The voices of Urban Institute's researchers and staff
June 16, 2015

Five things you need to know about America's rental affordability crisis

Your rent or mortgage payment is likely the largest check you write each month. It is for most households in America. For each of us, rent is the largest share of our family budget, but we are also fortunate to have many housing options that we can afford. That isn’t the case for the 11.3 million extremely low-income (ELI) renter households in the United States who face a significant shortage of affordable and available housing options. We call this problem the “affordability gap.” 

We know the policies that can close this gap, but they are not scaled to the size of the challenge. If you want to address this issue, here’s what you need to know:

  1. There is a nationwide affordability crisis and it is only predicted to get worse.

    Nationwide, only 28 affordable, adequate, and available units exist for every 100 extremely low-income renter households. In 2000, we had 37 units for every 100 ELI households, so we are losing ground. This unhappy trend is only likely to get worse with growing demand for rental housing

  2. Affordability challenges are playing out differently across the country.

    Not one county in the United States has enough affordable, adequate, and available units to house all ELI renter households. We mapped this national crisis to the county level and found that the affordability gap is lowest in the Northeast, Appalachia, the Midwest, and the Great Plains, and is highest in the South and the West.

    In America’s largest counties, this gap ranges from 51 units per 100 ELI renter households in Suffolk County, Massachusetts (where Boston is located) to only 8 units per 100 ELI renters in Denton County, Texas (where parts of Dallas and Fort Worth are located).  

    These differences are the result of different local and regional market dynamics and the legacy of federal housing policy that has not kept pace with the new geography of poverty.

  3. The federal government is an important part of solving this crisis.

    Rental assistance provided through the US Department of Housing and Urban Development (HUD) keeps housing affordable for more than 2.6 million ELI renters. The problem would be much worse without HUD assistance because the private market cannot fill this gap in most areas without subsidies to cover operating costs. 

  4. But only 1 in 4 win the housing assistance lottery.

    Over the past decade, federal investments in rental assistance have essentially flatlined, and the effects of sequestration have only squeezed limited resources. Long waiting lists for federally assisted housing are the norm, because housing assistance is a lottery not an entitlement. 

  5. Cities are stepping up to solve the crisis.

    There is some good news. Local actors—nonprofits, city and state government, private entities, and foundations—are working together and aligning funds and strategies to preserve, produce, and operate affordable rental housing for America’s poorest households. In a related feature, we explore two of these local stories: Austin, Texas, America’s fastest-growing city; and Boston, Massachusetts, whose housing community has done the most to close the affordability gap. 

Join us on Twitter on June 23 at 4 p.m. Eastern Time for a conversation about these and other pressing housing affordability issues. Erika Poethig (@Erika_Poethig) and the Public and Affordable Housing Research Corporation (@PAHRC) will lead the discussion using the hashtag #ValueofHome.

The Housing Assistance Matters Initiative is a project of the Urban Institute, made possible through support from Housing Authority Insurance, Inc. (HAI, Inc.), to provide fact-based analysis about public and assisted housing. The Urban Institute is a non-profit, nonpartisan research organization and retains independent and exclusive control over substance and quality of any Housing Assistance Matters Initiative content. The views expressed in this and other Housing Assistance Matters Initiative products are those of the authors and should not be attributed to the Urban Institute or HAI, Inc.

AP Photo/Mark Lennihan, File

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