HUD Study Demonstrates Need for More Affordable Housing

HUD recently released its study, “Worst Case Housing Needs 2007: A Report to Congress,” based on data from the American Housing Survey conducted between May and September 2007. While the report does not address much of the economic impact on American renting households due to the current housing crisis (which HUD expects to include in its next Worse Case Needs report), it contains some significant findings that highlight the problems facing low-income rental households, including:

• In 2007, the number of households with worst case housing needs was 5.91 million, comprised of nearly 13 million individuals.
• The primary cause of worst case needs was severe rent burden, in which households paid more than half their monthly income for rent. Another 190,000 households lived in severely substandard housing, and 240,000 households had both problems.
• In general, worst case needs were more prevalent among extremely low-income families. A majority of households (4.33 million) had extremely low incomes (less than 30 percent of area median income), and a smaller, but substantial portion (1.58 million) earned between 30 percent to 50 percent of their area’s median income.
• Worst case needs were found across different types of families. Among the 5.91 million worst case needs households, 2.19 million were families with children, 1.21 million were elderly households, 602,000 were non-elderly disabled households, and 1.91 million “other” households.
• In addition to the 602,000 non-elderly disabled households, there were 404,000 families with children who had an adult with disabilities present, bringing the combined total of these two types of households with disabilities and worst case housing needs to more than 1 million. Disabled households were found to have the highest likelihood of having worst case needs among the four main family types (families with children, elderly, disabled, and "other" households).
• Worst case needs were found across racial and ethnic groups. There were 2.92 million non-Hispanic white households, 1.35 million non-Hispanic black households, and 1.23 million Hispanic households with worst case housing needs.
• Worst case needs were found across national regions and across central cities, suburbs, and non-metropolitan areas. In the West, 40.0 percent of very low-income renters had worst case needs in 2007, while the incidence in the South was 37.4 percent and 36.2 percent in the Northeast. The Midwest had the lowest incidence, yet in this region too, more than one-third of very low-income renters, 34.3 percent, had worst case needs. Nearly equal shares of these households lived in central cities (37.7 percent), suburban areas (34.7 percent), and non-metropolitan/rural communities (32.1 percent).
• During 2007, near half (46 percent) of households with children that experienced worst case needs were working the equivalent of full time and earning at least minimum wage.

Behind every number is the story of a person or a family struggling to maintain affordable housing,” says HUD Secretary Shaun Donovan. “Whether these worst case needs are caused by general market conditions or by the lack of federal investment in affordable rental housing between 2001 and 2007, the Obama Administration is not willing to turn a blind eye toward the absolute need we’re seeing across our nation.” He adds that HUD has increased its investment in affordable housing to meet the increase in worst case housing needs that developed over the past few years.

Key elements of the president’s proposed fiscal year 2011 budget for HUD affording housing and economic development activities include:

(a) transforming HUD's rental assistance by consolidating 13 separate programs into one streamlined program to preserve the existing affordable housing stock;

(b) i

nvesting $1 billion for the National Housing Trust Fund to support state and local affordable housing production; and

(c)

building on the American Recovery and Reinvestment Act to increase family incomes and job growth through key economic development. This includes a $150 million Catalytic Investment Fund to stimulate local economic innovation and $250 million for the Choice Neighborhoods Initiative to transform neighborhoods with concentrated poverty into sustainable mixed-income communities.

The full report on worst case housing needs can be downloaded from the HUD user portal (www2.huduser.org).