Although the nation is seeing its housing recovery make steady progress, challenges still remain, according to The State of the Nation’s Housing report.
Harvard’s Joint Center for Housing Studies’ (JCHS’) latest report points to signs of encouragement, like robust rental demand, the pickup of income growth, and a rise in sales, prices, and new construction of single-family homes.
But it also highlights the obstacles many Americans face, statistics the affordable housing industry know all too well.
Even though multifamily construction is booming across the nation, much of this new housing is geared toward the upper end of the market, keeping rents out of reach of a typical renter making $35,000 a year.
Adding to that, between 2005 and 2015, the number of renter households surged by nearly 9 million, the largest increase over any 10-year period on record. “As much as we’re building new housing, we can’t keep up with the pace of demand,” says Chris Herbert, JCHS managing director.
And that is evident in the number of affordable and available units for low-income renters. In 2014, according to the National Low Income Housing Coalition (NLIHC), only 31 rental units were affordable and available for every 100 extremely low-income renters, those with incomes at or below 30% of the area median income (AMI). Only 57 affordable and available rental units were available for every 100 very low-income renters, those with incomes at or below 50% of the AMI.
These factors are particularly painful for low-income households. In fact, the number of cost-burdened renters, those who pay more than 30% of their income for housing, broke another record in 2014, jumping from 20.8 million in 2013 to 21.3 million. More than half of these renters, 11.4 million households, are considered severely cost burdened, paying more than 50% of their income for rent.
The number of very low-income households eligible for federal rental housing assistance has increased by 3.8 million from 1993 to 2013, but the number of assisted renters only grew by 532,000 during this same timeframe.
Many of these cost-burdened households are forced to cut back on their spending for other vital needs, such as health care and food. They also are at risk of dislocation, evictions, and concentrated poverty.
The number of people living in neighborhoods with poverty rates of 40% or higher more than doubled between 2000 and 2014—from 6.5 million to 13.7 million.
During the release of the report, industry panelists called for a comprehensive housing strategy.
“We’re not funding affordable housing solutions at the scale to meet the need,” says Diane Yentel, NLIHC president and CEO.
With the increased number of households who are cost-burdened comes an increased awareness of the problem. “I think that increased awareness ultimately will translate into increased political will,” says Yentel. “We don’t lack an understanding or solutions, we lack political will, but we are starting to see a shift there.”
Yentel points to the efforts on Capitol Hill to increase the National Housing Trust Fund and expand the low-income housing tax credit program as well as the Obama administration’s $11 billion request to end family homelessness.
“The increased awareness of the problem and increased willingness to not shy away from the costs will ultimately get us to the solution.”