A 26-year-old Capitol Hill mother of three keeps a sharp eye on her neighbors because she wants to copy them. Even though she pays only $9 a month for her home, when her more affluent neighbors plant flowers, so does she. Since their children don't play in the front yard, neither do hers.

The woman doesn't want anyone to know that she is head of one of five public housing families in the 1300 block of E Street NE, who live in homes indistinguishable from those on the block that sell for $100,000 and more.

While public attention and criticism has been focused on the 12,000 units in the District's large, dilapidated, crime-laced public housing apartment projects, the city for 12 years has quietly placed 500 poor families in publicly owned, single-family homes.Most of them are scattered throughout Northwest Washington east of 15th Street.

In the next two years, the city plans to greatly expand this program by buying 2,000 more single-family homes, cooperatives and small apartment buildings throughout the city, even in predominantly white and affluent Ward 3, the area west of Rock Creek Park.

The dispersion of the poor into middle-class apartment buildings and single-family homes began when the D.C. Housing Department bought a 20-unit building in Southeast Washington near Mayor Marion Barry's home two months ago. But the purchase ran into severe opposition from nearby black homeowners.

Although the city proposed allowing some nearby residents to help screen tenants for the building (a proposal later nullified by federal housing officials), homeowners said they feared the apartments would become a neighborhood eyesore that would threaten their property values.

Like homeowners, some poor families living in the scattered-site, publicly owned homes cut their grass and plant roses and azaleas, while others watch their yards turn to weed patches or let their children run rampant.

Some play loud music and annoy their neighbors, while others are praised by their neighbors for their well-kept homes. Some homeowners remain unaware that they share their blocks with public-housing families.

The north side of the 1300 block of E Street is unusual because of the large numbers of public-housing families who live on a block in the throes of Capitol Hill restorations. But contrary to the belief of some, their residency has not diminished property values, deterred white, middle-class professionals from buying the expensive rehabilitated homes or frightened longtime black homeowners into moving.

The reason is simple: The two-story, brick row homes are well kept.

"I don't want anyone to come down the block and point to my house and say, 'Well, that's a welfare recipient's house. Just look at it.' I want it to be equal," said the 28-year-old woman, voicing the feelings expressed by some of the other families.

Charles L. Weaver, former president of the now-defunct block association, agreed.

"We have no objection as long as they try to blend in and try to improve. If they are helping to upgrade the neighborhood, we don't have any squawk at all," he said. "I can't say that they have brought any problems in the neighborhood."

D.C. City Council member John Ray, who lives in an apartment house on the block, said there should be more poor families dispersed in the neighborhoods because "when you mix them in with others it gives them an incentive to keep their property up."

But some neighbors had complaints.

One couple said while most of the public housing families are "very quiet," one particular family "gives you a headache. I don't know why the government would bring those kind of people here," the wife said, citing the disruption of all-night parties, "loud, bad language" and loud music.

Another neighbor said that while one family was something of a problem, she thought a second public-housing family who lived behind her on Emerald Street was worse.

"All those children running in and out, and the mother cusses," she said. "There are cars in the alley all night. They need to get them out of the block."

Some Emerald Street homeowners agreed that while most of their eight poor families never caused any trouble, there was "one problem house."

Large families with two parents, where either the mother, father or both work, and who have proved to be good housekeepers are selected for the homes, according to Barbara A. Bess, director of the scattered-site housing program.

Families pay rents generally ranging from $30 to $300 a month, plus their own utility bills. They generally have higher incomes than most public-housing families.

By law, public-housing tenants can pay only 25 percent of their income for rent, and that rent is reduced if they must pay their utility bills.That is the reason the Capitol Hill woman pays only $9 a month in rent. The average public-housing tenant earns about $4,200 a year and is a single mother with several children who receive public assistance.

"We tell them we want them to take pride in where they live and the fact that they are surrogate homeowners gives them pride," Bess said.

Acting like homeowners, some of the E Street families and those in other city-owned homes have painted, performed minor repairs, installed carpeting and replaced broken windows. Under terms of their tenancy, the families are required to make minor repairs and only call the city for help with major maintenance.

As in the projects, the city sometimes is very slow to perform certain maintenance jobs, some families complained.

One Northeast family said they called the department for three years, requesting repairs for a leaking roof. Finally, after part of the ceiling fell in, the roof was fixed, but the family then was left to paint and replaster water-stained walls.

Bess agreed that the department does not respond quickly to requests for major maintenance. She said the city has trouble finding contractors willing to do the work.

The families say they are overjoyed to live in the homes because they and their children have escaped the stigma and hopelessness of the projects.

"I was so happy when they showed us this house we moved in that night and slept on the floor," said Delores Holland, 47, who lives in the 1300 block of E Street with her husband and three grandchildren.

They had lived in a small apartment near 14th Street NW. But she said she wanted to move the children away from "the drugs in the hallways, the gambling and the drinking. But not to the projects, because that would only mean more of the same."

Holland's youngest son died of a drug overdose at 17, and her daughter, whose children live with her, is in jail, she said.

"The grandchildren are better than my children," she said, as she sat in her meticulously clean house.

"I raised mine around 14th Street, and every time I turned around they were in trouble . . . The grandchildren are into things, but these are good things -- baseball, soccer and boxing," she said, as she pointed to a bookcase displaying a half-dozen trophies.

"In the projects you're not looked up to and your kids are singled out as being from the projects," said one Northeast D.C. father, whose family used to live in the now-demolished Parkside project.

"So many parents are lazy and trifling and no good, and they just wait for that (welfare) check every month," he said, as he hurried to leave for his job in the federal government.

Larry Johnson, 18, of Brookland, said he believes living in a home in a nice community has kept him out of jail.

"If you grow up in the projects you have no choice but to be a hoodlum unless you are an exceptional person," he said. "It's a bad environment . . . But up here we can see people striving for a better life."