The Joint Center for Housing Studies of Harvard University’s 2013 State of the Nation’s Housing, released on June 26, reports that although the housing market appears to be recovering from the recession, lingering effects of the housing crisis remain in both the rental and sales markets. According to the report, more families face severe housing cost burdens than ever before, especially those with low incomes. The report attributes the housing recovery in part to widespread household growth of almost 400,000 in 2012 alone due to strong immigration and the built-up housing demand among young adults previously unable to start households due to the recession. The majority of these households seek to rent rather than buy their own homes. Despite growing home sales, new construction, and rising home prices the national rate of homeownership dropped to 65% in 2012, reflecting a net loss of 162,000 homeowners since 2011. The rental market, meanwhile, continues to grow by more than a million households per year, and 257,000 new rental units were constructed across the country in 2012. Vacancy rates in rental apartments remain below 5% and yearly increases in rent outstrips the inflation rate, demonstrating that demand for rental housing is still high. However, the majority of growth in the rental market takes the form of luxury and high end units, while the quantity of units affordable to low income renters is steadily shrinking. In 2011, there were only 6.8 million affordable units for 12.1 million extremely low income renters nationwide. This affordability gap is exacerbated by higher income households competing with low income renters for affordable units as well as by widespread structural inadequacy in affordable housing stock. As a result, there exist only 30 adequate, available, and affordable units for every 100 extremely low income households in the United States. Furthermore, over 12.8% of the nation’s supply of low cost housing, or 650,000 units, have been permanently lost since 2001. The gap between affordable units and low income renters in need of housing continues to widen each year. An increasing number of households across the country are severely cost burdened as the housing recovery raises housing prices while persistent unemployment keeps real incomes low. In 2011, 20.6 million households, or 17.9% of the population, spent more than half of their annual income on housing costs. The report emphasizes that those with the lowest incomes suffer from the highest housing cost burdens, and that almost 70% of households with annual incomes of $15,000 or less are severely cost burdened. The Joint Center characterizes severe cost burden as a problem of income inequality. However, federal programs intended to lessen this inequality have fallen victim to budget cuts. Federal rental assistance programs such as public housing, Community Development Block Grants, and the HOME program have faced widespread funding cuts in recent years. Furthermore, HUD housing assistance programs reach just one out of every four eligible households. The 2013 State of the Nation’s Housing report was released during a panel discussion on housing challenges in the United States on June 26 at the Joint Center for Housing Studies at Harvard University. The panelists emphasized the importance of ensuring equitable and affordable housing opportunities for low income households, and commented on the housing challenges low income Americans continue to face. “The high end of the [housing] market is growing but the low end is shrinking,” said panelist Debra Still, President and CEO of Pulte Mortgage. Eileen Fitzgerald, CEO of Neighborworks, added, “We have an income problem when housing costs more than people have.” Access the full report here: http://bit.ly/15GCrvVRead Sheila Crowley’s statement on this report here: http://nlihc.org/press/releases/2659