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Home Equity Protection Project Home Equity Protection (HEP) is an innovative product that makes it safer for people to invest in a home. It guarantees homeowners that if the housing market declines in the area where they live, they will be protected for part or all of that loss. By providing this protection, HEP also helps to attract and retain homeowners in neighborhoods where there is a concern that property values might go down. HEP was made available in Syracuse on July 30, 2002, through Home Headquarters, Inc., a NeighborWorks® organization, in partnership with the Syracuse Neighborhood Initiative, the Neighborhood Reinvestment Corporation, the Yale School of Management, Freddie Mac, Real Liquidity, LLC, HSBC, the Mortgage Risk Assessment Corporation, and a number of local partners. It has already demonstrated its appeal to homeowners with nearly 60 customers and $4 million of home value protected in its first year of operation. HEP has also received substantial attention in the local and national media, with coverage on NPR's "Marketplace" in Forbes magazine, and in The Economist. How HEP helps homeowners and neighborhoods HEP would help families to protect their assets Home equity is one of the largest components of household wealth in the United States and yet there is virtually no way for the average family to insure itself against drops in home value and the ensuing loss to the owner's equity. Much of U.S. housing policy in the past decade has focused on expanding home ownership opportunities to low and moderate income Americans, but relatively little has focused on helping protect them against the financial risk that home ownership entails. Given the recent public policy emphasis on assisting low and moderate-income families to build wealth, lack of equity protection is a significant public policy gap. HEP helps to revitalize neighborhoods A home equity protection product will help to insulate local communities from eroding tax revenues and to build confidence in the potential for home ownership in urban neighborhoods which otherwise might be regarded as a risky bet for a homeowner's life savings. When choosing a neighborhood, homebuyers evaluate the cost of buying there, the amenities and quality of life offered by their prospective home and neighborhood, and the likelihood that they will make (or at least not lose) money when they go to resell their home. While there are many community development strategies that address the purchase price, amenities, and quality of life of a neighborhood, HEP is the only strategy that directly addresses investment concerns. Home Equity Insurance - A Pilot Project The following paper provides the structure of the pilot program in detail: Participating scholars at Yale include:
Selected Publications and Working Papers by HEP Program Participants: Collateral
Damage: Refinancing Constraints and Regional Recessions The Behavior of Home Buyers in Boom and Post-Boom Markets Forecasting Prices and Excess Returns in the Housing Market The Efficiency of the Market for Single Family Homes Prices of Single-Family Homes Since 1970: New Indexes for Four Cities Comparing
Wealth Effects: The Stock Market Versus the Housing Market Mortgage
Default Risk and Real Estate Prices: The Use of Index-Based Futures and Options
in Real Estate Home
Equity Insurance: A Pilot Project A
Spatial Model of Housing Returns and Neighborhood Substitutability Suburbs
and Cities Clustering
Methods for Real Estate Portfolios Moral Hazard and Home Equity Conversion Evaluating
Real Estate Valuation Systems Home
Equity Insurance Housing
Return And Construction Cycles Data Resources for ICF Fellows Karl Case and Robert Shiller have collected data sets on prices of houses.
The dataset provides a sample of homes that sold twice between 1970 and 1986
in each of four cities Atlanta,
Chicago,
Dallas
and Oakland
. It includes the first sale price, second sale price, first sale date,
and second sale date. This dataset is somewhat outdated, and of interest only
to researchers. Related Links of Interest The official website of the Home Equity Protection project: The Neighborhood Reinvestment Corporation site dedicated to the HEP project:
Articles related to the Home Equity Protection project: The ICF Real Estate Initiative page: | ||||||||||
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