Rental Housing Affordability a Growing Problem

A report from Harvard University highlights a growing problem with housing affordability in the U.S.:

“We’re in the midst of the worst rental affordability crisis this country has known,” says Shaun Donovan, secretary of the Department of Housing and Urban Development (HUD). “What we have is a perfect storm that has wrought together longer-term demographic changes that are driving people to rental housing. On top of that you have people’s incomes getting crushed during this period.”

A record high 8.5 million low-income families are paying half their salary for rent, Donovan says, and it’s becoming a growing crisis as that number has jumped 43 percent from 2007.

In other words, one in every two households are paying more than 30 percent of their income on rent, and one in every four are paying more than half of their income on rent, according to this year’s Harvard Joint Center for Housing Studies’ America’s Rental Housing: Evolving Markets and Needs report…

The report points out that the number of renters who qualify for housing assistance increasingly outpaces the assisted units. The number of potentially eligible households ballooned from 15.9 million in 2007 to 19.3 million 2011, while the number of very low-income renters benefiting from some form of support only increased from 4.4 million to 4.6 million.

The housing voucher program has been the main vehicle for expanding assistance. “Between 1997 and 2004, increases in funding and improvements in program management helped to lift the number of vouchers by some 649,000. But despite a 12 percent increase in outlays for the program from 2007 to 2012, higher market rents and utility costs—along with income losses primarily resulting from recession-induced unemployment—raised the per tenant cost of vouchers, thus leaving the number of assisted renters almost unchanged,” says the report.