2022 Theses Master's

Hidden Alpha - A Path Towards More Rental Assistance Housing

Collins, Leila

The United States is facing a dire affordable housing crisis. Without a viable path to maintain existing and build new public housing, private investment into Section 8 housing is the fastest path to preserve and create subsidized units. My research engages in qualitative and quantitative analysis of the risk and returns for investors in Section 8. I conclude that there are likely high returns that are not adjusted for risk. The investors are therefore taking outsized returns of a government backed asset. I propose various market and policy solutions to stimulate competition to right size the returns in relation to the risk to increase the total number of units preserved per government dollar invested.