Affordable housing crisis hurts the poor, but not market-rate renters: study

Los Angeles /
Jun.June 22, 2016 03:00 PM

From the New York website: Contrary to popular conception, the trend of rising rents and diminishing inventory has minimal negative impact on mid- and high-earning renters. 

“The story tends to be generalized that’s it’s tough for all rental households. The top-earning groups have not been particularly challenged,” Greg Willett, chief economist at property management software maker RealPage, told Bloomberg.

Although 26 percent of American renters now pay at least half their income for housing — up 6 percent since 2001 — median incomes have also risen, according to a new study published by Harvard University’s Joint Center for Housing Studies.

Most market-rate tenants, therefore, are keeping up with rent growth. For the most part, they can lease apartments that fit their budgets and even put away savings for buying their first homes.

Between now and 2010, the median rent-to-income ratio has remained between 22.9 and 23.3 percent. During that same period, median income of market-rate renters grew from $44,000 to nearly $58,0000.

But for those below the median mark, things are not looking swell. At the bottom of the rental market, the median renter is spending more than 30 percent of income on rent. Not to mention, affordable housing supply is staggering behind the growing number of low-income households.

In 2014, more than 10 million renter households earned 30 percent or less of their area median income. But only about 5 million affordable apartments were available for them. And as new construction largely caters to luxury renters, cheaper units take time to enter the market.

And as the number of poor households have been on a steady incline in the past 30 years, the number of households receiving rental assistance has remained the same. Federal subsidies for rent hasn’t increased in 15 years. [Bloomberg]Cathaleen Chen


Related Articles

arrow_forward_ios
Jeffrey Jaeger and the Villa Raymond Apartments (Google Maps)

Standard Companies buys Pasadena senior housing, plans fix-up

Standard Companies buys Pasadena senior housing, plans fix-up
Weingart towers

LA approves $200M in bonds for affordable housing projects

LA approves $200M in bonds for affordable housing projects
The development site for the planned 207-unit complex (Credit: Google Maps)

Mapleton Properties plans 207-unit complex in Palms

Mapleton Properties plans 207-unit complex in Palms
City Controller Ron Galperin( Credit: Ron Galperin/Wikipedia)

LA controller finds just 228 homeless housing units built with $1.2B bond

LA controller finds just 228 homeless housing units built with $1.2B bond
The coronavirus pandemic could worsen California’s affordable housing crisis

COVID-19 exposes the utter dysfunction plaguing affordable housing development in California

COVID-19 exposes the utter dysfunction plaguing affordable housing development in California
From left: Neil Shekhter and Governor Gavin Newsom (Credit: Kevin Scanlon, Justin Sullivan/Getty Images, and iStock)

Tenant group calls for CA rent strike

Tenant group calls for CA rent strike
Skid Row Housing Trust CEO Lee Raagas and a rendering of the project (Credit: Michael Maltzan Architecture via Urbanize)

Skid Row Housing Trust, Michael Maltzan Architecture plan mass-timber housing tower

Skid Row Housing Trust, Michael Maltzan Architecture plan mass-timber housing tower
Los Angeles City Attorney Mike Feuer (Credit: iStock)

City Attorney Mike Feuer will run for mayor. Here’s what it means for LA real estate

City Attorney Mike Feuer will run for mayor. Here’s what it means for LA real estate
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...