Housing Costs Are Squeezing More Low-Income Households

The more money very low-income people spend on rent and other related expenses, the less they have for food, clothes, transportation, and other essentials. Those that spend over half their income on rents constitute the U.S. Department of Housing and Urban Development’s “worst case housing needs.” According to a new HUD report, the number of households in that predicament jumped from almost 6 million households in 2007 to just over 7 million in 2009, a 20% increase.

Why did this happen? Higher income households are occupying more of the low-income ones can afford.

• For example, higher income renters occupy about 42% of the units that are affordable to extremely low-income renters, who earn less than 30% of the area median income (AMI).
• The situation is a little better for those households on the next rung of the income ladder—those earning between 30% and 50% of AMI). Higher income renters occupy 36% the units afford affordable to this group.

Here’s another way to look at the situation: Only 32 units of adequate, affordable rental housing are available for every 100 extremely low-income renters and only 60 adequate units are available for every 100 low-income renters.