Friday, June 6, 2014

New Survey Finds Housing Affordability Challenges are Far Too Common

by Chris Herbert
Research Director

Earlier this week, the MacArthur Foundation released its second annual nationwide survey, How Housing Matters. The survey sheds important light on American attitudes and experiences with a range of housing issues. Among the topics covered, one that aligns with a key theme in our forthcoming report, The State of the Nation’s Housing (to be released June 26, 2014), is how widespread the struggle to meet monthly housing costs has become. At last count in 2012, more than a third of all households were paying over 30 percent of their income for housing, the most common standard of affordability. But the MacArthur survey, conducted by Hart Research Associates, finds that an even higher share of respondents (52 percent) report making one or more significant tradeoffs within the last three years because they were struggling to pay their rent or mortgage. (Click figure to enlarge.)

Figure 1

The most common behavior among those struggling to pay for housing is to take on another job or more hours at work, reported by 21 percent.  But for many this is either not enough to close the gap or not an option. So another 16 percent use credit cards to cover their shortfall, which simply pushes the problem to another month. But many also report cutting spending on such important items as retirement savings, health care, and healthy food.  This finding is consistent with our own research; these are precisely the areas where spending reductions are made among those with severe cost burdens (devoting more than half their income to housing costs).

The MacArthur survey is an important complement to existing research documenting the extent of affordability problems across the country, how aware Americans are of the problem, and how supportive they are of efforts to address it. Given how widespread the struggle to pay for housing has become it is not surprising that a majority of households polled for the survey believe that affordable, quality housing (to rent or own) is either somewhat or very challenging to find in their communities.  

Figure 2

Notably, a majority (58 percent) also believe that state and local government should be doing more to address this challenge in both the rental and owner-occupied housing markets.  Hopefully this strong public support will translate into concrete actions to address this urgent problem.

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