Property management practices of federally assisted multifamily housing in Virginia: a comparison of nonprofit-owned with government- and for-profit-owned housing
Congress continues to prefer nonprofit organizations over government and for-profit investors for participation in federally assisted multifamily housing programs because nonprofit organizations are believed to be more efficient in delivering services than government and more altruistic than for-profit investors. However, empirical information to support these beliefs is limited.
The purpose of this study was twofold: a) to determine if property management practices of federally assisted, nonprofit-owned multifamily housing properties are different from those of comparable government- and for-profit-owned properties with regard to administration practices, financial management practices, maintenance procedures, and services provided to residents and b) to determine how much variance in these management practices is explained by type of owner, owner's goals for property , property manager's qualifications, and neighborhood environment. Independent t-tests and a multiple regression analysis, respectively, were used.
The population consisted of public housing and Section 8 nonprofit- and for-profit-owned, project-based properties in Virginia (197 properties total). Results were based on 96 property managers’ responses to an 81-item mailed questionnaire, which included open- and close-ended responses.
Management practices at the nonprofit-owned properties generally were not significantly different (at .10 alpha level) from those at either the government- or for-profit- owned properties. Nonetheless, some patterns were apparent. These included the nonprofit-owned properties having lower vacancy and unit turnover rates, quicker turnaround times for routine maintenance, and more initiatives to empower residents than the for-profit-owned properties. Also, management at the nonprofit-owned properties tended to conduct their maintenance more frequently and quickly than management at the government-owned properties.
Approximately 42% of the variability in the management practices of the sample was explained by type of owner, owner’s goals for property, property manager’s qualifications, and neighborhood environment. Moreover, the nonprofit-owned properties, on average, scored higher than the government- and for-profit-owned properties with regard to their overall property management practices. While these findings appear to support Congress’ preference of nonprofit organizations over government and for-profit investors for participation in federally assisted multifamily housing programs, concern exists about the financial solvency of the nonprofit-owned properties, particularly since one-third of these properties failed to meet budget goals.