Report: One in Four Working Renter Households Is 'Severely Housing Cost Burdened'

The National Housing Conference’s Center for Housing Policy recently released a cost burden report that examines trends in housing affordability for low- to moderate-income working families throughout the United States. Using the U.S. Census Bureau’s 2013 American Community Survey data, the report showed that while the share of households spending more than half a household’s gross monthly income on housing costs (severely cost-burdened) decreased overall from 2010, housing affordability remains a significant issue for working households, particularly for renters. 

From 2010 to 2013, the share of working renter households with a severe housing cost burden decreased slightly from 25.6 percent to 25.0 percent. However, the number of severely cost-burdened working renter households grew by more than 175,000 from 2010, when there were 5.9 million severely housing cost-burdened working renter households.

According to the report, the share of working renter households with severe housing cost burdens in 2013 was 25 percent, notably higher than the 17 percent of severely cost-burdened working households who own their homes. Additionally, median monthly housing costs for renters are steadily increasing while ownership costs are falling. In 2010, the difference in median monthly housing costs between owners and renters was $207. In 2013, the difference had shrunk to $91.

A rise in median income for working households—both owners and renters—has helped to lessen the share of households with severe housing cost burden. But it’s important to note that housing affordability remains a challenge: In 2013, more than 15 percent of all U.S. households were severely housing cost burdened and the percentage for working households was even higher, at more than 21 percent.

This year’s report also examines housing affordability by race/ethnicity for the first time. It found that working households headed by non-white individuals are more likely to be severely cost burdened than their white counterparts. In 2013, the share of white-headed working households with a severe housing cost burden was 18.4 percent, compared to about one in four African-American- and Hispanic-headed working households. The percentage of severely housing cost-burdened working households is highest among Asian- or Pacific Islander-headed households, at more than 28 percent.

The need for affordable housing far exceeds the supply. The report highlighted the fact that the LIHTC program is currently the primary means by which new affordable rental housing is built. However, the report points out that despite its effectiveness, the overall cap on the LIHTC program limits how much affordable housing the program can produce.