Low-Income Renters Struggle to Find Housing

By Sarah Holder, for City Lab

Finding affordable housing isn’t getting any easier for the more than a quarter of U.S. renters that are extremely low-income. For six years, the National Low Income Housing Coalition has released an annual report calculating the discrepancy between available affordable housing units and renters who earn below the poverty line or 30 percent of the area median. Last year, they found that for every 100 households categorized as extremely low income (ELI), only 35 affordable rental homes are available—a shortage of over 7 million affordable and available homes. That same figure stands today.

Part of this shortage is caused by an influx of higher income households into more affordable homes: Almost half of the affordable rental units are occupied by families that earn above the poverty line. As incomes get higher, cumulative shortages get less pronounced. Households that earn less than 50 percent AMI have 56 affordable and available rental homes; those below 80 percent have 93.

A map of the gap (click here for an interactive version) shows that it’s a problem that persists everywhere—not one state or metro has enough affordable housing, though different shades represent varying degrees of scarcity:

Every state has fewer than 59 affordable housing units available for every 100 extremely low income families. Most have even less. (NLICH)
California, home of high-earning tech workers and ballooning rents, has 22 affordable and available units per 100 extremely low income (ELI) renter households. But the worst offender is Nevada, with only 15. Even in recovering markets, the demand for affordable housing is far greater than the supply: Maine has the relative best ratio in the country, with 59 units; Alabama, West Virginia, and Mississippi are close behind.

On the metro level, Las Vegas, Nevada’s largest city, has the most severe relative shortage, with only 10 affordable units for every low income household. The reason, says Andrew Aurand, vice-president of research at NLIHC and a co-author of the report, could be that Nevada is still struggling to recover from the housing crisis, and Las Vegas has a large base of low-income service workers slowly getting pushed out, California-style, by a boom of tech professionals. Orlando, Los Angeles, Houston, and Dallas are next up in the rankings.

“The problem is not that low-income people aren’t working hard enough,” said Diane Yentel, the president and CEO of NLIHC. “The problem, rather, is that many jobs don’t pay enough for low-income people to afford to pay the rent.” The average full-time, 40-hour-a-week worker making minimum wage would need to earn more than $17 an hour to afford a modest one- or two-bedroom apartment by today’s standards. NLIHC estimates that someone making the federal minimum wage of $7.25 (higher in many cities, but not by much) would have to work multiple jobs—and a sanity-draining average of 94.5 hours per week—to make enough to afford even a one-bedroom.

That’s why so many low-income American renters are considered cost-burdened—9.7 million ELI renters spend more than 30 percent of their income on rent; of those, 8 million are considered severely cost burdened, forced to spend more than half.

Read more from this article and about other housing repercussions at City Lab