Building Renter Wealth: An Evaluation of Shared Prosperity Rental (SPR) Housing Program Design and Feasibility
Homeownership is an expensive, risky investment, but also a major source of wealth and security for many households. Renting offers flexibility and financial accessibility, but lacks the wealth-building opportunities of ownership. Are other models possible? To help answer this question, we evaluated the feasibility of "shared prosperity rental housing” (SPR), an innovative housing model seeking to combine benefits of homeownership and renting while mitigating their drawbacks. With support from MapCraft, Inc., this project evaluates the financial feasibility and tenant benefits associated with different models, identifies major barriers to adoption, and suggests policy reforms and financial instruments that could help it succeed.
We find that SPR housing could be viable in several California markets if backed by low interest, high leverage loans and a supportive regulatory environment, potentially attracting the privately funded developers and investors needed for rapid program expansion. Most importantly, we find that tenants could build substantial wealth without facing the same risks or barriers to entry as homeowners.
Read full report below or read Executive Summary (18 pages) here.
