Deanna Newton (Pepperdine), Tenure Mismatch Theory: Rethinking Federal Housing Subsidies Through Property Law, 80 Tax L. Rev. ___ (2026):

Researchers estimate that the United States has “3.8 million fewer homes” than are needed; yet, existing housing subsidies often fail to produce long-term affordable housing. This Article makes two novel contributions to the literature by positioning the problem at the intersection of property law and tax law. It argues that the failure of federal housing subsidies is not merely a problem of inadequate funding, poor targeting, or lax oversight, but a legal design problem rooted in the interaction of property law and tax law.

First, it introduces tenure mismatch theory, which identifies a structural problem in how housing subsidies interact with property ownership. The theory shows that federal housing subsidies are ineffective when they operate within a speculative tenure system, which prioritizes appreciation over long-term affordability. In contrast, a non-speculative tenure system limits owners’ appreciation and embeds long-term affordability through restrictions on transfer. Community land trusts, nonprofit organizations that hold land in trust for community benefit and preserve affordability by separating the value of the land from the buildings, operate within a non-speculative tenure system. Second, this Article uses community land trusts as a case study to propose a federal tax credit for contributions that direct capital into ownership structures that preserve long-term affordability.

By grounding tax credit design in property law, the proposal shows that the effectiveness of housing subsidies depends not only on who receives capital, but on the tenure system into which the subsidy is delivered. It allows a diverse group of taxpayers to receive a federal tax credit when contributing to community land trusts, extending participation beyond developers and institutional investors to everyday taxpayers. This Article also explains the shortcomings of current economic development tax incentives and emphasizes mandatory reporting, anti-abuse mechanisms, and ongoing monitoring and oversight throughout enactment, implementation, and post-implementation.

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