Most of the affordability improvements since the end of the Great Recession were among low- and moderate-income owners. The share of severely cost burdened low- and moderate-income owners fell from 21.2 percent in 2009 to 18.6 percent in 2012. Low- and moderate-income owners benefited from falling housing costs as many were able to modify or refinance their mortgages at lower interest rates or buy homes at low prices.
The affordability improvements for low- and moderate-income households were driven by increases in incomes that outpaced housing cost increases. Between 2009 and 2012, the incomes of low- and moderate-income renters rose 5.1 percent, as their housing costs rose 3.9 percent. The incomes of low- and moderate-income owners rose 2 percent at the same time their housing costs actually fell 5.1 percent.
The lowest income households face the greatest housing costs burdens; 8 in 10 extremely low-income households had severe housing cost burdens in 2012. Severely housing cost burdened households are stretched thin and many face impossible choices like cutting back on other essentials such as food and health care in order to make ends meet. While 2012 offered a better affordability picture for working households than previous years, more than one in four low- and moderate-income working renters, and nearly one in five low- and moderate-income working owners is still severely burdened by their housing costs.
For many more detailed results, download the full report (PDF).