Housing Needs and Trends Examined -- California Capitol Hill Bulletin - Volume 10, Bulletin 11 -- April 25, 2003

On Friday, April 11, 2003, the Population Resource Center in association with the Northeast-Midwest Congressional Coalition and the California Institute for Federal Policy Research held a briefing about housing issues in the nation. Titled "Housing America - Trends, Opportunities, and Needs", the briefing explored census data housing indicators, looked at trends in homeownership, and discussed housing policy and affordability, particularly with respect to families moving from TANF to self-sufficiency.

Presenters included Peter Fronczek, Assistant Division Chief, Labor Force and Outreach, U.S. Census Bureau; David Ledford, Vice President, Housing Policy and Finance, National Association of Home Builders; Barbara Sard, Director of Housing Policy, Center for Budget and Policy Priorities; and Mark Calabria, Majority Staff, and Jonathan Miller, Minority Staff, Senate Committee on Banking, Housing and Urban Affairs. William A. Davis, Jr., President, Davis Developments, Inc., served as the moderator for the panel of presenters.

Citing census data, Mr. Fronczek stated that 69.8 million of the total 115.9 million housing units in the nation were owner-occupied, 35.7 million were renter-occupied, and 10.4 million housing units were vacant in 2000. Mr. Fronszek said that monthly gross rent (adjusted) increased 114 percent, rising from $283 in the 1940s to $602 in 2000, translating into less than 17 percent of income in the 1940s to 25.5 percent of income in 2000. He joined Mr. Ledford in noting that ownership rates soared in the last 60 years, rising from less than 40 percent in the 1940s to 66.3 percent in 2000.

Though national homeownership rates have been steadily increasing over the years, California rates are lagging behind that of the rest of the nation. According to Mr. Ledford, California ranks third in lowest homeownership in the nation with a 56.9 percent rate, preceded by the District of Columbia and New York, with 40.1 percent and 52.3 percent homeownership rates, respectively. California also leads the nation as the state with the second highest home values, with an average home value of $283,891 in 2000, falling behind Hawaii whose average home value was $311,519.

Building on the latter, Ms. Sard spoke about the affordability in rental markets. She stated that 94 percent of low-income families pay more than 50 percent of their income for rent, and a typical family moving from TANF to self-sufficiency must pay approximately 58 percent of total income for decent modest housing. A sizable share of low-income families reside in California. Ms. Sard added that lack of affordable housing with access to jobs compounds not only the difficulties families trying to leave the welfare face, but also the problem of low homeownership rates.

Responding to the data presented by other participants, Mr. Calabria said that homeownership is the primary goal of the Senate Banking Committee Chair Richard Shelby (AL). Mr. Calabria and his minority staff colleague, Mr. Miller, agreed that the housing problem in America is an income and affordability problem.

For more information, visit the Population Resource Center's website at http://www.prcdc.org .

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