U.S. Has 7.2 Million Affordable/Available Rental Homes Gap
No state has an adequate supply of housing for the lowest-income renters, The National Low-Income Housing Coalition reported.
The NLIHC report, The Gap: A Shortage of Affordable Homes, authored by Donna Kimura, said the U.S. has a “staggering shortage” of 7.2 million affordable and available rental homes for extremely low-income renter households, defined as those with incomes at or below the poverty level or 30% of their area median income.
The report (http://nlihc.org/sites/default/files/Gap-Report_2017.pdf) calls for expanding investments in affordable housing programs that serve those with the lowest incomes.
Diane Yentel, NLIHC president and CEO, said another way of looking at the shortage is for every 100 of the lowest-income renters, there are just 35 homes that are affordable and available to them. “This leaves over 8 million of the lowest-income people paying more than half of their limited income on rent each month, leaving very little for healthy food, for savings, or to cover an unexpected financial emergency,” she said.
The severe shortage of rental homes affordable and available to the lowest-income households predates the Great Recession but has worsened in recent years, the report said. In 2007, 40 affordable and available rental homes existed for every 100 ELI renter households and 67 existed for every 100 renter households with incomes at or below 50% of the area median income. A small surplus of affordable and available rental homes existed at 80% and 100% of the AMI in 2007. Since then, the supply of affordable and available rental homes (relative to demand) has declined even at these higher-income levels. Renter households at 100% of the AMI, however, still enjoy a surplus nationally and in most markets.
The report said the lowest-income renter households face a shortage of affordable and available rental homes in every state. The supply ranges from 15 affordable and available homes for every 100 ELI renter households in Nevada to 59 for every 100 ELI renter households in Maine. For the 50 largest metropolitan areas in the United States, the supply ranges from 10 affordable and available rental homes for every 100 ELI renter households in Las Vegas to 47 in Providence, R.I.
“[This] highlights the urgent need for an increased national investment in more homes affordable to the lowest-income people,” Yentel said, noting that federal housing programs serve about 5 million low-income households, but the needs of many more families go unmet.
Additionally, the report said of the 8 million severely cost-burdened ELI renter households, 84% are seniors, are persons with disabilities, or participate in the labor force. Many others are in school or are single adults caring for a child or a person with a disability.
This shortage persists, NLIHC said, despite for the first time since the recession, U.S. household income increased significantly during 2015. Gains were seen even among the lowest income households, with the poverty rate declining from 14.8% to 13.5%.
“Millions of people, however, continue to struggle economically,” the report said. “Household income for the poorest 10% of households remains 6% lower today than in 2006, and more than 43 million Americans remain in poverty, many of whom struggle to afford their homes.”
The report said 71% renter households are severely cost-burdened, spending more than half of their income on rent and utilities. These 8.1 million severely cost-burdened households account for 72.6% of all severely cost-burdened renter households in the U.S.
