Rehabilitation Data Needs: A Building Industry Forum

Americans spend approximately $180 billion a year to rehabilitate and maintain the nation's $10 trillion housing stock. Only limited information, however, currently exists about how, where, and why these funds are used. For example, the government's two principal sources of information on home improvement spending - the Department of Commerce's quarterly survey of spending on residential alterations and repairs and HUD's American Housing Survey (AHS) - result in very different estimates on the amount of spending activity. Neither data source adequately meets the needs of policymakers, academic researchers, or industry planners to understand home improvement activities.

To gather input on this very important issue, HUD held a forum in November 2001 to discuss current sources of housing rehabilitation data, areas where additional data should be collected, and strategies for how to collect this data. A new report from HUD's Office of Policy Development and Research, "Rehabilitation Data Needs: A Building Industry Forum," contains the text of panelists' presentations and summarizes participant comments. Over 40 representatives from governmental, industry, and research organizations attended four moderated presentations on substantive areas relating to additional data and strategies for improving housing rehabilitation data and increasing its availability. The sessions focused mainly on the following areas:

• Geographical dimensions of remodeling.
  
• Rental housing.
  
• Rehabilitation finance.
  
• Government rehabilitation programs.

Expansion of Current Survey Data Sources

Surveys are the primary method of obtaining information about home improvements. Each panel paid particular attention to ways existing surveys could be expanded to collect additional relevant information. Due to the design of the national and metropolitan AHS surveys which collect data about individual housing units, it is impossible to study trends within any one community. In addition, the AHS restricts rehabilitation questions only to homeowners. Several other surveys ask similar questions of renters, but respondents tend to have little or no information about the costs, financing, or extent of home improvements completed. The Property Owners and Managers Survey, a one-time supplement to the AHS in 1995, collected information on capital improvements to rental properties, but not level of spending. Because the AHS is the primary government source of data about housing conditions, forum participants frequently mentioned adding more questions to the AHS as a way to gather more complete data about housing rehabilitation. Participants also suggested integrating and adding more comprehensive questions to other public and private surveys, including:

• American Community Survey.
  
• National Association of Homebuilders' Consumer Practices Survey.
  
• Consumer Expenditure Survey.
  
• Residential Finance Survey.
  
• Survey of Consumer Finance.

Records, Databases, and Other Sources of Rehabilitation Data

While survey data is generally the best way to understand why people decide to make home improvements, many other sources of public and private data that may shed some light on these issues are considered underutilized or inaccessible to the public. Both the public and private sectors would greatly benefit from the wider use of these sources.

• County and municipal governments throughout the United States maintain extensive data on existing houses for purposes of tax assessment. This data includes purchase price, value, housing characteristics, location, size, and other general information that would be helpful in an analysis addressing housing rehabilitation issues. Cities also require and maintain records of building permits for many structural changes that would also be of use in such studies. Difficulties, however, may arise when users try to compile these various datasets on a regional or national level because the permit requirements for home modification and the data collected in each jurisdiction may vary.
  
• Low Income Housing Tax Credit (LIHTC) and Historic Rehabilitation Tax Credit (HRTC) are major sources of funding for affordable housing and historic rehabilitation activities, respectively. A HUD database of LIHTC projects compiled from State Housing Finance Agency data in 1996 and updated in 1999 includes information about project size, location, construction type, and limited financial figures. The National Park Service maintains data about HRTC projects, half of which have targeted housing. Generating common fields for these databases and making the HRTC dataset more available to the public would greatly increase knowledge about rehabilitation done under these programs.
  
• Associations that represent the housing, construction, or building materials industries often conduct studies to help track industry progress or product market share, or collect data as part of their on-going operations. The Home Improvement Research Institute, for example, conducts the Product Purchase Tracking Survey, which asks 2,600 owner-occupied households about their remodeling expenditures. Currently, this data is available at no cost to association members at the time the collection process is completed and to the public for purchase several months later.

Strategies for Improvement

As metropolitan areas increasingly expand and the housing stock continues to age, the rehabilitation of older homes becomes a key method for providing housing opportunities in major urban areas. To be effective, this strategy requires a partnership between the nation's remodeling industry and Federal, state, and local policymakers; nonprofits; and other associations with a shared base of information for this sector of the housing stock. In an effort to begin the process of better data collection about home improvements, the forum and this report are important steps toward assembling the information required to develop such a strategy.