Analysis finds affordable housing shortage hits middle-income buyers the hardest
An affordable home for middle-income buyers is around $256,000
(InvestigateTV) — An analysis from the National Association of Realtors (NAR) found the U.S. housing market is short more than 300,000 affordable homes for middle-income buyers.
NAR Chief Economist Lawrence Yun said in the analysis that not enough new housing was created in the decade leading up to the Covid pandemic, which is still causing shortages today.
“There are simply not enough homes to house the growing population in America and consequently, we are seeing significant rise in rent over the past two years,” Yun explained.
He said from 2010 to 2020, right before COVID, there was a roughly five-to-six-million-unit shortage in relation to the job creation that occurred in the country.
Tony Bertoldi, Co-President of CREA, LLC, an affordable housing investment company, agrees.
“When you think about all the jobs that are available and the jobs that we need people to work in and the jobs that people have as they move up in their career or if they might be in school or it might be just out of school if they’re earning minimum wage.” Bertoldi said. “They can’t afford a market rate apartment in that market.”
NAR has a map showing which areas in the country have the largest housing shortages. The Pacific coast and Northwest corridor have some of the biggest deficits.
“Well, from a consumer’s perspective, it’s all about expectation. So, if one is living in say, Seattle region, expect rise in rent! But also, it’s an important metric for policy makers,” Yun said. “For the policy maker this is saying, ‘look, one may have to provide some government funding.’ View housing shortage as an infrastructure. We need to build more housing to relieve the shortage or even provide some tax credit or even rental subsidy for the local residents because they understand housing costs is very expensive in those red colored areas.”
Bertoldi said he’d like to see Congress act.
“As it turns out right now in DC, there is a tax bill that is being proposed and drafted that would increase the amount of affordable housing production,” Bertoldi said. “It is estimated that if this tax bill passes, there will be an additional 200,000 affordable homes that could be built from the proceeds of this tax bill.”
As for renters and prospective homeowners, experts recommend contacting your local housing authority for assistance as well as non-profits that deal in the housing market.
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