Fact of the Week: Only 35 affordable and available rental units exist for every 100 Extremely Low Income renter households


April 6, 2017

Despite the fact that the number of individuals living below the poverty line decreased during 2015, millions are still struggling to get by. According to the National Low Income Housing Coalition’s recent report, The Gap: A Shortage of Affordable Homes, “household income for the poorest 10% of households remains 6% lower today than in 2006, and more than 43 million Americans remain in poverty.” A key part of the struggle for those 43 million Americans is the lack of affordable housing that exists across the country.

The report’s objective is to measure the availability of rental housing affordable to extremely low income (ELI) households. Extremely low income households are defined as having income at or below either the poverty guideline or 30% of their area median income (AMI), whichever is higher. According to the most recent report, published last month, “ELI households face the largest shortage of affordable and available rental housing and have more severe housing cost burdens than any other group.” Simply put, the lowest income households struggle to access affordable housing because there is simply not enough of it.

In fact, according to NLIHC’s report, there are only 35 affordable and available units for every 100 ELI renter households. This means that there is a shortage of 7.4 million affordable rental homes for the 11.4 million ELI renter households. Consequently, 71% of ELI renter households are paying more than half their income on housing costs. Households paying so much of their income on housing are defined as severely cost-burdened, while households that spending more than 30% of their household income on housing costs are called cost-burdened, as the report’s graph shows. While the hardship is more acute for severely cost burdened households, both groups are left struggling to pay for other basic necessities such as food, medicine, and transportation.

affordable housing - cost burden by income group

Obviously, safe, affordable housing is important. Why? It’s a foundation for success (no pun intended). According to another report produced by the National Low Income Housing Coalition, prepared for the Campaign for Housing and Community Development Funding (CHCDF), studies have shown that living in affordable housing has a multitude of positive impacts for low-income and vulnerable populations, including seniors and individuals with disabilities. The many benefits for those who have access to affordable housing and the economy as a whole include:

    • Decreased rates of homelessness and poverty
    • Improved educational outcomes and upward economic mobility
    • Improved mental and physical health, and overall well-being including decreased rates of food insecurity and successful early childhood development, and
    • A stronger economy

So how do we increase the supply of affordable housing? The main solution, according to the report, is the “realignment of federal housing expenditures to meet our most critical housing needs.” This means shifting investments in housing to the programs that low- to moderate- and very low-income households rely on to afford housing. The report shows that higher income homeowners currently receive “a significantly greater share of federal housing expenditures than low income renters, predominantly through the mortgage interest deduction (MID).” The MID is a federal tax expenditure of more than $65 billion per year, 84% of which goes to households with annual income greater than $100,000. By stark comparison, less than $38 billion was spent on all HUD housing programs for the lowest income households in 2014. These programs include, but are not limited to, Public Housing, Housing Choice Vouchers, Section 8 Project Based Rental Assistance and affordable housing initiatives targeted to the elderly and disabled. When millions lack access to affordable housing and 71% of ELI renter households spend more than half of their incomes on rent and utilities, investments in affordable housing should be a priority for our nation’s leaders.

President Trump doesn’t seem to think so. His budget blueprint, released last month, shows that investments in affordable housing are not a priority, despite his claims that he would “make America great again.” In fact, his budget calls for $6.2 million in cuts to HUD – 13% of its FY16 funding levels, which would be devastating to programs in the Department of Housing and Urban Development. Along with these cuts comes a major decrease in funding levels for other programs that millions of low-income households rely on. Overall, Trump wants to cut non-defense discretionary programs by $54 billion and shift that money to the Pentagon. This is highly problematic for many reasons, including the fact that we already know that there is $125 billion in waste in the Pentagon. While Trump argues that his budget will not impact the availability of affordable housing for those who need it, we know that is indeed an “alternative fact.”

We must defend these programs that so many rely on. We must fight for a budget that invests in programs that will build an economy that works for all. Please take action to do just that: sign and share our petition asking for a People’s Budget that works for all and not just the very wealthy.

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