By Rachel Smith, executive assistant
It is difficult to discuss income inequality without including affordable housing. With rising housing costs surpassing wage growth, low-income earners could be forced to spend half of their paychecks on rent by 2025, according to a recent forecast by Harvard’s Joint Center for Housing Studies and Enterprise Community Partners Inc.
Another report, by the National Low Income Housing Coalition’s (NLIHC) found that America would need 7.2 million affordable homes to meet the lowest-income, or “extremely low income,” (ELI) earners’ needs.
Nevada has the biggest shortage. There are only 15 affordable units for every 100 people in the ELI category. In most places across the U.S., that number is 35 units for every 100 people.
Current federal housing policies do not address the severe affordable housing need for ELI families and individuals. Instead, last year’s tax law reduced the value of low-income tax credits, making it less desirable for developers to build low-income housing. Additionally, recent proposed legislation includes work requirements for “able-bodied individuals” in Section 8 rental units, which doesn’t necessarily address housing needs for those at the highest poverty levels.
Diane Yentel, NLIHC’s president and CEO, says that the best solution to this problem is “better jobs for working people.” She explains that it’s not an issue of people not working hard enough; it’s an issue of not being paid enough to afford rising rent and housing costs.
Projecting Trends in Severely Cost-Burdened Renters: 2015 – 2025: http://www.jchs.harvard.edu/sites/jchs.harvard.edu/files/projecting_trends_in_severely_cost-burdened_renters_final.pdf
The GAP: A Shortage of Affordable Homes: http://nlihc.org/sites/default/files/gap/Gap-Report_2018.pdf