The issue: On Wednesday, City Controller Rebecca Rhynhart released a report about the impact of homicides on property values. According to the analysis, a homicide significantly decreases sale prices of houses in that neighborhood. Overall, the analysis concludes, the impact of homicides on housing values is so large that a 10% decrease in Philadelphia’s homicide rate would increase tax revenue by $13 million a year.
After every shooting that rocks our city -- or our nation -- politicians declare that even a single homicide is too much and that we should do anything to keep people safe. But support for “anything” depends on the price tag. Human life may be priceless, but lawmakers often don’t act until they see the dollar value of a social or public health problem.
The economic analysis of the controller gives more wind to calls for preventing gun violence: Action is not only important for the safety of the city’s residents, but also for the health of the city’s budget. But as another new study shows, while the city and state should do more to prevent gun violence, it’s important to resist punitive response that can be just as harmful -- for people and tax revenue.
The study — from Thao Le, a professor of real estate at Georgia State University, and her colleague Cheng Keat Tang, a professor of economics at Nanyang Technological University in Singapore — looks at the impact of an initiative to prevent gun violence in Baltimore on property values.
In the last two decades, cities such as New York City, Washington, and Chicago, along with states including Connecticut and Washington, required people who have been convicted of gun offenses to register with the police and routinely update their address. This approach is a spin-off of sex-offender registries that have proliferated, despite no proven efficacy in preventing sex crimes. The rationale behind gun-offender registries is that helping police track individuals who are deemed violent will allow them to better allocate resources and so improve public safety.
Unlike most gun-offender registries, the information of the Baltimore registry is public -- date of initial registration, name, race, gender, and full home address. “The idea is to let people know so if they don’t want to live next to an offender they can move," Le says.
The question: Using this information, the researchers sought to pinpoint the registry’s effect on housing values. To estimate that impact, they identified each time a gun offender moved to a house and then looked at the sale prices of all houses within 0.1 mile, two years before and after the move. They did the same analysis for farther-away houses. This method allowed them to “see if the house price after a [gun offender] moved in increased or decreased compared to houses further away.”
It makes a real difference: “Houses closest to gun offenders experienced a 7% decline [in housing value] after the [gun offender] moved in," Le says the study found. In Baltimore, that’s an average decrease of $9,100.
The size of the decrease in housing values from the move of a gun offender is dramatically larger than 2.3%, or $3,400, that Rhynhart’s study found. That’s surprising, because people on Baltimore’s gun-offender registry might have never even pulled a trigger. Gun offenses that would get someone on the registry include nonviolent misdemeanors like possession or transportation of an illegal firearm. The registry doesn’t provide information of the offense.
Le and her colleague did find that after a gun offender moved to a neighborhood, gun-related crime increased: “Shooting incidents increased by 5.3% and illegal firearm possession increased by 2.7%.” However, they do not know whether the people on the registry are committing these incidents, or the shootings are another byproduct of neighbors knowing a gun offender moved in. Complicating the picture is that the researchers did not find any impact on crime when a gun offender moved out of the neighborhood.
Baltimore’s gun-offender registry has been criticized for being racially biased, harming people’s efforts to reenter society, and not in fact promoting public safety -- in 2018 Baltimore experienced 75 more homicides than it did in 2008, the first year of the registry. That suggests Baltimore’s housing values are tanking twice -- once because of the stigma against people on the registry, and once because of the persistence of shootings.
Why does this matter to Philadelphia? The results are a reminder that sometimes, doing anything can be just as expensive and harmful as doing nothing. It’s also a reminder that even implementing an intervention that comes with small price tag upfront, such as maintaining a registry, can become extremely costly. The challenge for cities like Philadelphia is to maintain a level of urgency when it comes to our pursuit of solutions to gun violence, while at the same time maintaining clear heads about the full implications of any intervention -- in terms of lives saved, social justice, and taxpayer dollars.