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Success Story

Market Value Analysis: New Orleans

In New Orleans, Reinvestment Fund’s Market Value Analysis (MVA) tool is already allowing city planners to make better-informed decisions about where to direct dwindling development funds. The new data may be helping to make the case for change.

In the past, when forced to decide whether to demolish a blighted property or invest in it, the New Orleans Redevelopment Authority (NORA) relied on an informal assessment of the neighborhood and how the area was likely to be affected by either course of action.

Using the MVA tool, which came on line in March 2013, the Authority now can rely on extensive metrics on the neighborhood in question, such as the median sales price, subsidized rental units as a percentage of the overall rental market, and the percentage of homes that are owner-occupied.

“It helped substantiate and reinforce many of the things that we knew anecdotally,” said David Lessinger, NORA’s Director of Planning and Strategy. “Now we have solid data on which to base our decisions. It shows we’re not making decisions capriciously.”

“We knew that certain neighborhoods were more disinvested than others, that certain neighborhoods had higher foreclosure than others, but we didn’t really have the data to support it,” he said.

Using the New Orleans MVA, the Authority can now make better decisions to reach its strategic goals in an environment of limited government funds. NORA’s task is partly driven by post-Katrina damage but also by pre-existing urban blight, reflecting what Lessinger said is four decades of disinvestment.

NORA owns close to 3,000 properties. Although many of them are unlikely to be put on the market any time soon, they will nonetheless be analyzed by the MVA process in order to develop a more accurate picture of how specific development decisions will influence the Authority’s strategic goals.

In addition to blighted land assessments, the tool also allows NORA to identify the location of key city investments such as schools, parks and libraries in relation to the market types described by the MVA.

Knowing that a school is in a neighborhood that shows signs of “disinvestment” as evidenced in the MVA may encourage the Authority to invest in housing or prioritize maintenance of empty lots so that children don’t have to walk past blighted property on their way to school.

“The goal is to be more strategic and continue to deliver more impact with fewer resources,” Lessinger said.

In the case of properties that will be retained rather than sold or demolished, using the MVA will allow the Authority to budget for their maintenance until they are sold.

In addition, the MVA provides an overview of the city, indicating the strength or weakness of adjoining neighborhoods.

“It shows the gradient,” Lessinger said. “That’s really useful because you can see more comprehensively where your strong markets are, especially where they bump up against weaker markets.” The tool also shows disinvested markets, allowing planners to make decisions in order to prevent blight from spreading to surrounding areas.

The MVA has also shown officials that the city as a whole is in better shape than previously believed, Lessinger said.

“The most surprising thing was that there were fewer really, really weak markets than we expected,” he said. “It’s going to be the baseline that we use to inform much of our planning.”