Investments in this strategy aim to increase residential stability by strengthening the quality of housing, adding renter protections to reduce risk of eviction, and increasing access to resources like good schools, healthcare, grocery stores, and public transportation. The sections below include an overview of the strategy for achieving desired goals, supporting evidence, core metrics that help measure performance toward goals, and a curated list of resources to support collecting, reporting on, and using data for decision-making.

What

Dimensions of Impact: WHAT

Investors interested in deploying this strategy should consider the scale of the addressable problem, what positive outcomes might be, and how important the change would be to the people (or planet) experiencing it.

Key questions in this dimension include:

What is the problem the investment is trying to address? For the people experiencing the problem, how important is this change?

In many developed economies, lower income households move residences at vastly higher rates than their middle- and upper-income counterparts. Of course, not all moves are problematic; families may move into larger homes, onto nicer blocks, or just a small distance down the road to access better education, food, or healthcare. For those who are forced to leave their homes, however, residential instability can have deep and long-term negative effects. Investments in this theme can improve residential stability by:

  • increasing the quality of housing, access to services like good schools and health care, or access to resources like well-stocked grocery stores, thereby diminishing the reasons for which a family might choose to move (2, 3, 4);
  • increasing access to public transportation, thereby helping beneficiaries to find and retain steady, consistent work (2);
  • improving renter protections or rental pricing to reduce the risk of eviction, which can compound childhood development problems and health, educational, and emotional instability (2); and -through a combination of improved housing quality, increased access to services, and other factors, this strategy contributes to stronger family and community heath, improved educational and employment outcomes, reduced rates of homelessness, and an improved local economy. 

What is the scale of the problem?

Taking 30% of income as a standard for housing affordability, the number of cost-burdened U.S. households overall has been estimated at around 39 million (5). This number includes about 48% of renters. Poorer children, in particular, are almost twice as likely to experience acute residential instability, on average moving six times more often than their wealthier counterparts before adulthood. Residential instability most likely impacts those individuals living below or near the poverty line in a given area (3). Financial instability is the most common cause of moves, and a lack of savings or disposable income often makes moves all the more challenging for a household.

Who

Dimensions of Impact: WHO

Investors interested in deploying this strategy should consider whom they want to target, as almost every strategy has a host of potential beneficiaries. While some investors may target women of color living in a particular rural area, others may set targets more broadly, e.g., women. Investors interested in targeting particular populations should focus on strategies that have been shown to benefit those populations.

Key questions in this dimension include:

Who/What is helped through this strategy?

While this strategy has many potential beneficiaries, with the specific intended beneficiaries varying by investor preference, unstable housing conditions in many developed markets primarily affect the following individuals, who are therefore more frequently targeted:

Children: Frequent moves can disproportionately affect children due to the associated requirement to shift schools and the emotional and physical stress associated with developing new routines and patterns (1, 2). Children who face housing instability at critical times in their development often experience harmful physical and mental health outcomes later in life.

Very Low-Income Individuals: While members of all socioeconomic strata face negative consequences from residential instability, those living below the poverty line are both more susceptible to residential instability and less prepared, because of their lower levels of wealth and savings, to use capital to buffer the negative impacts of a move on themselves and their families (2).

What are the geographic attributes of those who benefit?

Housing instability is most prevalent in areas with high concentrations of low-income individuals or where median income is low and cost of living is high. Often, moving frequencies are higher in urban areas because cities have sufficient housing stock to accommodate moves. The negative impacts of housing instability are also often felt most acutely in urban areas, where moves of even relatively minimal distance can lead to significant changes in residents’ lives (e.g., a new school system or neighborhood).

Contribution

Dimensions of Impact: CONTRIBUTION

Investors considering investing in a company or portfolio aligned with this strategy should consider whether the effect they want to have compares to what is likely to happen anyway. Is the investment's contribution ‘likely better’ or ‘likely worse’ than what is likely to occur anyway across What, How much and Who?

Key questions in this dimension include:

Is the investment’s contribution ‘likely better’ or ‘likely worse’ than what is likely to occur anyway across What, How Much and Who?

The extent to which this strategy can address residential instability depends on the particular affordable housing project and the nature of the housing brought to market. Housing accessibility requires units that are physically, financially, and intellectually accessible to their intended beneficiaries. Housing resulting from investments that work to mitigate the challenges that beneficiaries face related to residential instability—by considering household finances, protecting tenants from undue eviction, offering access to necessary services, and providing higher-quality housing—will likely be better for beneficiaries than housing options that are already available.

How Much

Dimensions of Impact: HOW MUCH

Investors deploying capital into investments aligned with this strategy should think about how significant the investment's effect might be. What is likely to be the change's breadth, depth, and duration?

Key questions in this dimension include:

How many can receive the outcome through this strategy?

All developed economy countries struggle to some extent with this issue, though to varying degrees. For example, half of all U.S. households below the poverty line moved at least once between 2005-2010, and the number of cost-burdened households there has been estimated around 39 million (2,5). Investors seeking to reduce residential instability as a means of delivering impact may consider investing in affordable housing units that target families or individuals with less than 30% of area median income (AMI). Overall, the number of potential beneficiaries of this investment strategy is limited only by the number of individuals living without housing stability in a particular region (2).

How much change can beneficiaries experience through this strategy?

The amount of change beneficiaries experience greatly depends on the housing product, as well as any services or additional support offered. Examples of change aligned with this strategy include:

  • An industry report found that New York City families living in affordable homes financed by Low Income Housing Tax Credits had double the discretionary income of their neighbors in high-cost housing, enabling them to buy health insurance, pay down debt, save to pay for education, or buy a home (6).
  • Compared to children of similar, housing-waitlisted families, a study found that a child living in subsidized housing had a 35% greater chance of being classifed as a “well” child, 28% lower risk of serious underweight, and 19% lower risk of food insecurity (7).
  • Access to housing court mediation/legal services in Hennepin County, Minnesota led to settlement without eviction and families retaining housing in 69% of cases raised against families in housing court (3). 

Illustrative Investment

CommonBond Communities is the Midwest’s largest affordable housing provider, uniquely focused on providing resident services concentrated on youth achievement (8). Along with the Bishop’s Creek Community Development Corporation, CommonBond preserved Glenbrook Apartments in a high-priority revitalization area in Milwaukee, Wisconsin, rehabilitating 72 units with new appliances, central air units, and energy-efficient windows. These apartments were targeted for preservation because of their close proximity to schools, day care, and bus lines. As part of the renovation, CommonBond built an Advantage Center that provides academic programs ranging from after-school tutoring for youth to continuing education classes for adults. Youth who participate in CommonBond’s onsite academic and social programs graduate from high school at higher rates, CommonBond has shown, than the general population. In addition to providing supportive services, such as educational support and healthcare, CommonBond strives to retain tenants for extended periods of time before transitioning them to other, sustainable and stable sources of housing depending on each family’s needs and income. 

Draw on Evidence

This mapped evidence shows what outcomes and impacts this strategy can have, based on academic and field research.

NESTA: 2
Housing Instability and Food Insecurity as Barriers to Health Care Among Low-Income Americans

Margot B. Kushel, Reena Gupta, Lauren Gee, and Jennifer S. Haas. “Housing Instability and Food Insecurity as Barriers to Health Care Among Low-Income Americans.“ Journal of General Internal Medicine 21, no. 1 (2006): 71-77.

NESTA: 1
Poverty, Residential Mobility, and Student Transiency within a Rural New York School District

Kai A. Schafft. “Poverty, Residential Mobility, and Student Transiency within a Rural New York School District.“ Rural Sociology71, no. 2 (2006): 212-231.

NESTA: 2
Residential Mobility Among the Rural Poor

Janet M. Fitchen. “Residential Mobility Among the Rural Poor.“ Rural Sociology 59, no. 3 (1994): 416-436.

NESTA: 3
School Mobility and Student Achievement in an Urban Setting

Lisa Melman Heinlein, and Marybeth Shinn. “School Mobility and Student Achievement in an Urban Setting.“ Psychology in the Schools 37, no. 4 (2000): 349-357.

NESTA: 2
Evidence Matters: How Housing Mobility Affects Education Outcomes for Low- Income Children

Rachelle Levitt. “Evidence Matters: Transforming Knowledge into Housing and Community Development Policy Fall 2014.” (2014).

NESTA: 2
Residential Stability and the Social Impact of Neighborhood Disadvantage: A Study of Gender- and Race-Contingent Effects

Scott Schieman. “Residential Stability and the Social Impact of Neighborhood Disadvantage: A Study of Gender- and Race-Contingent Effects.“ Social Forces 83, no. 3 (2005): 1031-1064.

NESTA: 2
Neighborhood Disadvantage, Residential Stability, and Perceptions of Instrumental Support Among New Mothers

Kristin Turney, and Kristen Harknett. “Neighborhood Disadvantage, Residential Stability, and Perceptions of Instrumental Support Among New Mothers.“ Journal of Family Issues 31, no. 4 (2010): 499-524.

NESTA: 1
Beyond Quality: Parental and Residential Stability and Children’s Adjustment

Emma K. Adam. “Beyond Quality: Parental and Residential Stability and Children’s Adjustment.“ Current Directions in Psychological Science 13, no. 5 (2004): 210-213.

NESTA: 1
The State of the Nation's Housing 2017

Joint Center for Housing Studies of Harvard University. “State of the Nation’s Housing 2017.” 2017. http://www.jchs.harvard.edu/research/state_nations_housing

NESTA: 2
Early Childhood Residential Instability and School Readiness: Evidence from the Fragile Families and Child Wellbeing Study

Kathleen M. Ziol-Guest and Claire McKenna. “Early Childhood Residential Instability and School Readiness: Evidence from the Fragile Families and Child Wellbeing Study.“ Center for Research on Child Wellbeing Working Paper 2009-21-FF(2009).

NESTA: 2
Forced Relocation and Residential Instability among Urban Renters

Matthew Desmond, Carl Gershenson, and Barbara Kiviat. “Forced Relocation and Residential Instability among Urban Renters.“ Social Service Review 89, no. 2 (2015): 227-262.

Each resource is assigned a rating of rigor according to the NESTA Standards of Evidence.

Define Metrics

Core Metrics

This starter set of core metrics — chosen from the IRIS catalog with the input of impact investors who work in this area — indicate performance toward objectives within this strategy. They can help with setting targets, tracking performance, and managing toward success.

Additional Metrics

While the above core metrics provide a starter set of measurements that can show outcomes of a portfolio targeted toward this goal, the additional metrics below — or others from the IRIS catalog — can provide more nuance and depth to understanding your impact.