February 3, 2018

Worcester’s affordable housing gap

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Sun graphic / Amy M. Capobianco

(Source: U.S. Census Bureau.)

Before the 20th century, low-income housing was a fairly profitable investment. There was little regulation, and developers simply maximized density and minimized amenities.

Today, building codes have forced developers to add amenities and use space differently, which has taken away some of the profitability of developing affordable housing. While government programs to combat this have arguably helped, Worcester still has plenty of low-income renters paying more than 30 percent of their income toward housing costs.

The federal affordability threshold defines an affordable rent as 30 percent or less of a household’s income.

One reason low-income renters have a heavy rent burden may be there are just not enough affordable units.

The blue line in this week’s chart shows the cumulative number of renters in Worcester with a given income or less. The green line shows the number of apartments in Worcester that are available to a renter with a given income that can be considered affordable. When the blue line is above the green line, it indicates there are not enough affordable housing units.

For example, the U.S. Census Bureau estimates there are roughly 27,900 renters in Worcester who make $35,000 or less. However, there are only 16,000 apartment units that are affordable for this group. This means some of these renters are going to pay above 30 percent of their income.

This gap shows up when we look at rent burden by income. Seventy-four percent of renters who made below $35,000 a year paid more than 30 percent of their income in rent and utilities. Only 21 percent of renters making above $35,000 had such a heavy rent burden.

Both sides of the political spectrum have tried to fix the affordable housing problem. Free markets allowed low-income housing to be a profitable enterprise, but the tenants suffered awful conditions. Market interventions like rent control have been shown to do little, if not hurt landlords and tenants alike (https://www.urban.org/urban-wire/rent-control-good-policy), even if they kept rent lower.

Affordable housing is a goal worth striving for, but if we want to help the people caught in the gap, let’s make sure good intentions don’t hurt more than they help.

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