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Has Low-Income Housing Become a Thing of the Past?

Has Low-Income Housing Become a Thing of the Past?

Experts claim poorer families are finding it more difficult to find a place to live

October 9th, 2012 by Daryl Nelson of ConsumerAffairs in News

The United States is in the middle of some trying times, and in the midst of the nation's economic challenges many of our other problems seemed to get pushed to the outskirts of public consciousness, and homelessness is one of them.

According to a report from the Institute for Children, Poverty and Homelessness (ICPH), the lack of low-income housing has contributed to a 20 percent rise in family homelessness between the years of 2007 and 2010.

The report also indicates there are only 5.4 million apartments that are $458 or less in rent, which is an extremely low amount considering that 10.9 million families earn $18,310 a year or less, which meets the federal poverty line, the report shows.

Contributing to the low-income housing shortage is that 2.3 million (42 percent) of affordable housing is occupied by families who earn salaries far over the poverty limit, taking away housing opportunities for those that truly need it. And according to the experts the homelessness problem will only get way worse before it gets better.

Feds pulled out

"The primary reason is the federal government stopped producing, they got out of the business of producing low-income housing in the 80s", says Matthew Adams, the principal policy analyst for ICPH, in an interview with ConsumerAffairs. "They sort of devolved all that responsibility to the states and gave states some of the money to do that, but states have been unable to do that on their own. Particularly in today's climate, states are broke."

"On top of that you have median rents rising 37 percent between 2000 and 2010," Adams noted. "And at the same time median household incomes fallen nearly 10 percent between 2000 and 2009, and the census reported just last week that median household incomes fell another 1  1/2 percent between 2010 and 2011."

"Also, the welfare rolls have declined 60 percent between 1996 and 2011, so that further decreases any sort of available income that families might have. If you want to pin it on somebody at the end of the day, it's the feds for not building this housing," he said.

Feds preoccupied

But the feds have been pretty tied up with the economy, global and domestic terrorism, and managing the simultaneous wars we're in. Has all of this led to a growing amount of indifference towards low-income families and the homeless?

"Politicians today are focused on the economy, the shrinking middle class, and these are definite absolute priorities," said Adams. "But sort of lost and forgotten in this situation is low-income households, and particularly homeless families -- the poorest of the poor families out there. I think they're definitely absent from the current policy debates."

Even among the small numbers of affordable housing that's currently available for poorer families, a large number of those units tend to be occupied by families that make more money and can afford higher rent.

One would think there would be enough regulations in place so the proper rental units go to the proper families. Adams says it's not hard to gather why even those families who have higher incomes want to minimize their housing costs.

"Who can blame them, right?" he said. "If you can find a cheaper apartment and pay less on your income on rent, you know, the sort of definition of affordable is no more than 30 percent of your income on housing related expenses, so if you can spend 20 percent that's more for savings, so you can't really blame these families."

"But once you factor that in, it leaves only 3.1 million units available instead of the 5.4 [million] in 2009, and that increases the gap by 7 million units, and that's just a huge thing," he said.

Section 8

Adams also notes that issuing section-8 vouchers was a popular way the federal government would help low-income families in the 1980s, but the problem has become so widespread in recent years, there just aren't enough vouchers to keep up with the demand. He also says even the vouchers that are currently being distributed don't go to the poorest of families most of the time.

And though there are enough rental units for all that need them in the United States, landlords and the general market dictate rent prices so a large portion of the country just can't afford to live anywhere. And the units they can afford, many families have to go on lengthy waiting lists that can stretch on for decades, says Adams.

He also says things probably won't get better for low-income families anytime soon.

"This is the trend that has been coming through for decades, I don't see any sort of major investment in low-income housing coming at any point in the near future," he said. "Feds relinquished responsibility to the states and so states in response have developed essentially housing trust funds. So there's like 700 of these state and local housing trust funds and annually they raise about a billion dollars for low-income housing."

"In 2008 the national housing trust fund was signed into law, and President Obama the last four years have tried to securitize that, but he's been unsuccessful, so even if that happens we're investing $2 million a year, and to give you an idea of how inadequate that is, just the budget for rental assistance is $16 million alone for $2 million vouchers, so those number are just not going to add up. There's not going to be a big change," he said

What has changed, Adams said, is the fact the government has gone from providing rental vouchers to simply building more homeless shelters, and that same money could be better used to provide personalized housing to lift families up and out of poverty. But that's not going to happen anytime soon, he said.