The Joint Center for Housing Studies of Harvard University released a new report, America’s Rental Housing 2024, on January 25. The biennial report analyzes data from sources like NLIHC, the U.S. Census Bureau, the U.S. Bureau of Labor Statistics, HUD, and real estate firms to provide new insights into the characteristics of and challenges faced by renter households, as well as the current state of the rental housing stock and rental markets.
The report reveals that the number of renters in the U.S. increased by more than 100,000 households in 2023, after declining between 2021 and 2022. Despite the associated rise in demand, rent prices have stabilized after two years of rapid growth, likely due in large part to the introduction of new units into the rental market targeting middle- and higher-income renters. Nonetheless, rents are still well above pre-pandemic levels in most of the country, resulting in a record-breaking number of renter households facing housing cost burdens.
In 2022, half of all renter households spent more than 30% of their income on housing costs (making them “moderately cost-burdened") and over a quarter of all renter households spent more than 50% of their income on housing costs (making them “severely cost-burdened"). Among renters with annual household incomes below $30,000 (roughly a third of all renters), more than 80% were moderately cost-burdened and roughly 65% faced severe cost-burdens. Such cost burdens significantly impact the housing stability of the lowest-income renter households. In 2022, the median cash savings among renter households with incomes below $30,000 was just $300, forcing many of these renters to choose between rent and other critical household expenses like food or healthcare needs. Renter households headed by a Black person were more likely to have household incomes below $30,000 (42% of all renter households headed by a Black person) and/or to be cost-burdened (57% of all renter households headed by a Black person) than those headed by a White person (30% and 45% of renter households, respectively), reflecting the continued impact of discrimination and systemic inequality on Americans of color.
The continuing decline in the supply of affordable rental housing makes it even more difficult for the lowest-income renters to remain safely housed. The report highlights that an estimated 2.1 million affordable units have been lost over the past 10 years, half a million of which were lost between 2019 and 2022 alone as rents skyrocketed during the pandemic. More units are expected to be lost by 2029, as the affordability period ends for more than 325,000 units created through the Low-Income Housing Tax Credit (LIHTC) program. Millions of the remaining affordable units are aging and in need of repair, are otherwise physically inadequate due to a lack of basic utilities like heat or air conditioning, or are located in areas at increasing risk of sustaining impacts from environmental hazards like floods, hurricanes, and wildfires. Furthermore, many units do not have the accessibility features needed to support a growing number of low-income renters aged 65 or older. A 2023 Freddie Mac survey cited by the report demonstrated that nearly 50% of renters with disabilities found their homes minimally or not at all accessible.
Despite the growing need, federal housing assistance programs have fallen short. Over the last two decades, the number of very low-income renter households increased by 4.4 million, while the number of these households receiving assistance increased by only 910,000. The report emphasizes that the continued inadequacy of federal housing support systems is directly linked to the spike in the number of people experiencing homelessness, especially when coupled with the expiration of expansions in legal protections for tenants, rental assistance programs, and other aspects of the social safety net that helped keep the lowest-income renters housed during the pandemic. As of January 2023, more than 653,000 people were recorded as experiencing homelessness – nearly 71,000 more people than were reported the prior year – making the number the highest ever recorded.
The report applauds the efforts of many state and local governments to address the widening gap between federal housing assistance and the needs of low-income renters through rent regulation, programs to provide capital for affordable housing development, the removal of legal barriers to the construction of new affordable multifamily properties, increases in legal protections and rental assistance for renters, and investments in programs to house people experiencing homelessness. However, the report stresses the need for more support across all levels of government. In particular, the report notes that “the need to expand housing subsidies remains a pressing priority” as the number of low-income renters grows and the supply of affordable rental housing continues to shrink.
Read the report at: https://bit.ly/42cbzJ3