Housing Cost-Burdened Renters in Los Angeles More Likely to Cut Back on Basic Needs to Afford Housing

A report from the USC Price Sol Center for Social Innovation, “How Do Renters Cope with Unaffordability? Household-Level Impacts of Rental Cost Burdens in Los Angeles,” finds that housing cost-burdened renters, who spend more than 30% of their income on housing, are more likely to have cut back on spending for other basic goods than renters who are not cost-burdened. Over 64% of cost-burdened renters reported having cut back on food spending in order to pay rent, and around a fourth of cost-burdened renters were forced to cut back for more than a year.

The report describes the findings from a door-to-door household survey of 794 renter households conducted in South and Central Los Angeles between January and October 2019. Surveyors focused on two neighborhoods characterized by high poverty, large immigrant populations, a high proportion of cost-burdened renters, and gentrification pressure. The median monthly household income among respondents was $2,600, while the median gross rent was $1,342. Seventy-three percent of all surveyed households were cost-burdened, and 48% were severely cost-burdened, spending more than half their income on rent. Respondents were racially and ethnically diverse: 56% were Latino, 14% non-Latino white, 23% non-Latino Black, and 6% Asian.

The survey found that cost-burden is not evenly distributed by race and ethnicity. While white and Asian households were less likely to be cost-burdened, Black households were more likely to be cost-burdened. Spanish-speaking households were also more likely to be cost-burdened: 20% of all households did not have someone over age 14 who spoke English as their primary language, compared to 25% of severely cost-burdened households.

Renters who were cost-burdened were more likely to make cutbacks in basic needs. Sixty-four percent of cost-burdened renters had cut back on food, compared to 57% of non-cost-burdened renters in these neighborhoods. Twenty-four percent had cut back on health and medical needs in the past two years, compared to 16% of non-cost-burdened renters. They found that cost-burdened and severely cost-burdened households were cutting back at roughly similar rates.

Respondents were also asked whether and how they could cover an unanticipated $400 expense. Around a fifth of all respondents reported they would be unable to pay it, and 40% would have to take on debt. While 92% of non-cost-burdened renters said they would be able to pay such an expense, just 77% of cost-burdened renters would be able to pay it.

The report provides further support to the idea that cost-burdened households must make significant sacrifices to pay the rent—whether that be through cutting back on food, clothing, medical care, education, transportation, or forgoing other debt payments. The survey questions on the length of such cutbacks shows that for many households, this deprivation is not a temporary hardship but rather something that many households endure for years.

The report can be found here: https://bit.ly/3agdLX0