Thursday, February 24, 2011

Latest Report from the Center for Housing Policy: Housing Affordability Challenges of America's Working Households

Today, the Center for Housing Policy released Housing Landscape 2011: An Annual Look at the Housing Affordability Challenges of America’s Working Households. The report finds that despite falling home values and the general perception that housing affordability is improving, the number of working households spending more than half of their income on housing costs rose to 10.5 million, an increase of 600,000 from 2008 to 2009.

Housing Landscape 2011 uses American Community Survey data to compare housing costs and incomes for low- and moderate-income households that averaged at least 20 hours at work per week during the two-year study period. The Center found that the share of working households with a severe housing cost burden rose from 21.1 percent to 22.8 percent. The increase was more pronounced among working renters – rising to 24.5 percent – primarily because rents rose slightly and incomes fell sharply on a nationwide basis. And as the map shows, the 25 states where affordability worsened significantly for working households stretch from coast to coast. In no state did affordability improve significantly.

When you think about it, these findings make sense, right? Falling home prices only benefited those who bought a home in 2009. The mortgage payment didn’t go down for most homeowners, even though the value of their home – and their equity – fell, sometimes dramatically. With more people looking for an affordable place to rent, it follows that vacancy rates tightened and rents rose at the bottom end of the market, as HUD’s recent report suggests. And these trends occurred in the context of rising unemployment and increasing financial hardship.

Far from improving in recent years, this report shows that America’s affordable housing challenges have worsened significantly. But they are not insurmountable. As federal, state, and local governments look for ways to balance their budgets, these findings underscore the importance of preserving programs that provide affordable housing options for low- and moderate-income renters and owners, particularly in these troubled economic times.

No comments: