- More than 40 million units have been built over the past three decades, accommodating 27 million new households, replacing older homes, and improving the quality of the nation’s stock.
- The typical home today is larger and more likely to have air conditioning, multiple bathrooms, and other amenities. Structurally inadequate housing was rare 30 years ago and even rarer now.
- Nevertheless, several challenges highlighted in the Joint Center’s first report persist today. In the 1980s, high mortgage interest rates put the cost of homeownership out of reach for many. Homeownership rates among young adults today are even lower than in 1988, and the share of cost-burdened renters is significantly higher.
- Soaring housing costs are largely to blame, with the national median rent rising 20 percent faster than overall inflation in 1990–2016 and the median home price 41 percent faster.
- Soaring housing costs and weak income growth along lower and moderate income households have contributed to housing affordability pressures. Individual income growth has not kept pace with general economic gains; GDP grew 52 % between 1988 and 2018 but incomes in the bottom quartile grew only by 3%.
- Immigration has been a key driver of US household growth and will continue to be so.
- More broader policies are needed to help young millenials and non-white groups into homeownership (e.g. assistance with down payment). African Americans remains the group that has not shown increase in home ownership.
- Home ownership. after years of decline, saw an uptick in 2017.
- The number of renter households also decreased in 2017. In the 30 years, the number of very low-income families has soared by 6 million, to more than 19 million.
- At the same time, federally sub-sidized rental housing has increased by only 950,000 units while the low-cost stock (with rents under $800 in real terms) has shrunk by some 2.5 million units.
- The Low Income Housing Tax Credit program has become the largest source of subsidized housing.
- After declining by 14 percent between 2010 and 2016, the number of people experiencing homelessness increased by 3,800 last year. HUD’s Annual Homeless Assessment Report shows that nearly 554,000 people were living in shelters or on the street on a given night in January 2017, while 1.4 million peopl—including 147,000 families with children—used a shelter at some point over the course of 2016. In addition, the US Department of Education estimates that nearly 1.0 million school children were living with people outside their families in 2015–2016 because of housing loss or economic hardship, and 42,000 were living primarily on the street during the school year.
- More than half (56 percent) of the homeless population live in the nation’s highest-cost metros. Indeed, the average homelessness rate in metros with median rents in the top quintile is more than double that in all other metros. Moreover, the metros with the largest homeless populations—New York, Los Angeles, San Francisco, and Seattle—are the same high-cost markets where homelessness is increasing.
The reductions in homelessness over the past seven years largely result from targeting two populations in need of intensive support services—veterans and the chronically homeless. These initiatives emphasized additions to the supply of permanent supportive housing and the use of the “housing first” model, which houses people as quickly as possible with as few preconditions as possible.
So far, this narrow focus has helped 62 communities across the country end veteran homelessness. These limited successes do not, however, address the underlying issue of housing affordability. For low-income households, especially those spending a large share of their incomes on housing, an unexpected expense or job loss can lead to eviction. In fact, the vast majority (83 percent) of people experiencing homelessness are not chronically homeless, and many who enter shelters—especially families—come directly from more stable housing situations.
Further progress in reducing homelessness may require new approaches. Some programs use the pay-for-success model to finance interventions, such as rapid rehousing and permanent supportive housing where funding comes from investors. If the program is successful, investors receive a return and local governments save money on services. Another program that may help to prevent homelessness is the City of Stockton's plan to provide a basic income to low-income residents as an offset to rising housing costs.
For their part, state and local jurisdictions also have opportunities to reduce housing costs through regulatory reform. Allowing higher-density development and simpler housing designs, as well as streamlining approval processes, would enable and incentivize builders to supply homes affordable to a broader range of incomes. While current regulations are intended to protect the public interest, concerns for health, safety, and efficiency must be weighed against the need to reduce the costs of housing production. Striking this balance is essential if the nation is to meet its stated goal of a decent home and suitable living environment for all.