necessary to investigate why power and political influence are unevenly distributed.

The contemporary foreclosure crisis and US crime rates

Social Science Research, 2012

Foreclosure rates in America reached unprecedented levels during the last half of the 2000s, and many observers have speculated that elevated crime rates were one of the probable negative collateral consequences of this trend. We examine this issue with a comprehensive county-level analysis of the role of foreclosure in shaping contemporary crime patterns, highlighting the possibility of theoretically informed non-linear and conditional relationships. Multivariate regression models that account for the well-documented spatial autocorrelation of crime rates and the possible endogeneity of foreclosure reveal a positive association between rates of foreclosure and property crime that accelerates significantly once foreclosure rates attain historically high levels. Multiplicative models indicate that this pattern holds for burglary across diverse county conditions, but the observed nonlinear effect of foreclosure on robbery rates is limited primarily to areas that also exhibit relatively high levels of resource deprivation and limited new housing construction.

Foreclosures and crime: A city-level analysis in Southern California of a dynamic process

Although a growing body of research has examined and found a positive relationship between neighborhood crime and home foreclosures, some research suggests this relationship may not hold in all cities. This study uses city-level data to assess the relationship between foreclosures and crime by estimating longitudinal models with lags for monthly foreclosure and crime data in 128 cities from 1996 to 2011 in Southern California. We test whether these effects are stronger in cities with a combination of high economic inequality and high economic segregation; and whether they are stronger in cities with high racial/ ethnic heterogeneity and high racial segregation. One month, and cumulative three month, six month, and 12-month lags of foreclosures are found to increase city level crime for all crimes except motor vehicle theft. The effect of foreclosures on these crime types is stronger in cities with simultaneously high levels of inequality but low levels of economic segregation. The effect of foreclosures on aggravated assault, robbery, and burglary is stronger in cities with simultaneously high levels of racial heterogeneity and low levels of racial segregation. On the other hand, foreclosures had a stronger effect on larceny and motor vehicle theft when they occurred in a city with simultaneously high levels of racial heterogeneity and high levels of racial segregation. There is evidence that the foreclo-sure crisis had large scale impacts on cities, leading to higher crime rates in cities hit harder by foreclosures. Nonetheless, the economic and racial characteristics of the city altered this effect.

Banks and the Racial Patterning of Homicide: A Study of Chicago Neighborhoods

International Journal of Conflict and Violence, 2009

While bank investment is a driving force behind neighborhood viability, few studies have directly examined the effects of bank loan practices on neighborhood crime rates. This paper proposes that variation in residential bank loans helps explain the higher rates of homicide in minority neighborhoods in Chicago compared to white neighborhoods. It finds that black and Latino neighborhoods would experience fewer homicides if more financial capital were infused into these neighborhoods. These findings suggest that neighborhoods are shaped profoundly by the decisions of external economic actors.

A Longitudinal Assessment of the Impact of Foreclosure on Neighborhood Crime

Objectives: To examine possible effects of housing foreclosure on neighbor- hood levels of crime and to assess temporal lags in the impact of foreclosure on neighborhood levels of crime. Methods: Longitudinal data from Glendale, Arizona, a city at the epicenter of the nation’s foreclosure problem. The authors rely on four data sources: (1) foreclosure data, (2) computer- aided dispatch (CAD)/police records management system (RMS) data, (3) U.S. census and census estimate data, and (4) land use data. Results: Foreclo- sure has a short-term impact, typically no more than 3 months, on total crime, property crime, and violent crime, and no more than 4 months for drug crime. Conclusions: Foreclosures do not have a long-term effect on crime in general, and have different, though modest effects on different types of crime. The relationship between foreclosure and crime is not linear in nature but rather is characterized by a temporal, short-term flux in crime.