U.T. Dallas Professor To Study Public Housing, Homeowner Perceptions In Far North Dallas

The United States Department of Housing and Urban Development (HUD) has awarded Dr. Nathan Berg, an economist at The University of Texas at Dallas (UTD), a $55,000 grant to study why property values change when new public housing sites are built nearby.

Berg’s study will utilize home sale data to measure market responses following the announcement of new public housing developments in affluent Far North Dallas neighborhoods.

“Economists looking at the stock market over the last decade have developed a variety of techniques for studying overreactions and irrationality,” said Berg. “The major goal of this project is to apply those techniques to the real estate market in North Dallas, hopefully helping homeowners and public housing advocates make progress toward resolving ongoing disputes.”

According to Berg, the controversy in North Dallas also offers an ideal opportunity to study the role psychology plays in determining home prices.

“Because three new public housing sites in North Dallas were announced but only one was built, researchers have been handed an opportunity to learn about the role psychological biases play in determining how much people are willing to pay for a house,” Berg said. “These opportunities, which economists refer to as ‘natural experiments,’ don’t come along every day.”

In addition to measuring how psychological factors influence market prices, results from Berg’s study could actually help markets to perform better in the future. For example, if the study indicates public housing only affects property because of a short-term overreaction, that knowledge could help keep property values from falling and reduce opposition to public housing the next time the issue arises.

Berg’s award is part of HUD’s Urban Scholars Postdoctoral Fellowship Program and is administered by the National Research Council in Washington, D.C. It is bestowed to approximately ten recent Ph.D. recipients in academic positions for a term of fifteen months.

School of Social Sciences Dean Jim Murdoch and two graduate students will work with Berg on the project. Results will be reported to HUD and could be used to help identify and solve demographic and economic challenges in metropolitan areas across the country. Berg’s research will begin on or before September 1.

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