Affordable Housing Update

430 Pico Affordable Housing, Brooks + Scarpa

The impact of COVID-19 has been especially severe on low-income and those of modest economic means, and the lack of affordable housing places additional pressure on house prices and rent rates, further eroding affordability. Attaining a vibrant housing market depends heavily on whether the market can provide a broader and more affordable range of housing options for tomorrow’s households.

As reported on Habitat for Humanity’s website, based on a 2019 report:

“The latest data shows that nearly 38 million households nationwide — 31.5% of all households — are paying more than 30% of their incomes on housing. That’s 20.5 million renters and 17.3 million homeowners. This is just a slight half-percentage point drop from the previous year. Homeowners saw nearly all of the modest improvement, while a near-record share of renters — 47.4% — still face unaffordable rents. In the nation’s hottest housing market areas, those struggling with unaffordability increasingly include higher-income renters.”¹

A majority of housing being built now tends to be for the higher end of the market. The relative lack of smaller, more affordable new homes suggests that the rising costs of labor, land, and materials make it unprofitable to build for the middle market. By restricting the supply of land available for higher-density development, regulatory constraints and not-in-my-backyard (NIMBY) opposition may also add to the challenges of supplying more affordable types of housing.¹

The lowest-income families are often forced to make impossible choices between shelter and food, healthcare, education, and other basic needs. This deprivation is severe, predictable, and avoidable. Access to a stable, decent, affordable, and accessible home is essential to virtually every area of a person’s life. Housing is intrinsically connected to better health outcomes, economic mobility, employment prospects, and greater opportunities for people exiting the criminal justice system.²

Here are some questions that these studies point to: 

• How might local zoning be reformed to increase rental and for-sale supply, especially at lower price points? 
• How do we create increased down payment assistance to access safe, affordable mortgages
• Localities, states, and the federal government should lead the efforts to provide lasting, affordable rentals. How might subsidies be retargeted towards the lower-income, first-time homeowners, and lower-income renters?
• What would broader access to safe credit look like?

¹The State of the Nation’s Housing 2019. Joint Center for Housing Studies of Harvard University.

²The Gap: A Shortage of Affordable Homes. March 2019. National Low Income Housing Coalition.