Today, the Joint Center for Housing Studies (JCHS) at Harvard University issued its annual report, “State of the Nation’s Housing,” and its findings were disturbing, though not surprising. I’ve often said that housing is not a zero-sum game. Good news for homeowners is not bad news for renters, or vice versa. Unfortunately, the JCHS report has bad news for everyone.
The current homeownership rate of 64 percent, which represents a small increase over recent years, is still the lowest in over a quarter century, and homeownership rates for younger adults and minorities today are even worse. Between 1994 and 2016, black homeownership rates increased by just 0.3 percent while white homeownership rates rose 2.2 percent, widening the black-white gap to 29.2 percent. Renters are under even greater stress. The Joint Center report found that more than 38 million U.S. households – nearly a third of all households – paid more than 30 percent of their incomes for housing in 2016. 20.8 million renter households are cost-burdened, and more than half pay over 50 percent of their income for housing. Think about your own income and having to devote half of that to rent and you’ll understand what millions of our fellow Americans are experiencing every day.
The most meaningful response is to build more affordable housing, which is needed for everyone from extremely low-income families to those firmly in the middle class. Yet our rental housing stock continues to shift to higher-cost units, in part because units that were once considered affordable have seen rents increase, and in part because even the most progressive among us refuse to allow subsidized housing in our neighborhoods. Not surprisingly, the number of people experiencing homelessness increased in 2017, ending a six-year trend of decreasing homelessness. Just today I was approached by someone I have known for several years who told me he is now homeless.
Demographics are not going to provide any relief. Over the next 20 years the aging of my generation – the baby-boom generation — will grow the senior population by an estimated 30 million people. However, our current rental housing stock is not equipped to address this need. My daughters’ generation, the millennials, was hit especially hard by the Great Recession, just as they have entered independent adulthood. Think about how many of our friends and colleagues continue to support their adult children, at home or through much-needed financial support. And for those whose children are becoming homeowners, it’s important to remember that the parental “loan” is a down payment assistance program funded by multi-generational wealth and unavailable to 90 percent of Americans. I am grateful I received just this kind of support when I bought my first home, but being born on second base doesn’t mean I get to brag about hitting a double, or question why you are still on first.
I’ve tried to personalize some of these numbers because the fact is that the American Home is deeply personal to all of us. For those of you who were able to attend last week’s Gala, you saw that first-hand. We’ll publish a full report on the Gala and Policy Symposium once we get our photographs. For now, I hope that if you are not a member of NHC, you’ll join us today. You can do it online right now. As Harvard’s JCHS report makes clear, the battle to defend the American Home needs us all.