What are some of the key characteristics of a healthy housing system? And how can the success of these features be measured?
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A healthy housing system would meet the housing needs of most if not all Americans regardless of income, race and ethnicity, health status and geography. What do we mean by “meeting housing needs?” Since 1949, federal housing policy has focused on four attributes – decent, safe, sanitary and affordable. More recently, scholars and advocates have inserted a new lens – the location of housing and the potential of that neighborhood to provide families with access to quality education, training, jobs, services and civic opportunities. We call this “opportunity housing.”
How are we doing in meeting this definition of affordable housing Americans? In terms of affordability, we’re doing worse and worse. The percent of “cost-burdened” renters has doubled in the past 50 years, now up to 42%, and dramatically in the past decade. In a cruel game of “musical housing,” 10 million low-income renters fight for 3 million available and affordable apartments. In contrast, less than 20% of households in Canada – where housing prices have risen dramatically in the past decade – pay more than 30% of their income for housing.
Like health care, however, our dismal performance in meeting housing affordability goals for Americans is not due to insufficient public investment. We taxpayers subsidize housing to the tune of over $200 billion annually. These resources go disproportionately to homeowners, not renters. The president’s FY 2012 budget reports that in 2012, the Mortgage Interest Deduction will cost the Treasury an estimated $100 billion, compared to a total of $44 billion in current HUD budget. Add on the homeowners’ side of the balance sheet $23 billion in deductions on property taxes for owner-occupied home and $26 billion in exclusions on capital gains.
What about rationing our “housing care” expenditures more thoughtfully by making a slight adjustment to homeownership subsidies and using some of the proceeds to reward property owners who rehabilitate affordable housing for extremely low income households? The National Housing Trust and others have demonstrated that preserving and improving affordable housing in gentrifying neighborhoods leverages project based Section 8 by a factor of 10:1. Or put more funds into vouchers. Either way, the system would produce better outcomes across the income scale.
Beyond affordability, we need to ensure that housing policy meets multiple social goals. We all talk about housing as a platform, but what does that mean?
Affordable rental housing helps improve the health of renters by freeing up limited financial resources for nutritious food, health care and prescriptions. Children who are stably housed show lower levels of hospitalization, asthma, anemia and developmental delays than homeless children. Housing that is energy efficient not only saves money but reduces exposure to hazardous materials and airborne toxins commonly found in substandard housing. A one year stay in preserved and improved elderly housing with supportive services costs less than $25,000 while a one year stay in a nursing home subsidized by Medicaid costs about $50,000. The list goes on.
The measurement of the features of a healthy housing system is one that meets the needs of Americans to not only live in decent, safe, sanitary and affordable housing but also successfully helps our nation satisfy other critical social needs that are sapping our coffers and limiting opportunities for our nation’s elderly and families.
Michael Bodaken is President of the National Housing Trust.
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