For millions of Americans, housing is a source of daunting insecurity. The economic dislocation caused by COVID-19 has only exacerbated housing affordability challenges that existed before the pandemic.
To elevate these urgent concerns on the national agenda, I am joining forces today with the Bipartisan Policy Center to launch a new housing policy center with the broad bipartisan vision of every American family, regardless of wealth or background, living in a decent, safe and affordable home.
As the Chair of Habitat for Humanity’s Global Development Council, I have witnessed first-hand the enormous unmet housing needs across the planet. While many countries struggle with housing quality and adequacy, here in America housing affordability is a preeminent concern.
In 2019, nearly half of all renters, more than 20 million households, surpassed the federal housing affordability threshold by spending in excess of 30 percent of their incomes just on housing. Even worse, nearly 11 million spent in excess of 50 percent. Families with low incomes are hit hardest by these high rental costs, which can force painful decisions about how to allocate scarce financial resources to pay for food, health care and other essentials.
Many heavily rent-burdened households are just one paycheck away from a dreaded eviction notice. As of early July 2021, approximately 6.5 million renter households were behind on rent, with more than half earning less than $35,000 annually. With the end of the federal eviction moratorium, their situations are even more precarious.
On any given night, some 580,000 of our fellow citizens are on the streets, homeless. Shuttling between shelters and the streets can have grave consequences for physical and mental health, particularly for children, and can trigger a cycle of poverty that is difficult to escape.
Federal rental assistance is a powerful tool for improving housing stability, reducing homelessness, and enhancing economic opportunity. Unfortunately, due to limited funding, only one in five low-income families eligible for relief receives assistance through the federal Housing Choice Voucher program. Many families wait years to receive aid through a lottery system.
It is in America’s profound self-interest — both economically and socially — to ensure all our families are stably and affordably housed. Of course, the shelter a home provides is a basic necessity of life. But access to stable, affordable housing of decent quality can lead to other significant outcomes: Better health and lower health care costs; greater community engagement and sense of belonging; and a lifetime of benefits for children seeing improved academic performance from simply having a home. Moreover, access to affordable homes located in good neighborhoods with good schools can serve as the springboard for upward mobility.
Responding to America’s housing-affordability crisis will require the focused attention of policymakers and a commitment of significant resources that goes well beyond the sums appropriated for housing assistance by both parties in response to the pandemic. It will require the active engagement of my private-sector colleagues in the real estate and construction industries. And a comprehensive strategy — one that responds forcefully to both the “supply-side” and “demand-side” dimensions of the crisis — is an absolute must.
High rents and the cost burdens they impose are the direct result of a severe shortage of affordable and available rentals — an estimated deficit of 7 million exists for renters with the lowest incomes. Without substantial subsidies, private developers of “market-rate” rental housing will not cover this shortfall. Expansion of the Low-Income Housing Tax Credit and the use of other tools to incentivize private investment in the construction and preservation of affordable rental homes will be critical. Eliminating unduly burdensome zoning and land-use requirements that add time and cost to development must also be a priority.
On the “demand side,” we must ensure sufficient funding is available so those households who qualify for a federal housing voucher can actually receive one. Voucher recipients must also be treated fairly and not be subjected to “source of income” discrimination by landlords who refuse to lease to families receiving housing assistance. In addition, new approaches are in order: One promising idea is the use of “mobility vouchers” to give very low-income families with young children the financial means to move to rental homes in neighborhoods with better schools and more opportunities. The bottom line is that no child’s outcome in life should be pre-determined by the zip code at birth.
And let’s not forget the direct link between the rental and homeownership markets: Improving rental affordability should ultimately give more renters, including many minorities, the opportunity to build up the resources necessary to enter the homeownership market for the first time. In this way, a focus on rental affordability can help close the staggering racial gap in homeownership rates, now at 30-percentage points between white and Black households.
To have a durable impact, any comprehensive response to America’s housing-affordability crisis will require “buy-in” by both political parties.
I am excited about this partnership with the Bipartisan Policy Center to advance bipartisan solutions that will help transform housing into a source of comfort and stability for millions of our neighbors and friends.
Ron Terwilliger is chairman emeritus of the Trammell Crow Residential Company and the founder of the J. Ronald Terwilliger Center for Housing Policy at the Bipartisan Policy Center.