WASHINGTON – In 2007, nearly 13 million low-income persons paid more than half their monthly income for rent, lived in severely substandard housing, or both. In a report to Congress, the U.S. Department of Housing and Urban Development found that these “worst case housing needs” grew significantly between 2001 and 2007.
HUD’s study, Worst Case Housing Needs 2007: A Report to Congress, is the 12th in a series of reports designed to measure the scale of critical housing problems facing low-income American renting households. Based on data from the American Housing Survey (AHS) conducted between May and September of 2007, this report does not address much of the economic impact being felt by this population due to the current housing crisis. HUD expects that its next Worst Case Needs report will include those findings.
“Behind every number is the story of a person or a family struggling to maintain affordable housing,” said HUD Secretary Shaun Donovan. “Whether these worst case needs are caused by general rental market conditions or by the lack of federal investment in affordable rental housing we saw between 2001 and 2007, the Obama Administration is not willing to turn a blind eye toward the absolute need we’re seeing all across our nation. That’s why we’ve increased our investment in affordable housing to meet the increase in worst case housing needs that developed over the past few years.”
Dr. Raphael Bostic, HUD’s Assistant Secretary for Policy Development and Research, added, “This report makes clear that worst case housing needs is a crisis that touches families of every type, of every racial and ethnic background, and from every part of the country.”
HUD found that 5.91 million households had worst case housing needs in 2007 compared to 5.01 million in 2001. These needs are defined as renters with very low incomes (below half the median in their area) who do not receive government housing assistance and who either paid more than half their monthly incomes for rent, lived in severely substandard conditions, or both. The report makes clear that worst case housing needs cut across all regions of the country and included all racial and ethnic groups, regardless of whether they lived in cities, suburbs or rural areas. In addition, HUD concluded that large numbers of worst case needs were also found across various family types including families with children, senior citizens, and persons with disabilities.
Demographics of Worst Case Housing Needs include:
- The number of households with worst case housing needs in 2007 was 5.91 million households, comprising 12.97 million individuals. This number was a slight (and statistically insignificant) decrease of 1.5 percent from the 5.99 million worst case needs in 2005. The small decrease in worst case needs from 2005 to 2007 occurred following a significant increase of 19.6 percent during the 2001-to-2005 period.
- The primary cause of worst case needs is severe rent burden (paying more than half of income for rent). Of the 5.91 million households with worst case housing needs, 5.48 million (93 percent) had severe rent burden as their sole problem, 190,000 households lived in severely inadequate housing, and 240,000 households had both problems.
- In general, worst case needs are more prevalent among extremely low-income families. A majority of households (4.33 million) had extremely low incomes (less than 30 percent of area median income), and a smaller but substantial portion (1.58 million) earned between 30-to-50 percent of their area’s median income.
- Family Type – Worst case needs are found across different types of families. Among the 5.91 million WCN households were: 2.19 million families with children; 1.21 million elderly households; 602,000 non-elderly disabled households; and 1.91 million “other” households.
- Disabilities – In addition to the 602,000 non-elderly disabled households, there were 404,000 families with children that had an adult with disabilities present – bringing the combined total of these two types of households with disabilities and worst case housing needs to more than one million. Disabled households were found to have the highest likelihood of having WCN among the four main family types (families with children, elderly, disabled and “other” households).
- Race and Ethnicity – Worst case needs were found across racial and ethnic groups. There were 2.92 million non-Hispanic white households, 1.35 million non-Hispanic black households, and 1.23 million Hispanic households with worst case housing needs.
- Geography – Worst case needs were found across national regions and across central cities, suburbs and non-metropolitan areas. In the West, 40.0 percent of very low-income renters had worst case needs in 2007, while the incidence in the South was 37.4 percent and 36.2 percent in the Northeast. The Midwest had the lowest incidence, yet in this region too, more than one-third of very low-income renters, 34.3 percent, had worst case needs. Nearly equal shares of these households lived in central cities (37.7 percent), suburban areas (34.7 percent) and non-metropolitan/rural communities (32.1 percent).
- Working Families – During 2007, near half (46 percent) of households with children that experienced worst case needs were working the equivalent of full-time and earning at least minimum wage.
The continuing worst case needs crisis shows the need for both more affordable housing and increased family incomes. Key elements of the President’s proposed Fiscal Year 2011 Budget for HUD affordable housing and economic development activities include:
- Transforming HUD’s rental assistance by consolidating 13 separate programs into one streamlined program to preserve the existing affordable housing stock.
- Investing $1 billion for the National Housing Trust Fund to support state and local affordable housing production.
- Building on the American Recovery and Reinvestment Act to increase family incomes and job growth through key economic development. This includes a$150 million Catalytic Investment Fund to stimulate local economic innovation and $250 million for the Choice Neighborhoods Initiative to transform neighborhoods with concentrated poverty into sustainable mixed income communities.