Sandra Newman
Scott Holupka
Johns Hopkins University

This article uses the 2011 American Housing Survey to develop three indices of housing quality, test their validity, apply them to both the assisted and unassisted stock, and assess whether the Fair Market Rent (FMR) aligns with good assisted housing quality. The market value index, developed using hedonic regression, performs poorly and is dropped from further consideration. The consumer rating index, based on an ordered logistic regression of the respondent house rating on a 1-to-10 scale, and the normative standards index, based on a factor analysis, perform well, are highly correlated, and achieve convergent and predictive validity. Both of these indices indicate that the quality of assisted housing is comparable to that of unassisted housing. The analysis also supports the 40th percentile of rents definition of the FMR, which is roughly the inflection point for maximizing assisted housing quality on both housing quality indices tested. The findings demonstrate that the current inspection and quality control systems appear to be achieving the goal of providing physically adequate housing to assisted housing residents.