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Low Income Housing Needs Skyrocket. "Worst Case" Worsens
Posted to: MND NewsWire
Wednesday, February 02, 2011 1:37 PM
Wednesday, February 02, 2011 1:37 PM
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HUD's definition of Worst Case Housing Needs (WCN): unassisted very low-income renters who either (1) pay more than one-half of their monthly income for rent; or (2) live in severely inadequate conditions, or both. HUD defines "very low-income" as below 50 percent of the local area median income (AMI) and "extremely low-income" as below 30 percent of AMI.In its Worst Case Housing Needs report to Congress, the Department of Housing and Urban Development said the number of people classified as "Worst Case" grew by nearly 1.2 million households, or 20 percent, from 2007 to 2009 and 42 percent since 2001. The two-year increase was the worst in at least 20 years.
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The report is based on further analysis of the American Housing Survey which is conducted every two years, most recently between May and September 2009. Not surprisingly, it found a direct link between the increased number of Worst Case Needs and the recent recession and the high rate of joblessness in America. However, given those dates, it is obvious the data does not reflect the total impact of the recession or any effects of the Obama Administration's recovery efforts. Unemployment and under-employment pushed 410,000 more households into the Worst Case Needs category, which accounts for more than one-third of all new cases.
Dr. Raphael Bostic, HUD's Assistant Secretary for Policy Development and Research said in a press conference accompanying the release that severely inadequate housing, that which has one or more serious physical problems related to major systems or maintenance, has accounted for a declining number of Worst Case Needs and now represents only 2.9 percent. The majority of the 7.1 million worst case renters are those with low incomes who lack any type of rental assistance and pay a burdensome amount of rent.
Bostic, said, "The loss of income and the general lack of affordable housing are clearly putting a lot of stress on unassisted families at the lower end of the income spectrum. It's equally clear that had it not been for housing assistance offered by HUD, the economic impact on very low-income renters would have been greater still."
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Worst Case Needs are broad-based in all demographics, cutting across regions, ethnicity, population densities and household types. Some figures stand out such as an 8 percent jump in Worst Case Needs among the Hispanic population where 45 percent of households fall into that category. White non-Hispanic households now account for nearly 48 percent of worst cases, Black renters 23 percent, and Hispanic renters 23 percent.
Families with children represent 39 percent of cases and their numbers grew by 550,000 in two years. The second highest incidence, 33 percent, is among non family households, that is non-elderly and unrelated persons who share a housing unit. Numbers in this category also grew by 580,000 households which may indicate that households are doubling up in order to manage shrinking incomes and growing rents.
Persons with disabilities have a high presence among worst cases with 38 percent reporting a non-elderly resident. There is other evidence indicating that persons with disabilities are being severely undercounted, perhaps by as much as 60 percent, and HUD plans to look further at this cohort.
The effects of un- and under-employment are exacerbated by a shortage of affordable housing and this competition accounts for about 41 percent of the increase in worst cases. Competition leads to displacement, absorption of vacancies, and upward pressure on rents. Supply and demand led to increases in mean gross rent for very low-income renters of more than 10 percent in the two years and the number of vacant units affordable to this population dropped by 370,000. Only 32 units of housing are available for every 100 extremely low income renters and 60 units for very low income renters. The supply of housing is even more scarce in central cities and suburbs than in rural areas and in the West than in other regions, but the numbers of affordable units is far from sufficient in any region.
Bostic said that the Worst Case numbers would have been much worse were it not for the 4.4 million households that receive some type of rental assistance but the resources available can't cover the numbers of people who need it. While this has always been a problem, he said, currently many areas have waiting lists for assistance that stretch into multiple years.
There are ongoing conversations with Congress about increasing assistance but Bostic said until this report was complete HUD did not know the extent of the current problem. He hopes that the report will form a base for further discussions even in light of the fiscal realities.
READ MORE: Time For A Serious Look At Housing Problems And Policy
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