Are low and moderate-income families being set up for a fall by encouraging them to become home owners?

They are if they are buying in neighborhoods that don't have a reasonable probability of at least holding, if not increasing, their values, according to the first working paper published by the Research Institute for Housing America, a two-year old organization dedicated to expanding access to housing and financing.

Many neighborhood renewal programs adopt ownership as the central element of their revitalization strategies. That's fine, say the paper's three authors, who are on the staff of the Center for Urban and Regional Studies at the University of North Carolina. But many programs stop there and that could be devastating for resident owners.

As long as there are corresponding investments in infrastructure and services that result in a neighborhood that is a desirable place to live, home buyers should thrive, the authors say. But if there isn't, buyers may not realize either the economic or social benefits of ownership.

"If people buy in areas characterized by depreciating property values and serious social problems, William Rohe, George McCarthy and Shannon Van Zandt write, "the American Dream could turn into the American Nightmare."

The possibility that ownership may have a negative impact "suggests that those involved in promoting (it) should be careful not to oversell home ownership, particularly among those who are less likely to be successful," Rohe, McCarthy and Van Zandt warn.

"Recent public policy has been focused on making home ownership available to lower-income families. Although this is clearly an important and worthy goal, not everyone is capable of becoming a successful homeowner."

The paper, a critical assessment of the research into the social benefits and costs of ownership, also found that much of the existing evidence is sparse and, in some cases, inconsistence.

For example, the authors discovered the amount of research on the correlation between ownership and health is limited. For the most part, it says the relationship is positive, as long as owners are current with their mortgage payments. But the mechanism through which ownership effects health has never been established.

Corroboration of the impact of ownership on other social variables is skimpy, too, prompting Steven Hornburg, the Research Institute's executive director, to comment: "The evidence for the social benefits of home ownership are not as conclusive as often presented in public dialogue and debate."