States News Service (CFED)
By: States News Service
December 19, 2013
The following information was released by the Ohio Housing Finance Agency (OHFA):
A study funded by the Ohio Housing Finance Agency (OHFA) examined Cornerstone Corporation for Shared Equity's unique property management system that incentivizes renters to fulfill their rental commitments while building financial assets, engaging in community improvement, and maintaining their place of residence in Cincinnati, Ohio.
The Corporation for Enterprise Development (CFED), in partnership with the Economics Center at the University of Cincinnati, evaluated Cornerstone's Renter Equity property management system to determine its effects on residents, the surrounding neighborhood, and property management costs.
"Homeownership can serve as a great wealth-building vehicle for low-income Americans and leads to household financial stability and increases investment in and commitment to a community," said Anita Drever, CFED's director of applied research. "Our goal with this evaluation was to see if renters can also achieve the same benefits with Cornerstone's innovative approach."
Created in 2000 and implemented in three affordable housing communities located in the Over- the-Rhine neighborhood, the innovative Renter Equity system offers financial incentives to residents who fulfill the obligations in their lease by making timely rent payments, participating in the resident community, and helping to maintain the properties. In reciprocation of reduced resident turnover and decreased maintenance-related issues and expenses for property managers, participating residents earn Renter Equity credits which vest after five years. In addition, residents who fulfill their commitments can borrow against earned credits to cover a financial emergency.
"Cornerstone is honored that OHFA selected Renter Equity for its Housing Innovation Fund study. Our unique system has entered its second decade and we are excited about the progress we have made to date and the results of this evaluation," said Rob Sheil, Cornerstone's executive director. "We look forward to enabling others in Ohio to implement this system and transform neighborhoods through the resident empowerment and community engagement that Renter Equity delivers." The study of the management system involved an in-depth, mixed-method research approach including stakeholder interviews, a phone survey with Cornerstone residents, and an analysis of the equity and loan program participation data.
"We not only discovered that the Renter Equity program contributes substantially to the financial well-being of residents, but also that the Cornerstone model contributes to a strong sense of community that emanates into the surrounding environment," said Stuart Wilson, research associate at the University of Cincinnati Economics Center.
Based on the research conducted, the evaluation found that on average, residents participating in the management system stay in the properties five or more years and accumulate more than $2,000 in renter equity credits. In addition, the positive physical and financial benefits for the residents, increased community engagement, and well-maintained properties were viewed as beneficial to the surrounding neighborhoods. Participating residents expressed an appreciation for the opportunity to live in attractive and safe properties, the responsiveness of property management, and having a voice in the decision-making processes affecting the resident community.
"The property management system implemented by Cornerstone is an impressive example of the innovative affordable housing communities OHFA is proud to partner with," said OHFA's executive director Doug Garver. "The evaluation of the Renter Equity system's impact on its residents, properties and nearby communities is highly impressive and could greatly influence future affordable housing policies within the state."